Will audiences go back to movie theaters after the pandemic ends?
New York (CNN Business)Adam Aron, the CEO of AMC Theatres, doesn’t just believe it’s safe to go back to AMC to catch a movie, he says he might even see a double feature when the world’s largest movie theater chain reopens next month.
“You can be sure that I’ll be wearing a mask,” Aron noted.
AMC Theatres (AMC) announced Thursday that it would start a phased reopening of its US theaters next month with new health and safety measures. The news comes as new coronavirus cases are spiking across the country.
Aron spoke with CNN Business on Thursday about the initiatives the company has taken to help protect its guests, and why he believes Americans are ready to go back to the movies.
This interview has been edited and condensed.
I’ll ask you a similar question I asked the Disney CEO about Disney World reopening. I’m an AMC A-List member, tell me why it’s safe for me and my family to go see a movie at AMC.
As is widely known, AMC made a decision in mid-March to shut all of our theaters in 15 countries… We’ve had three full months to plan the reopening of our AMC theaters and we didn’t waste those three months. We consulted with scientists. We consulted with experts. We partnered with Clorox (CLX). We hired as consultants faculty of Harvard University School of Public Health, and we’ve put together a sweeping, comprehensive initiative called “AMC Safe & Clean” that looks at a whole host of initiatives to make our theaters safe, both for our guests and for our employees.
The things that you would expect we’re of course doing. Social distancing, seat limitations, intensify creating protocols, employee health procedures, contactless ticketing, mobile food and beverage ordering. But we’ve also invested millions of dollars in high tech solutions to purifying our theaters. We’re buying electrostatic sprayers, HEPA vacuums, MERV 13 ventilation air filters. We’re taking the safety and health of our guests and our associates as seriously as we possibly can.
Ok, so how do you plan on enforcing a lot of the health guidelines of “AMC Safe & Clean?” For example, you ban using cell phones and talking, but people still do that. What happens when people don’t follow the rules?
Well, as you say, we have put in a lot of procedures designed to make theaters safe. Some of those are within our control. Some of those are within our guests’ control, and there will be a tremendous amount of communication with our guests before they get to the theater, while they’re at the theater, after they leave the theater, reminding them of how they can keep themselves and their fellow moviegoers safe. And we’ll do our best to see that our policies are followed.
There’s a limit to how much we can do, of course. If someone is irresponsible and we catch them, we can ask them to leave the theater. We’ve done that often in pre-pandemic times and we’ll do that often in post-pandemic times.
Are you requiring moviegoers to wear masks at all of your theaters?
We are requiring moviegoers to wear masks in those jurisdictions where it is required. We are requiring all of our associates, all our employees, to wear masks all across the country. And we are strongly encouraging our guests to wear masks all across the country, but not requiring it. And we’re doing that for a couple of reasons.
One, the circumstances locale by locale are very different… It’s not accurate to say that there’s the same level of risk everywhere across the country. The United States is a big country with very different local conditions.
The second reason is what we’re committed to at AMC is the cleanliness of our theaters and the safety of our guests. That’s our focus, and we want to keep the politics out of our theaters.
It’s well known that there are some parts of the US population and some parts of the country that are resisting wearing masks even though the scientists are saying it’s a very good idea to do so. We didn’t want to step into that controversy. So what we’re doing is we’re encouraging people to wear a mask, but not necessarily requiring it.
And I can tell you this, on July 15, when we start opening our theaters, I’m going to be going to a movie theater and on the very first day. I might go to a double feature, and you can be sure that I’ll be wearing a mask, leading by example.
AMC is opening next month at 30% capacity. That’s still a lot of people sitting in a room for hours at a time when cases are going up. Do you think it’s safe to sit in a closed room with a good number of people for hours right now?
Well, number one, there’s a difference in your question when you said right now, and July 15 when we’re opening theaters. That’s a full month from now. As each month has gone by in the past three, we’ve seen that the coronavirus situation is quite different than it was in the preceding months. We did not make a decision to open our theaters on June 18. We made a decision to open our theaters on July 15.
