Lush Palaces Of Film

Once we can download first-run movies at home and play them on wall-size TV screens, who's going to bother going to the movies? Theater owners are asking the same question, and in response some are already turning movie houses into major attractions. At Showcase Cinemas in Randolph, Mass., Red Sox fans tip back beers and watch their team on the big screen, while vendors hustle hot dogs and baseball paraphernalia. In a higher-end spin on the same idea, patrons at Muvico's palatial Parisian 20 theater in West Palm Beach, Florida, leave their cars with the valet and drop off their kids at the supervised playroom before heading upstairs to sip exotic martinis and sample the sushi. Oh, and yes, there's a movie, too.

Driving this trend is the threat of competition. With customer complaints (bad movies, too many ads, etc.) growing and entertainment systems improving, the home-theater market is taking off. The gap between a movie's release and its availability on DVD continues to narrow. As a result, this summer U.S. theater admissions fizzled at $487 million, the lowest total since 1997. "It's going to get increasingly tough getting people outside of their houses," says Paul Dergarabedian, president of Exhibitor Relations, a box-office market-research firm. Trying to disprove predictions of their decline, theater owners say they have big plans for the next decade: better service, plus dinner and drinks, concerts and comedy shows. Going to a movie should be a "social outing," says Muvico CEO Hamid Hashemi. "If we as theater owners don't give you that, you are going to stay at home."

At the vanguard of this makeover is National Amusements, a chain of 86 American theaters run by Shari Redstone, the likely successor of Viacom. On weekends at The Bridge: Cinema de Lux in Los Angeles, ushers lead VIP patrons to reclining leather seats, while a comedy troupe warms up the audience. Redstone also owns the Showcase, one of nine theaters in Massachusetts, Connecticut and Rhode Island where her company is showing 22 Red Sox games this season. "We... turn the auditorium into Fenway Park," she says. "People get up and do the wave." Redstone's theaters also offer other forms of entertainment: last month the Showcase featured two celebrity impersonators from Las Vegas.

Theaters are also trying to turn technology to their advantage. John Fithian, president of the National Association of Theatre Owners, says the industry is "on the cusp of the biggest technological transition" in its history. As digital technology replaces 35mm film, theaters will be able to show independent films and sporting events at a lower cost, or to offer 3-D movies or videogames. Kit McKittrick, the CEO of HoloDek, an interactive-gaming company based in New Hampshire, envisions people coming to theaters on weekdays to play videogames from their seats on two-meter screens.

There are other off-hours ideas, too. Some theaters such as Loews now offer afternoons for moms and babies. Gerry Kaufold, an analyst for In-Stat market research, says some companies are considering theaters for meetings, so the CEO can appear on a giant screen.

For others, less (aggravation) is more. In 2002, Pacific Theatres opened ArcLight Cinemas in Hollywood with all-reserved seating. Trailers are kept to a minimum, and ads have been eliminated--on screen and off. Ushers make sure that patrons avoid excessive chatter. And popcorn comes in bins, not loud, crinkly paper bags. Tickets cost $14, about $8 more than the national average, but Pacific Theatres CEO Chris Forman says customers think it's worth it. His proof: despite the box-office slump, attendance is up 25 percent from last year.