Warner Just Destroyed AMC Entertainment

By Douglas A. McIntyre Published Dec 4, 7:34AM EST

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Warner Just Destroyed AMC Entertainment — © jganser / E+ via Getty Images

AT&T’s Warner Bros. just dug the grave for troubled movie theater company AMC Entertainment Holdings Inc. (NYSE: AMC). Warner has decided to release its 2021 slate of films on its HBO Max streaming service at the same time they go into traditional theaters. The trend has been coming for a long time.

Studios have watched the likes of Netflix and the Amazon Prime streaming service bypass theaters while making hundreds of millions of dollars in the process. The two organizations became studios themselves, creating thousands of hours in original programming to draw subscribers. Recently, Apple launched a similar model with Apple TV+. Warner and its fellow traditional studios were stuck, until now, in a distribution model that is a century old.

AMC already was teetering on the brink of extinction. The pandemic has forced it to close theaters. Efforts to make them safer have not brought back customers. Also, due to social distancing, the theaters could only be partially full.

Warner made a comment about its plan that is almost certainly not true. Ann Sarnoff, board chair and CEO of WarnerMedia Studios and Networks Group, said, “We’re living in unprecedented times which call for creative solutions, including this new initiative for the Warner Bros. Pictures Group. No one wants films back on the big screen more than we do.” Due to its actions, the big screen is going away.
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Surely other large traditional studios will follow. The largest of them, the studio division of Walt Disney, has held the market share lead in revenue from theaters for most of the past decade. Its Disney+ streaming business, barely a year old, has over 70 million subscribers. It will make a move like the one Warner has and rob traditional theaters of their final lifeline.

AMC is done. The last one to leave should turn out the lights.
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About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.