What the experts are telling us is that social distancing is what is important. And by limiting seat capacity to 30% on July 15, that puts a lot of geographic territory between our guests, especially when you remember that most of our guests come in parties of two. So if you are occupying two seats and we’re only selling 30% of our seats, that means that there are another five, six seats around you that we’re leaving vacant.
Third, and again, remember a big part of “AMC Safe & Clean” is talking to scientists and experts both at Clorox and Harvard School of Public Health. And what they’re telling us is that ventilation is an extremely important part of how you described that enclosed space. Remember that our theaters have very high ceilings. They occupy a tremendous amount of cubic space and we’re punching up our HVAC systems and our air filtration filters dramatically. Prior to the pandemic, we probably would have had MERV grades three or four air filters in our auditoriums. Now we’re going up to MERV grade 13 air filters with any HVAC system that can handle them. That’s more than triple the rating of the kind of filtration that we had before.
So as we punched up ventilation, including more fresh air flow, and put in filters that capture 99% of air particulates, yes, we think that a month from now our theaters are going to be safe. And that’s what our scientists and experts are telling us.
What would your response be if a new outbreak of COVID-19 can be traced back to a screening at an AMC theater?
We would instantly notify guests who were at that theater. One of the great advantages that AMC has is that we have a very popular loyalty program. More than half of our guests who buy tickets do sell and track their purchases with us. Similarly, more than half our guests buy tickets online, and it’s not necessarily the same half. So you add those two together and about two thirds of our guests have identified to us who they are, with a name, with an email address, with a phone number, with contact information. And so we would instantly notify people if that situation arose.
We would instantly do a massive, deep dive cleaning of that theater. We might shut that theater for some period of time. But hopefully that won’t be the case, and the sweeping, comprehensive protocols of “AMC Safe & Clean” will prevent that from happening.
Everything consumers do now — from shopping to going to a park — is a personal, calculated risk. Why is going to the movies worth that risk?
So let me just tell you what every American feels. We have been cooped up and trapped in our apartments and homes for the past three months. And people are so eager to get out of the house and do something fun to escape from the monotony of being cooped up at home, and to get out and about and experience some part of life that’s normal as we know it.
Last year in the United States, more than a billion tickets were sold at US movie theaters… People want to be entertained. People want to be amused. People want to escape. And because we at AMC are so committed to operating our theaters cleanly and safely, we think we can give people a great forum to get out of the house and enjoy a little bit of normal life.
AMC has banned Universal films over a dispute regarding “Trolls World Tour” going directly to digital. Next year, Universal has three major blockbusters on the schedule: “F9,” “Jurassic World: Dominion” and “Minions: The Rise of Gru.” Are you telling me, an AMC customer, I’m going to have to take my business elsewhere to see those films?
Yes, assuming that we can’t have discussions with Universal that solve our concerns. Remember that AMC has been showing Universal movies happily and profitably for decades. We didn’t change the status quo, and we didn’t actually have any protest about “Trolls” at all. You didn’t hear one word of objection from AMC about “Trolls.” We understood that our theaters were shut, that they have a business to run, and that they felt they needed to take “Trolls” to the home rather than waiting.
Our concern is that Universal said that once theaters reopened, they were going to try to take movies to the home and theaters at the same time. It wasn’t “Trolls” we were concerned about. It’s the movies after “Trolls” that we’re concerned about. And if they take movies to the home and theaters at the same time, they’re the ones who are changing the status quo and they would make it unprofitable for us to play Universal movies in our theaters.
So if you actually look at the letter that I wrote to the chairman of Universal Studios back in April, I said that that Universal had broken the business relationship between Universal and AMC by changing the status quo and that we would have to come up with a new business relationship if we were going to accommodate their new desires. We’re in active dialogue with Universal now. We’ll see where that leads, but it is our current plan not to show Universal movies if we can’t do so profitably.
AMC said earlier this month that there was “substantial doubt” about its future because of coronavirus. What needs to happen to avoid that?
We need to open theaters again, and we need to get our guests coming back to theaters. It’s that simple… The single best thing we can do to assure our viability for the long haul is get our theaters back open again, and have guests come to theaters, be entertained, be amused. Tell their friends they thought it was clean, they thought it was safe, and that they too should go to the movies.
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