Picturehouse managing director Clare Binns and Vue CEO Tim Richards offered differing outlooks on the condition of the UK exhibition sector, speaking at the latest UK cross-party Culture, Media and Sport Committee yesterday (Tuesday, April 23).
“The industry’s in a bit of crisis at the moment, because it doesn’t really know where the future is,” said Binns, responding to a question from Committee chair Caroline Dinenage about how the next 10 years will look for the UK industry. “The franchise movies are costing more to make, and the profits are less than they were.”
Binns acknowledged the success of two original films last year through the Barbenheimer phenomenon, but said that US studios moving towards original films “is like turning a giant ship”.
Alongside distribution operation Picturehouse Entertainment, Binns runs Picturehouse Cinemas, the 26-site boutique exhibition circuit. Operational costs have become a major threat to its existence, she said.
“It’s going to be very hard not just for Picturehouse but for the mom-and-pop cinemas – their costs have gone up so much,” said Binns. “The utilities have gone up over 40% over the last couple of years. The costs of running those cinemas is making it almost impossible for them to survive in many cases.
“I don’t know the answer of when the audiences will be back. All I do know is it’s very costly for those cinemas to wait for those audiences to return.”
“I’m a little more bullish. We as an industry leading up to the pandemic were breaking records both in the UK and globally,” said Vue CEO Richards, noting the record-breaking year for exhibition in 2018 and similar figures in 2019. “We got hit very hard during the pandemic – one doesn’t plan for full closure.”
A “small, fragile recovery” last year was further delayed by the Hollywood strikes. “This year there are some amazing movies coming out of all genres, both British, foreign and Hollywood; but there’s just not enough of them,” added Richards, who cited 35% fewer films released in 2022 than pre-pandemic. That improved to 20% fewer last year with a similar or slightly worse figure expected for 2024.
“This is a business that is worth saving. It wasn’t broken and is not broken today,” said Richards. “We revitalise high streets, we drive footfall to shopping centres where retailers have been suffering. We have been growing from strength to strength and I think you’re going to see that return.”
Programming
Richards and Binns also disagreed on the difference between multiplex and arthouse cinema programming.
“There is no such thing anymore as an independent cinema, an arthouse cinema or a major cinema,” said Richards. “Screens are all within one ecosystem – we are all screens and we all deliver films.
“Arthouse cinemas in the classic sense are showing the same movies we are showing, day in, day out,” he continued. “I’m a massive fan of Watershed [in Bristol], but every major show for the next week is Civil War. A few weeks ago, if you looked at the top 100 classic arthouse cinemas, every single one was showing Dune: Part Two and a host of commercial movies.”
“I’ll do a bit of defending for Watershed and the likes of us,” responded Binns. “Yes, we did all play Dune; but we were also playing lots of other films as well. It wasn’t quite as simple as that.”
The third speaker on the panel, Alex Hamilton, Studiocanal UK CEO, shared Richards optimism on the global film industry’s post-Covid resilience – and Binns’ pessimism on “the British film industry’s role within that”.
“Events like Barbenheimer were orchestrated out of Los Angeles,” Hamilton told the committee. “It’s important if we want to establish the notion of a British film industry over the next 10 years, that we consider how it can have a commercial impact, particularly in its home market. We have to recognise that the commercial performance of UK films is under very serious threat.”
He cited Studiocanal UK having two of the three highest-grossing UK films of this year to date, in Wicked Little Letters and Back To Black, at £9.4m and £6.4m as of last weekend.
“British audiences do want to see films about identifiably British subject matter,” said Hamilton.
Marketing
The challenge is with marketing, with the major studios able to spend large sums on global rollouts with which even companies the size of Studiocanal – a subsidiary of Vivendi-owned Canal+ – cannot compete.
“Even when we’re doing Paddington In Peru at the end of the year, which will be the biggest British film of the year by some distance, we still needed a US studio [Sony] to come up with part of the financing,” said Hamilton.
It is a struggle to find audiences for UK films without that studio backing, even with critical and festival acclaim, Hamilton added. “Scrapper, Rye Lane, How To Have Sex – all universally admired movies, all seen by not a lot of people at the cinema.
“The reason not many people went is the economics for Clare and for many of us,” he continued. “You can’t commit the same kind of marketing spend as if you’re backed by a Hollywood studio that is giving you that global hit.”
Picturehouse Entertainment released Charlotte Regan’s Scrapper to a £580,000 total last year. Even that figure only came about through significant marketing spend, said Binns. “At the end of the day, it was how much money we spent on that film in order to get it visible to an audience.”
Hamilton began his remarks acknowledging the success of recent decades in admissions, and “the explosion of content available to UK audiences”, both in cinemas and on streaming platforms.
“The advent of streamers and the robust work done by exhibition and distribution and indeed Hollywood has led to a great proliferation of content,” said Hamilton. “[But] it has shifted the playing field away from people going to see British cinema.”
Hamilton said box-office analysis shows “the biggest films getting bigger, the middle falling away a bit, and a lot of films being released each week that aren’t seen by an audience anywhere.”
Richards extolled the use of artificial intelligence in programming. “We use AI to book our screens exclusively,” said the Vue CEO. “Our AI has been an incredible tool, because we know what our customers want to see right across the entire country.”
He cited the example of a Vue venue in Inverness in Scotland, which regularly plays Asian films to cater to a local Asian community. “We have that level of granularity in our business.”
Skills
The trio were speaking at the second CMS Committee session of the day. Earlier on, Mark Cosgrove, head of cinema at Bristol’s Watershed cinema, and Catharine des Forges, director of the Independent Cinema Office, had spoken about the funding challenges for the independent exhibition sector.
“Investment in skills and exhibition is ridiculously low,” said des Forges. “In order for people to be innovative and creative, you still need some resource. Many independent cinemas used to have education officers, marketing officers or audience development officers – the sorts of people who would develop skills. We’re seeing fewer of those staff in venues.”
Additional funding could come from “a tax relief on risk-taking” said Cosgrove, similar to those that benefit art galleries and theatres. “When you’re taking the risk on talent development, audience development – that unknown area where the industry is risk averse – there should be some tax relief,” he said.
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