A group of movie theatre operators are not happy with the new regulations that Walt Disney Co (NYSE:DIS) imposed on the theatres looking to show the movie, “Avengers: Age of Ultron.”
The head of the movie theatre trade group reported the complaints to Disney studios cutting unfair conditions that Disney imposed. Some of the changes include the rulings on pricing and alternating shows. The association claimed that the regulations may lead to hiked prices in the long term. New prices might reduce the viewer’s appeal.
Following the complaints, Disney Studios responded with a revised approach to various aspects of the contracts. Some of the revised changes include proposed fee limitation and matinee cutoffs. Additionally, the Disney studio included the terms required in the regular licensing contract. This agreement dictates how theatres can show a movie, but the terms can be altered for different theatres.
One of the executives said that the acclaimed studio has a lot of control in the market. Most of this power has been generated by the company’s continued success especially with superhero blockbusters and other animated big hits. The studio will probably continue its successful growth streak with future titles. A good example is the expected sequel of the Star Wars franchise that is expected to debut in December this year.
The Avengers sequel experienced massive success when it premiered this weekend. Revenues for the first weekend amounted to $191.3 million in Canada and the United States alone. One of the Studio’s spokesperson said that there has been a strong relationship between the company and the distributors or theatre operators. Minor disagreements come up from time to time, but they always solve them and resume normal business. The spokesman also said that the studio expects their successful partnership to continue into the future.
Despite the assuring statement from Disney, theatre operators have expressed fears that other studios might also follow suit and pull similar stunts as Disney. Especially for the high budget franchises from other studios like Hasbro and Marvel.
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