The Fracture of the Theatrical Release Window, PART III: The Obscene Movie Fallacy

For Part I, click here. For Part II, click here.

Back in the 1960s,  a new kind of specialty movie theater gained in popularity among the movie-going public. At first there were only a handful, but within a decade or so 750 of these theaters had sprung up across the county and were doing a brisk business. Their star was quickly to fade, however, and by the time your humble blogger entered this world in the mid-80s, the burnout was nearly complete. No matter, for even if I had not already already been banned from going to regular theaters by school and parental fiat, I would still have been banned from these specialty ones by state law long after they had all but completely faded to black. They were showing porn flicks, after all.

I bring up adult movie theaters (as they're called in polite company) because their arc gets at the heart of what bothers me about NATO's open letter arguing against shortening the theatrical release window. As I said in Part II, NATO puts itself in an awkward position by arguing on one hand that simultaneous releases on DVD and other formats will cannibalize business, while on the other hand maintaining that theaters are the "optimum...exhibition arena."  These two notions are not mutually exclusive, but if the former is true then the latter probably isn't.  The mistake NATO is making is what I dub The Obscene Movie Fallacy*, which is to confuse what's optimum with what's really a lack of options.

*Notice how the name works on two levels, just as most summer movies aspire to do.

Adult movie theaters did well for many years because they represented the only option to see a pornographic film. But believe it or not, a public theater did not represent the optimal porn exhibition arena for most viewers. When given the option, most people preferred to watch their porn in the privacy of their home, first on VHS and now on the internet. The theaters went bust, and not because there was no 'NAAMTO' to defend the adult movie going experience.

In the case of adult movie theaters, the options revealed an overwhelmingly popular optimum, but when tastes are more varied, options also allow for optima (if you like). Seeing a big-budget Michael Bay-type film in an IMAX theater is best in some technical sense, but as much as NATO might like it to be, this is not the only criterion for optimality. For those who hate loud teenagers, the inability to press pause for a bathroom break, or ruptured ear drums, IMAX is hardly ideal.  They'll take the lesser picture quality for a more intimate and convenient experience, thank you very much.

So, is a theater the optimum exhibition arena? The correct and tedious answer is that it is 1) all the time for some, 2) sometimes for others, and 3) never for the rest. NATO knows this, but evidently think they are best serving their members by denying this and preserving their privileged position. Maybe I'm just a naive outsider, but this tack seems shortsighted. Facing bracing competition is a difficult prospect, but it makes more strategic sense than relying on the dividends of a tenuous agreement.

What's more, the key assumption behind the release window system (that different formats of a movie will compete with each other in zero-sum fashion) may not even be true.  When you stop peddling the nonsense that there is only one optimum (and thus one type of movie viewer), you'll recognize that while Transformers 3 is the same film no matter the format, it is not the same product. A Blu-ray is not the same thing as a theater screening is not the same thing as video-on-demand. As a result, you'd expect different people to be interested in each product.

Since we're talking about movies, let's make it visual. Here's how NATO implicitly imagines the movie viewing public (assuming simultaneous releases):

In this view, each movie has one audience which divvys itself up according to preferred format.  Each format competes directly with another, with one format's loss of an audience member being another's gain. The choice of format is one-off and final: buying a movie ticket precludes buying a DVD--FOREVER!

Here's how I suspect things look:

Here, each format (rather than each movie) has an audience. Each audience has three sub-groups: those who consider watching in one format (e.g. the green portion), those who consider watching in two formats (e.g. the yellow portion), and those who consider watching in all three formats (e.g. the red sliver). Who knows how well I got the proportions right for any given grouping, but they exist.

There are two important things here to recognize. The first is that each format of a given movie has some dedicated audience for whom choice is irrelevant. Maybe they don't have DVD player and hate crowds so they rent VOD, or maybe they're NATO acolytes who think  it's the theater or bust.  Whatever the reason, simultaneous release windows matter not a whit to them, and shouldn't to NATO either.

The second important bit is even when there is overlap (red, purple, pink, etc), the choice of format is by no means a mutually exclusive one. A movie buff might see a film in the theater four times and still buy the Blu-ray set.  When I watched Saving Private Ryan on DVD for this first time, I pined for the chance to see the D-Day sequence in a theater. Yes, these overlaps are also where zero-sum choices occur, but it's not obvious what the net effect is in these (probably) small areas.

I'm running late for an afternoon trip to the movies (truly), so here's the last thing I'll say in this meandering post of mine. I'm optimistic about the prospects of simultaneous release because it would allow for more specialized catering to movie viewers' tastes. Some worry that only big budget tent-pole movies would survive in this environment, but I doubt that's true. Instead, attentiveness to format would allow for a more diverse array of movies to be profitably made. Releasing in a theater is high status, but it's high time we learned that not all movies are appropriate for theaters. For once we may be well advised to let porn be our guide.