Reimagining the "dollar theater" in 2023

For all of the recent talk about the return of the exclusive theatrical window, why has no one mentioned a possible revival of "second run" cinemas?

Last month, I went to go see Moving On, the modest dramedy starring Jane Fonda and Lily Tomlin, at the AMC Century City 15 in LA. I wasn’t particularly interested in the movie, but I like enough of writer/director Paul Weitz’s body of work that I figured it would be a fine way to wait out the traffic heading back home to Pasadena from the Westside during rush hour. With my AMC A-List subscription, the ticket was effectively free.

Alas, Moving On is a complete tonal mess, transforming from a zany “old people comedy” into a confounding story about the traumas of sexual violence and back again. But even if it worked better, it would still be a film of relatively modest ambitions, with little to make it inherently more “theatrical” than Fonda and Tomlin’s recently concluded Netflix series, Grace and Frankie.

Still thinking about this (barely a) movie as I emptied the ticket stub from my pockets that night, the admission price – waived thanks to A-List – really jumped out at me. $18.49. Yes, nearly $20. More than the monthly subscription fee for any major streaming service. To see Moving On. Granted, Century City is one of AMC’s West Coast flagships, but even in the LA suburbs, the evening ticket price is still north of $14.

If you know me or you’ve read enough of my writing, you know I’m as big a proponent of the theatrical experience – for all movies of all shapes and sizes – as one could be. I believe a big part of the reason movies are regarded as less culturally significant in 2023 than they were in 2003 is because the average person sees fewer of them in a theatrical setting. But it would be hard for even me to justify shelling out $18.49 for Moving On, even if it had been a much better movie; it’s simply not a memorable enough experience to be worth more than a month of Netflix, much less two Chipotle burritos. This is not at all about genre — I abhor the notion that dramas and comedies aren’t as “theatrical” as action and adventure — but rather, it’s about the scope of the film’s aspirations.

This is more or less the calculation that many – both decision-makers at movie studios and consumers alike – have been applying to the theatricality conversation from the pandemic onward. Does a movie justify the current cost of the theatrical experience? If not, then perhaps it is better off going straight-to-streaming. Perhaps even at the premium $19.99 PVOD price-point, which may still be more palatable than $18.49 in a theater as it isn’t multiplied by 2 tickets and paired with the cost of gas, parking, concessions, and a babysitter. The big flaw in this logic, of course, is that if the answer is a resounding “yes, the movie is worth the price of admission” for only 10-15 tentpoles a year, then the industry will surely collapse.

This is why the pendulum is now quickly swinging back in favor of exclusive theatrical windows. We seem to be nearing the point where nearly everyone in the industry once again agrees that exclusive windowing is essential to protecting the full revenue potential of a given title. But what is not as often discussed is how to adapt windowing to today’s forever-altered consumer preferences and value perceptions. Moviegoing used to be something habitual and ritualized; think of the couple who would go to the movies every Friday night and simply pick what they wanted to see most out of what was playing. Now, thanks to the recent abundance of streaming options, consumers ask the dreaded question: “Is this worth seeing in a movie theater?” That isn’t about to change just because PVOD options have been taken away.

Hollywood and the exhibitors need to find the right way to make consumers answer “Yes, it is worth seeing in a theater” more often. Part of this is about improving the theatrical experience – not just in terms of the highly-marketable comfy chairs and expanded concession options, but by offering consistently flawless projection and sound. Another part of it is about bringing the habitual nature of moviegoing back – getting that couple in every Friday night, so they’re building their lives around moviegoing. But I also think we should be thinking bigger.

All of the recent talk of theatrical windowing has made me think a lot about discount or “second run” theaters. Despite many of these “dollar houses” flourishing as recently as five years ago, they are now nearly extinct. Due to the shortening of the theatrical window during the pandemic, many of the remaining key players in second-run exhibition, such as Regency and Tristone in Southern California, converted most or all of their “second run” locations to “first run.” Regency’s Buenaventura 6 in Ventura is the last true operating “discount house” I can think of offhand; in February 2020, I could have named a dozen without breaking a sweat.

What I now find myself wondering is whether we need to reinvent the “dollar theater” concept for our new era of changed windows. Certainly, the old model of a title starting its “second run” at the 45-day mark before going to home video an additional 45 days later has come and gone. Nor will today’s audiences, spoiled by cheap 65” 4K HDTVs from Walmart, tolerate the kind of presentation conditions afforded by many former discount houses, which commonly featured mildewy auditoriums, broken chairs, and dim projection. That said, I still can’t help but think there’s value in a second theatrical window – perhaps now more than ever.

Indulge me for a moment in a brainstorm. Abandon whatever preconceived notions you have about what a “discount house” is. Let’s envision a new version of the standard discount house that is more along the lines of what was a shiny new theater in the year 2000: stadium seating with full-size rockers, decent surround sound, a standard concessions menu. None of the bells and whistles of our newest theaters like in-seat food ordering, heated recliners, or Dolby Atmos sound, but still a very good big screen experience. I’d guesstimate that this is what nearly half of our current “first run” theaters in the U.S. still look like.

