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Cineplex employees work at a Cineplex in Toronto, on Oct. 6, 2020.Chris Young/The Canadian Press

The time it takes for a movie to go from the big screen to Canadians’ living rooms just got dramatically shorter.

On Friday morning, Cineplex Inc. Cineplex Inc., the country’s largest exhibitor with 1,687 screens, and Universal Filmed Entertainment Group, one of Hollywood’s biggest studios, announced a multiyear deal for a “new dynamic window agreement” to help both companies navigate the industry-shaking effects of the COVID-19 pandemic.

Effective immediately, Universal guarantees that its titles, as well as those of its art-house division Focus Features, will have 17 days of theatrical exclusivity at Cineplex locations, after which point Universal has the option of sending its movies directly to premium video-on-demand (PVOD) platforms, including Cineplex’s online store. However, any Universal film that earns more than $50-million (U.S.) on its opening weekend in North America, including such franchise fare as the Jurassic World and Fast and Furious films, must play at least 31 days before heading to PVOD.

“The pandemic has given the industry and movie-lovers around the globe a new appreciation for the magic of the big-screen experience,” Cineplex CEO Ellis Jacob said in a statement. “We are pleased to work alongside like-minded partners such as Universal, a studio that respects the theatrical window and is committed to the sustainable long-term health of the theatrical system.”

Talks of shortening the window, which is traditionally 90 days from the time a movie plays theatres until it is available for the home entertainment market, had become a sticking point between studios and theatre owners long before the pandemic shuttered cinemas across the world and disrupted the entire 2020 release calendar.

Given that most Hollywood films typically earn 75 per cent to 80 per cent of their box-office revenue within the first three weeks of release, studios felt that a three-month delay until they could see returns from ancillary markets was unreasonable.

“It seems folly to think that you should have to wait another four to six weeks, and sometimes longer, to go to the next window,” Chris Aronson, president of domestic theatrical distribution for Paramount Pictures, told The Globe and Mail in late October. “Exhibitors know darn well the more money we as a content distributor make, the more movies we’re going to make, which is better for the theatrical ecosystem.”

Theatre owners, however, long argued that making titles available too quickly after their theatrical release gave audiences too little incentive to leave their homes, and risked cannibalizing their business.

“During the pandemic, things are different,” Mr. Jacob told The Globe earlier this fall. “It’s not to say that we accept what they’re doing as being the best for the long term. But in the short term, sometimes you have to make some changes that work in favour of both sides. Everybody is basically trying to bring the movie business back.”

The Cineplex arrangement comes on the heels of similar 17-day deals signed between Universal and U.S. exhibition giants AMC and Cinemark. As a result, the few Hollywood movies that have opened in North American theatres this pandemic-afflicted fall have come from Universal (Freaky, The Croods: A New Age) and Focus (Come Play, Let Him Go).

However, other major studios are approaching the window differently. This week, Warner Bros. announced that its anticipated sequel Wonder Woman 1984 would open in theatres Dec. 25, but would not be available for streaming in Canada until the end of the “standard theatrical window.”

“With audience fragmentation accelerating due to the rise in digital, streaming and cord cutting, as well as the unprecedented issues our industry is facing right now, our relationship with exhibition had to evolve and adapt,” Donna Langley, chairman of Universal Filmed Entertainment Group, said in a statement. “Giving consumers the flexibility to view content on their terms is more important than ever to help expand moviegoing, and Ellis and our partners at Cineplex allow us to increase these opportunities for our Canadian audience.”

When AMC’s deal with Universal was announced in July, it was reported that the theatre chain would receive an unspecified share of the PVOD revenue. The full terms of the Cineplex/Universal arrangement are not being disclosed.

Restrictions on public gatherings owing to the global pandemic have continued to inflict pain on the entire movie theatre industry, including Canada’s largest exhibitor. Cineplex reported last week that its third-quarter revenue fell more than 85 per cent, to $61-million. In those three months ended Sept. 30, just 1.6 million visitors came to its theatres, compared with 17.5 million in the same period last year. Executives say they are encouraged by positive news about vaccine trials to tackle COVID-19, which provide hope that business can begin to ramp up again some time next year.

With files from Susan Krashinsky Robertson

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