The war between AMC and Universal is over before it really began as the two movie giants strike a historic new deal that may change the future of cinema

By Alexia Fernandez
July 29, 2020 04:42 PM
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Trolls World Tour
DreamWorks Animation

The movie business is changing at a rapid pace amid the coronavirus pandemic that has shut down cinemas around the world.

Three months after AMC Theaters, the U.S.'s largest theater chain, declared it would refuse to play films released by Universal Pictures, the two companies have struck a deal allowing Universal films to once again play at AMC venues.

Universal now has the right to release its movies on premium video-on-demand after just 17 days of playing in theaters, according to The New York Times. The company can also be selective about which films it chooses to release digitally within that short timeframe, and opt to extend that window for some of its bigger franchises.

The new deal between the two companies breaks convention on what used to be a nearly three-month window for movies playing in theaters before making the films available on any streaming or rental platform.

"The theatrical experience continues to be the cornerstone of our business," Donna Langley, chairman of the Universal Filmed Entertainment Group, said in a statement. "The partnership we’ve forged with AMC is driven by our collective desire to ensure a thriving future for the film distribution ecosystem and to meet consumer demand with flexibility and optionality."

Universal, which controls major franchises such as Trolls, Fast and Furious, Jurassic World and Despicable Me, has sought to shorten the theatrical window for years but backed down amid boycotts from AMC and other large theater chains in the U.S., according to The Hollywood Reporter.

That all changed amid the coronavirus pandemic, when Universal released Trolls World Tour straight to video on demand in April, earning an unprecedented $100 million in rentals in its first three weeks of availability, according to the studio.

Jurassic World: Fallen Kingdom
Universal Pictures

AMC declared war on the studio in late April, with chair-CEO Adam Aron writing a strongly worded letter to Langley, saying NBCUniversal CEO Jeff Shell was "breaking the business model and dealings between our two companies."

"It assumes that we will meekly accept a reshaped view of how studios and exhibitors should interact, with zero concern on Universal's part as to how its actions affect us," Aron wrote, according to THR, adding the company assumes it "can have its cake and eat it too."

"It is disappointing to us, but Jeff’s comments as to Universal’s unilateral actions and intentions have left us with no choice," Aron continued. "Therefore, effective immediately AMC will no longer play any Universal movies in any of our theaters in the United States, Europe or the Middle East."

Aron made it clear "AMC is willing to sit down with Universal to discuss different windows strategies and different economic models between your company and ours," but that since those discussions haven't taken place "our decades of incredibly successful business activity together has sadly come to an end."

Universal has reportedly also earned millions in $19.99 digital rentals from other titles as well, including The Invisible Man and The Hunt, according to multiple reports. These films had initially been in movie theaters when cinemas nationwide shut down due to the current health crisis and were later released early on demand.

The studio has other movies scheduled for release including F9, Halloween Kills, The Croods 2, Jurassic World: Dominion, Sing 2 and Minions: The Rise of Gru.