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Justice Department to change how studios distribute films by revoking decades-old rules (US)

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Justice Department to change how studios distribute films by revoking decades-old rules (US)

Postby MrFredPFL » Thu Nov 21, 2019 2:04 am

Story :

A number of shifts in the movie industry have altered the theater-going experience in recent years. From the rise of streaming to the reliance on Chinese markets to the emergence of superhero blockbusters, everyone from ticket-buyers to studios have been affected. Now it looks like another drastic change is on the horizon, as the Justice Department is moving to revoke a decades-old ruling that could have a massive impact on film distribution.

According to The Wall Street Journal, the DOJ is readying a motion in federal court to terminate the Paramount consent decrees. The rules came into place in 1948 following a lawsuit the government filed against the major movie studios in the late 1930s. When the DOJ won the case, a number of distribution practices became illegal, which Slashfilm summed up nicely: “block booking (bundling multiple films into one theatre license), circuit dealing (entering into one license that covered all theaters in a theater circuit), resale price maintenance (setting minimum prices on movie tickets), and granting over-broad clearances (exclusive film licenses for specific geographic areas).”

The DOJ thinks these rules are outdated in the modern age. So what would happen if they were no longer in place? For one, studios could own theaters again, meaning there’s the potential of a Netflix Multiplex, or a new Amazon subscription tier that includes two screenings a month in an actual cinema. In turn, that could leave people in smaller markets with even fewer choices when it comes to a night at the movies.

More pressing, there’s major potential for studios to squeeze theater owners, especially smaller, independent operations. Suppose Sony spends millions on a new Men in Black film they know is a stinker; instead of letting it bomb, they could package it with other movies, forcing theaters to screen the crappy sequel even if no one’s buying tickets. What’s worse, distributors could sell these blocks sight unseen, denying theater owners the chance to determine which films they put up on their screens.

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