Pearl & Dean's Kathryn Jacob: cinema can still thrive despite rush to streaming

Jacob: 'We must stop thinking of cinema and streaming as an either/or situation'
Jacob: 'We must stop thinking of cinema and streaming as an either/or situation'

CEO of cinema ad sales house is bullish about industry's prospects as society emerges from the pandemic.

The rush of new high-end content going straight to streaming platforms is not a "major threat" to cinemas, Kathryn Jacob, chief executive of Pearl & Dean, has insisted.

With cinemas closed for much of 2020 in the UK and other countries, film distributors have looked to streaming as a way to release some of their titles, although the majority of this year's planned big releases, including Bond film No Time to Die, have been pushed back to 2021.

Last week (10 December) at its 2020 virtual Investor Day, The Walt Disney Company announced a huge programme of new content for Disney+, including several new films exclusive to the streaming platform. But it also confirmed that major releases over the next two years, including Pixar films Seeing Red and Lightyear (the fifth Toy Story film), and Marvel movies such as Black Widow and Shang-Chi and the Legend of the Ten Rings, will be released exclusively in cinemas.

Disney is not the only company to increase its focus on streaming however; Warner Bros also recently announced it would release all of its 2021 titles simultaneously in cinemas and on HBO Max in the US.

But Jacob said that this kind of "hybrid model" was something "we've had for a while" – pointing to The Secret Garden, released in October in both cinemas and on Sky Cinema, which she said "did great numbers for our clients".

Jacob said: "The latest Disney announcement and its further investment in its streaming platform Disney+ should not be seen as a major threat to cinema. In order to encourage users to stream, there needs to be a consistent run of new content, and a lot of this new investment is going to be bespoke content based on film spin-offs, which fit well with the streaming format.

"If you've got content, and it's sitting on the shelf, you'll want to get it out somehow. It is ever thus that you'll make more money by doing a theatrical release, and then a streaming release. You're not going to make the same amount of money out of a streaming release that you'll make out of putting it into a cinema."

Disney's announcement of its cinema-exclusive titles showed that "they still place a lot of value in cinema", she added. "It is a very strong and well-established revenue driver for them. We must stop thinking of cinema and streaming as an either/or situation as there are benefits to enjoying both experiences."

Cinemas have suffered in 2020 as movie theatres were first forced to close in March and have gone on to experience a series of openings and closures in line with government coronavirus guidelines.

Pearl & Dean has a share of about 20% of the UK cinema advertising market, with most of the rest controlled by its larger rival DCM. 

Forecasts show that the impact has been severe: in its latest adspend forecast this month, Group M said cinema advertising would decline by 80% in 2020, before rebounding next year to 52% of 2019's level. Those numbers are significantly worse than in the most recent Advertising Association/Warc report in October. 

But Jacob said the drastic impact of the pandemic on the sector had not affected the perception of cinema in the eyes of advertisers.

"I don't think their perception of cinema has changed, I think that they know they get a very immersed, engaged and attentive audience," she said. "It's possible to buy audiences very specifically against certain films or you can just do it by buying bums on seats."

This year's top cinema advertiser has been Apple, which has topped the list both for Pearl & Dean's venues and across the market as a whole in 2019 and 2020. Most of 2019's top cinema advertisers, including Amazon, Samsung, Sky, Audi and Comparethemarket owner BGL Group, are again in this year's top 10.

"At no stage in any of the discussions that we've been having with people has anyone turned around and said: 'Actually, you being shut for a period of time has made me completely reappraise whether I use cinema in my media plan,'" Jacob continued.

"In fact, I've had clients saying: 'We've really missed you and that incredible juxtaposition with really great stories.' In a world of huge amounts of distraction and a here today, gone tomorrow mentality, you've got people sitting in front of ads and I have been in cinemas where people have clapped ads."

UK consumers are expected to make a return to cinemas for the release of Wonder Woman 1984 on 16 December, but large areas of England, including London, are under tier three restrictions, meaning cinemas cannot open. Warner Bros is reportedly working on a deal with Sky to stream the blockbuster, which will be available in the US on HBO Max.

Even when discussing London's progression to tier three, Jacob was hesitant to take the release of any singular release as indicative of overall changes, instead saying there should be more of a view for the future from April.

"I would be reluctant to take one release as symptomatic of anything because they're reviewing the tiers. I don't think you can pin any kind of systemic change on one release as it's not an accurate measure – we're in a really strange time. And so I think you'll have a more balanced picture, by the end of April when we've got cinemas open, more vaccinated people and a bit more of an established slate of releases."

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