Movie Theaters Battle to Stay Open Despite Shelved Films, But for How Long?

In San Francisco, Alamo Drafthouse has begun staggering seating after California Gov. Gavin Newsom restricted gatherings of more than 250 people.

Similar to many other businesses, movie theaters were left reeling Thursday by fast-unfolding events related to the coronavirus pandemic, including Broadway going dark.

In California and New York, cinemas scrambled to make sense of new crowd-control measures that limit gatherings to 250 and 500 people, respectively.

At the same time, Paramount and Universal said early Thursday they were delaying the releases of upcoming event pics, including A Quiet Place Part II. The sequel to box office blockbuster A Quiet Place was due to hit theaters on March 20. Universal Pictures' F9, which would have gone out over Memorial Day weekend in May, is being pushed back a year to April 2021.

Hours later, Disney announced it is pushing back its upcoming releases of Mulan, New Mutants and the horror movie Antlers to later dates.

The reshuffling began a week ago, MGM announced it was relocating its release of James Bond pic No Time to Die from early April to November.

The refrain among distribution executives across Hollywood is the same: The situation is unprecedented. The country's largest theater circuits — AMC, Regal and Cinemark — aren't commenting publicly so far because circumstances are too fluid. As of Thursday afternoon, no movie theaters appeared to be closed in the U.S., even in hard-hit areas such as Washington state, the Bay Area, Los Angeles and New York.

"I don't think there will be a country-wide ban on theaters remaining open, but certain municipalities will be impacted," says Wall Street analyst Eric Handler of MKM Partners. "Ultimately, the decision to close will be made for them if everyone cancels their new releases."

The remaining event pics that remain on the April and early May calendar are Universal/DreamWorks Animation's Trolls World Tour (April 10) and Disney/Marvel's Black Widow seven weeks from now on May 1. Insiders say no decision has been made yet about Black Widow. Should those films relocate, cinemas would find it hard to justify keeping their doors open in the short term, according to numerous sources who spoke with The Hollywood Reporter.

"Everything is changing by the minute," adds Handler.

For the film industry, the landscape was already dire before the coronavirus began spreading in the U.S. Cinemas in China — the world's second-largest moviegoing market behind North America — went dark in late January and have yet to reopen on a wide scale. Now, all of Italy is under quarantine, while the box office is in free fall in South Korea and Japan. France is also under siege, while theaters have begun closing in Poland, Denmark and Norway.

All told, the hit on the 2020 global box office is already as much as $7 billion. That number could climb as high as $17 billion if the crisis continues through May.

In terms of new crowd-control rules, California Gov. Gavin Newsom on Thursday declared that gatherings should be limited to 250 people. He later added that certain businesses, such as theme parks and movie theaters, are generally exempt from the recommendation, although Disney later in the day announced that Disneyland would close for the rest of the month.

In San Francisco, the Alamo Drafthouse Mission has "deactivated sections of seats" in one auditorium where the seating capacity is greater than 250. "The room capacity is now capped at 250 until further notice. Furthermore, we are requesting that all parties leave an empty seat between their group and other parties. If you don't have an empty seat, you can see a manager who can move you to one of the empty sections. This process is manual now but we are looking to automate it in the very near future," read a note from Alamo co-founder Tim League in a blog post.

None of Alamo's other California theaters have an auditorium that seats more than 250 people. In Los Angeles, the Chinese TCL Theater seats more than than 900 people. As of Thursday afternoon, there were no plans to stagger seating. LA Live Regal in downtown L.A. has a large auditorium.

Generally speaking, many multiplex auditoriums across the country seat less than 250 people, although in larger locales, some can seat well above that number. Many circuits may keep blocks of seats empty, similar to Alamo and circuits in Europe.

Alamo also addressed employee pay. "Our employees' safety and security are extremely important to us. Coronavirus tests are covered by our insurance. If an employee is not insured, we will cover the cost of the test. While waiting for test results, we will pay for time away from work. If an employee tests positive, we will pay for the 14 days of quarantine sick leave. After that time, employees may utilize any paid time off or sick leave they have accrued," League said in the advisory.

March 13, 1:40 p.m. Updated with revised global box office numbers.