AMCzon sorta works, actually

Amazon is reportedly exploring acquisition plans for AMC Entertainment, the largest theater chain in the world. According to sources familiar with the matter, the tech giant aims to use AMC's nearly 1,000 locations across the US, Canada, and the UK as "marketing weigh stations" to promote the 12-15 movies Amazon Studios has committed to releasing in theaters each year.

Though analysts say the deal is very unlikely to go through, it does raise the question: why aren’t more studios buying their own theaters?

The answer is simple: because until a few years back, they literally couldn’t.

⏮ Let’s rewind the tape… to 1917, ten years before “talkies” began replacing silent films, when studios began purchasing theaters. By 1930, five major studios owned 17% of all theaters across the country.

But 17% isn’t that much, right? Well, if the studios hold their movies from playing in any other theaters, then it certainly can be. And so it was – that 17% of theaters accounted for ~70% of box office receipts for first-run movies.

• This, for the other 83% of theaters (especially the mom and pop independents), was sort of a big bummer. So the indie theaters sued the studios and won in 1948 – when the Supreme Court established the Paramount consent decrees, banning major studios from owning and operating movie theaters.
• Though as modern poets, The Five Maroons, once said, “nothing lasts forever.” In 2020, a federal judge in the Southern District of New York ended the decrees, claiming they’d “served their purpose and… may actually harm American consumers by standing in the way of innovative business models for the exhibition of America's great creative films.”

👀 Looking ahead… The theatrical landscape could soon be dominated by tech giants with streaming platforms. A24 bought the Cherry Lane Theatre in NY a few weeks ago, and Netflix purchased LA’s Egyptian Theatre in 2021 (plus Apple has already committed $1 billion/year towards theatrical releases).