Sie: Movies will premiere on cable and satellite
Even before announcing his formal retirement plans, Starz Encore Group Chairman and CEO John Sie dropped a controversial bomb, predicting that movies will regularly premiere on cable and satellite rather than in theaters within the next 10 years.
Sie, who made the prediction while speaking at the Harvard Business School Media Conference, cited key drivers such as high-definition television penetration and high-end home theater technology.
"Last year, the theatrical screenings of films generated about $5 billion in revenue for the studios, compared with $4 billion from cable and satellite," Sie said. "Clearly we are rapidly approaching the tipping point where it will make more sense for studios to release their films first on cable and satellite, and later in the theaters."
By way of example, he noted that a studio could generate $200 million in revenue if just 20 percent of HD homes paid $19.95 to see a premiere, which is roughly the cost for two to go to the theater to see a first-run flick.
Still, Sie said he doesn't believe HD and home theater technology will kill the movie theater model.
"Millions of Americans still love the experience of getting out of the house and going to a theater and always will," he said. "But in the future, big films will debut in the home and create the buzz for their theatrical releases, rather than the other way around."