Sony to Stop Paying Theaters for 3-D Glasses
Sony Corp.'s movie studio has put theater owners on notice that it will stop paying millions of dollars per film for disposable 3-D glasses starting next May, just before it is to release a couple of summer blockbusters — "The Amazing Spider-Man" and "Men in Black III" — in 3-D.
The move was announced in a letter sent to theater owners, according to a person with the studio. The person was not authorized to speak publicly and requested anonymity.
The abrupt policy change comes as studios are struggling to adapt their business to falling DVD sales, while digital sales have not made up the difference.
Moviegoers, who already pay an additional couple dollars or more for 3-D movie tickets, could be annoyed if they are burdened with a new expense amid high unemployment and a weak economy.
Sony's move was first reported by The Hollywood Reporter earlier Tuesday.
Sony's worldwide president of distribution, Rory Bruer, told the magazine that the studio was trying to give theater owners a long lead time before the move goes into effect.
It is unclear who will pay for the glasses: theater owners, who are financing the billions of dollars necessary to equip theaters with 3-D and digital equipment; advertisers; or even by consumers who might have to buy 3-D glasses and keep them for their next visit.
Spokespeople for major theater chains Regal Entertainment Group and AMC Entertainment Inc. did not immediately respond for a request for comment. John Fithian, president of the National Association of Theatre Owners, also did not respond to a message seeking comment.
At least one rival studio said it is not jumping on the bandwagon.
Warner Bros., a unit of Time Warner Inc., said it was keeping its current system in place for now, although it wouldn't specify what its deals were with theater companies.
"The glasses issues are complicated and they vary from studio to studio," said Warner Bros.' head of domestic distribution, Dan Fellman. "We certainly will do what's right for us. Right now, we really don't have any plans to change the way we do business."
Average ticket prices in the U.S. and Canada rose 6 percent to $7.89 in 2010, according to Hollywood.com, but the price in major cities like New York and Los Angeles can easily double that. Last year, some New York theatergoers saw red when it appeared that several theaters flirted with a $20 ticket price for "Shrek Forever After" in 3-D, before dropping prices.
Overall U.S. box office revenue in 2010 was only kept from falling due to higher prices helped by 3-D upcharges as attendance fell. So far this year, attendance is down nearly 6 percent and revenue is down nearly 4 percent at $7.8 billion.