Let’s say that 1,000 or 1,200 of these “older” multiplexes – largely the lower-performing locations in big markets where there are also newer, nicer theaters – converted to become a new type of “second run” theater. But they certainly wouldn’t be playing movies 45 days after initially becoming available at their “first run” counterparts. I’m thinking that these new “second run” locations would get wide releases that gross less than $20M in their opening weekend starting on the third Friday of release (Day 15), those that gross $20M-49M starting on the fourth Friday (Day 22), and those that gross $50M+ starting on the fifth Friday (Day 29). So this coming weekend, for instance, you’d have both Dungeons & Dragons: Honor Among Thieves and John Wick: Chapter 4 making their “second run” debuts. Seem about right? “First run” theaters could still continue to show titles after their “second run” debuts, of course.

As for price-point, I’m thinking these theaters would charge about half of what their “first run” counterparts do – roughly $8-9 for evening shows and $6-7 for matinees in the major cities, and $6-7 for evening shows and $4-5 for matinees in smaller markets. In other words: similar to “value day” pricing at any of the major chains, but seven days a week. As with the original discount theater model, snack sales would drive even more of the total revenue at these sites than they do at “first run” locations.

But I want to go farther than just a better, expedited version of the old dollar house. I’m also envisioning a world where films like Moving On – the kind that simply aren’t going to perform at the “first run” price-point in the streaming era, but could still benefit greatly from a theatrical run – can skip directly to “second run” houses. Whereas $18.49 to see Moving On strikes me as pretty outrageous, $8.49 seems totally amenable. And ultimately, I think enough moviegoers would agree to make this a financially winning proposition for a number of movies.

In order to make such a scenario possible, there would have to not be a searing stigma associated with the choice to “skip to second run.” (I’ll never forget the filmmaker outrage when Lionsgate took the highly unusual step of dumping 2008’s Midnight Meat Train directly into discount houses to fulfill its contractual theatrical commitment, as this was *technically* still a theatrical run.) I think this is possible. Not only would these theaters be better technically-equipped than the dollar houses of yore, erasing quality-oriented objections, they would also give moviegoers extra incentive to go see smaller movies that don’t have the marketing budgets or spectacle-level to stand out when they open against Marvel.

Converting 20-30% of the nation’s screens to “second run” also seems like a smart way to solve what I’m anecdotally observing to be a looming issue for exhibitors: older megaplexes that have not converted to recliner seating are fading fast in popularity in markets with newer alternatives. Once-dominant locations have become sparsely attended because of shinier competitors. There’s perhaps no better an illustration of this phenomenon than Regal’s Edwards Long Beach 26 – once one of the highest-grossing theaters in the country – that is now dwarfed by the Harkins Cerritos 16 across the 605 freeway. Given this is an industry already taxed by bankruptcies and over-extended on credit, it would be unrealistic to expect conversions of hundreds of more underperforming locations across the country. But if these lesser-grossing sites could offer something fundamentally different than their more attended counterparts to attract the consumer, they might just stand a chance.

While I know this is all something of a pipedream, it somehow still seems more plausible than the large-scale implementation of dynamic pricing on a title-by-title basis at all cinemas. Presumably the reason we haven’t yet seen this – beyond the experiments to charge a little more for select opening weekend event films like The Batman – is because studios and exhibitors know that moviegoers would simply buy a ticket to the cheapest feature and then theater-hop. By keeping pricing consistent at the theater-level, my imagined “second run” model seems much more practically implementable.

Certainly, there are ways to go to the movies at cheaper-than-full-freight rates. Discount Tuesday is a massive success at most of the chains that offer it; just check out the Tuesday night attendance at the country’s best-performing theaters, like the AMC Burbank 16. But if Tuesday isn’t a convenient night for you, you’re sunk. The same goes for early morning pricing. There has to be a better, more across-the-board way to capture the moviegoers for whom price is a major concern, especially for non-event films.

Making viewers aware of ticket price deals is also a key hurdle that first and second run designations might help make clearer. One of my personal favorite recent retro multiplex discoveries was the Cinemark Movies 8 in Chino, where tickets are still just $6 for matinees and $9 in the evenings. (Yes, in California, in 2023!) The venue is no-frills, but the projection is good and it gets the job done; plus, you get to step back in time to the early ’90s. When I attended on a recent off-weekend for the box office (bomb Shazam! Fury of the Gods was the top ticket), there was still relatively healthy attendance. But the theater still felt like the area’s best-kept-secret; how many at the nearby Harkins Chino Hills 18 or AMC Dine-In Montclair Place 12 knew they could be seeing the same movie for as little as half the price?

This is all mostly just to say: the next time you think about or discuss “the theatrical window,” it’s worth considering whether that should remain such a monolithic term. Especially with limited remaining revenue opportunities in the physical media (DVD/Blu-Ray/4K UHD) space, it seems to me that we need to think more about the intermediary steps between “first run” and streaming. The old discount model may just offer us some newfound wisdom as we do.