Theater operator Cinemark Holdings (CNK +2.50%) is apparently protesting Walt Disney's (DIS +2.18%) decision to release its animated Raya and the Last Dragon movie to both cinemas and its Disney+ streaming channel, refusing to show the film in any of its 345 theaters during its opening weekend.
The movie grossed only $8.6 million in the U.S. and Canada, a feeble opening for the first big film of 2021, and the first that Disney has released since the COVID-19 pandemic began in the United States last March.
Image source: Walt Disney.
The finances of theater operators are stretched because studios have pushed back the release dates of their big budget films, which the theaters are counting on to survive. The launch of numerous streaming services last year, however, still gave the studios an outlet for their films.
Disney+ launched in November 2019 and became an immediate hit as there were few entertainment venues open during the coronavirus outbreak, which Disney took advantage of to test circumventing theaters. It released the live-action remake of Mulan straight to the service as a $30 pay-per-view offering, even for Disney+ subscribers.
It was not an overwhelming success, but enough of one that Disney CEO Bob Chapek recently said there was no "going back" to the old Hollywood distribution system. Raya and the Last Dragon was also a $30 PPV offering, though the studio did not provide any data on views.
Cinemark is the second largest theater operator in the U.S. behind AMC Entertainment Holdings (AMC +0.00%), which did show the film. Regal theater owner Cineworld Group (CNNW.F +0.00%) remains closed until studios commit to releasing big-budget films to theaters.
While Cinemark didn't comment on its reason for not showing the film, it's clear the industry is not happy with the dual release structure studios are trying to force on them.
