CinemaCon 2019: Fathom Events Looks Beyond Streaming to Disrupt Exhibition
Even as CinemaCon begins under a cloud of streamer anxiety, event cinema is growing fast. In an effort to lure moviegoers to off-peak screens, some 60 theater chains have turned to six-year-old Fathom Events and it now ranks 12th among U.S. distributors. In 2018, Fathom released 164 titles across 277 event dates to more than 5.1 million people; 23 titles surpassed $1 million at the box office.
As the powerful theater chains fight to maintain the status quo in a drastically shifting environment, Fathom stands out in sharp contrast as a company that is rapidly learning and innovating, much like such disruptors as Netflix. That is what theaters need to do in order to adapt and survive.
Consider the January box office, which suffered its usual post-holiday doldrums. Not at Fathom, where January delivered a record $11-million month, spurred by disparate titles like “The Met: Live in HD: Carmen,” Pathé Live’s “BTS World Tour: Love Yourself in Seoul,” and the 80th anniversary reissue of “The Wizard of Oz,” which became Fathom’s highest-grossing rerelease at more than $2 million. By the end of 2019, Fathom expects its live cinema broadcast network to total more than 1,100 cinemas and 1,700 screens.
While Fathom content usually veers far from the world of superhero blockbusters, it finds its tentpoles on cable, broadcast and Broadway. Titles range from the populist (AMC’s “Walking Dead” finale, Mayweather vs. McGregor) to the tony (the Bolshoi Ballet, National Theater Live, the Metropolitan Opera), along with specialized-audience targets that include The Grateful Dead (“Meetup 2018”), Studio Ghibli (“Princess Mononoke”), and the BBC’s “Doctor Who” (five season premieres). It also supplies content to 800 churches via the faith-based Fathom Affinity Network.
Fathom also finds gold in major studios, as in its recent partnership with Warner Bros. for the release of Peter Jackson’s “They Shall Not Grow Old.” The colorized World War I documentary opened on over 1000 screens in December 2018 and again in January, at which point the ecstatic Warners took the film to 500 theaters in February 2019 for a record stateside total of $16 million.
Given the exhibitors’ anxiety over streamers’ encroachment, why doesn’t Fathom encounter the same pushback? One big reason is lies in its ownership; it’s co-owned by AMC, Cinemark, and Cineworld’s Regal Cinemas. Also, most of its screenings are brief, one- to four-day hits — not enough time to cannibalize, but plenty to build awareness, fan media attention, and awards qualification. Those short stints also allow room for extras like Q&As, or backstage footage and interviews with cast and crew.
Fathom CEO Ray Nutt considers the “incremental” Fathom window — which falls between other platforms, like further theatrical release, or VOD — as a promotional opportunity. Fathom advertises its titles for 30 days with standees and posters, as well as trailers that run on up to 20,000 screens.
“People are realizing we’re a promotional vehicle, at end of the day,” he said. “We’re bringing Broadway to theaters as well. Musical ‘Bandstand’ did well on Broadway, it lost its Broadway theatre, then we brought it back. Disney theatrical did ‘Newsies’ and brought it into theaters, as well as then taking it on the road.”
All of this is achieved with lower upfront costs for Fathom; unlike many pure-play distributors, it works on a revenue-sharing model and doesn’t provide minimum guarantees. “Companies like the BBC are typically doing something else with the content,” Nutt said. “They get to make money as well with us.”
Nutt expects to see more suppliers as they become convinced that Fathom offers cross promotion rather than cannibalization. “We’re 1 or 2 percent of the total box office in North America,” he said.
Fathom titles vary in size and scope. Its partnership with Turner Classics, which books a dozen TCM slots year round, led Fathom to supplement them with its own branded series, Spotlight. And when distribution chief Dave Hollis left Disney to run the online lifestyle business owned his wife, Rachel Hollis, he reached out to Nutt to book their documentary “Rachel Hollis Presents: Made for More.” The show sold 5,000 tickets on the day Hollis previewed it on her site.
Fathom is also looking to expand via the Tugg on-demand model, which would allow it to identify customer interest in more obscure indies and encore showings. “When they can’t get traditional theatrical distribution, they look to us,” said Nutt, who brought back The Orchard’s climbing movie “Dawn Wall” for a second round of showings after it scored with audiences.
Would Fathom ever show content from streamers like Netflix? They’ve had discussions about it, but so far that’s a non-starter for their big circuit owners. That’s too bad, because nimble Fathom has the ability to innovate. They’ve brought in former HBO executive Andrew Goldman) to curate more quality programming. Another area to mine is all the data available to Fathom from their owners, which have launched loyalty and subscriber clubs, Regal, AMC and Cinemark.
“You can’t have enough data,” said Nutt. “We’re here to engage people’s passions. There are so many genres like anime and science-fiction. We’re delivering content on the big screen so people come together and share that experience. The challenge for us is targeting and marketing, how to find people and promote that content.”
Coming up in 2019 are more TCM Big Screen Classics, including “Alien,” “My Fair Lady,” “When Harry Met Sally …,” “Lawrence of Arabia,” “Field of Dreams” and “To Kill a Mockingbird,” as well as the long-awaited Terry Gilliam feature, “The Man Who Killed Don Quixote,” starring Adam Driver and Jonathan Pryce.