When news broke last week of Sony’s plans to buy the dine-in cinema chain Alamo Drafthouse, it marked the first time in more than 70 years that a major Hollywood studio would step in to own and operate a major exhibition circuit. Texas-based Alamo is the seventh largest U.S. exhibitor, with 35 theatres in across most major metropolitan locations.
In a landmark 1948 decision by the Supreme Court known as the Paramount Consent Decrees, the U.S. Department of Justice prevailed in its anti-trust argument, making it illegal for any of the major Hollywood studios to operate movie theatres. This new regulation had been established to stop studios from exercising unfair control over which movies a theatre would be allowed to play.
In 2020, the U.S. Department of Justice decided to rescind this regulation, phasing it out after a two-year sunset period. This opened the door for studios to step back into the business of showing films in company-owned theatres. While Netflix and Amazon had already taken small steps down this path by acquiring a handful of individual theatres in New York and Los Angeles, Sony’s acquisition of Alamo represents a much more significant move by a major studio.
Many are still trying to decipher Sony’s motivations and how it may impact the exhibition overall. Sony is the only one of the major Hollywood studios that does not operate its standalone streaming platform.
Some exhibitors such as B&B Theatres’ Co-President Brock Bagby see Sony’s acquisition of Alamo as a sign that the studio is “doubling down” on theatrical releasing. Sony is also the owner of the anime studio Crunchyroll, and there will be an increased opportunity to showcase those specialty titles in the major metropolitan areas covered by Alamo’s 35 locations.
Whatever Sony’s long-term strategy may be, its acquisition of Alamo will almost certainly result in these theatres operating well into the future. As with many other exhibitors, Alamo has struggled to regain its financial footing in the post-COVID years and Sony’s resources will bring relief from the near-term financial pressures that have caused some other theatres to close up shop.
