New York Gov. Andrew Cuomo will allow movie theaters in New York City to open with a limited audience capacity for the first time in nearly a year.
As part of the restrictions, theaters will only allow a maximum of 50 people to sit in any one screening (restricting capacity to 25 percent). Attendees must wear masks and sit in their assigned seats. The theaters will also have to implement advanced air filtration systems, according to Cuomo. While theaters outside of New York City have been allowed to reopen over the last few months, high case numbers in the city have prevented people from going. Theaters originally shut down because of the pandemic in mid-March 2020.
Allowing New York City theaters to open is a big deal, especially for studios like Disney and Universal, whose executives are likely worried about timing for upcoming big releases like Black Widow (May 7th) and F9 (May 28th). Ticket prices are much higher in key markets like New York City and Los Angeles (where theaters are still unable to open). Plus, New York and California make up 21.5 percent of all US filmgoing audiences. Not having those theaters open, even in a limited capacity and with higher ticket revenue, is catastrophic for movies that could potentially make $1 billion in pre-pandemic days.
While industry insiders speculated that Disney could move Black Widow to Disney Plus as a Premier Access title and then release the film internationally where theater attendance is better, it was also increasingly apparent Marvel Studios didn’t want to go that route. Black Widow is a $200 million-plus budget movie; moving it to Disney Plus, even as a $30 Premier Access title, would never generate the same initial revenue it could earn at a theater pre-pandemic.
Without New York City or Los Angeles, Disney likely would have delayed the film again. But with New York City theaters reopening, even at just quarter capacity, it likely gives studio executives hope that Los Angeles could follow in the coming weeks, and there may be a better shot at a decent release for Black Widow (well, by pandemic standards). Add in a rebounding movie theater business in key markets like China, one of Marvel Studios’ most important demographics, and Black Widow could break even — potentially even earning a slight profit.
The alternative is a situation US audiences saw with Wonder Woman 1984. With a production budget of $200 million and additional tens of millions in marketing budget, the film needed to generate at least a couple hundred million dollars to break even. That wasn’t going to happen in December 2020 with New York City and Los Angeles theaters closed, as well as restricted capacity at theaters in other states.
Warner Bros. decided to move the film to a simultaneous release, premiering it in theaters and on HBO Max in the United States on the same day. By the end of January, AT&T (Warner Bros.’ parent company) executives told analysts that Wonder Woman 1984 pushed a swath of new subscribers to HBO Max, boosting numbers to 17.2 million accumulated activations, more than double the number of activations in AT&T’s previous quarter (8.6 million). The film ended up making $159.9 million, with roughly 73 percent of that total coming from outside the US. To compare, the first Wonder Woman film earned $821 million worldwide with roughly 50 percent coming from the US alone.
It’s also a big win for theater owners, whose executives have asked Cuomo and California Gov. Gavin Newsom to open theaters in New York City and Los Angeles over the last couple of months. AMC CEO Adam Aron thanked Cuomo when theaters in New York state were allowed to open back in October 2020, noting at the time that the company continued “to work closely with state and local authorities about the reopening of New York City, which we now hope with increasing confidence is not far away.”
Still, studio executives and theater owners can’t predict if people will actually show up to theaters right now. As more vaccinations roll out across the country, people may feel safer about being in a theater with strangers while maintaining proper social distance. For others, however, it may be some time before they’re ready to watch a stranger six feet away toss popcorn in their mouth or sneeze.