Paramount Decree found dead as Sony buys Alamo Drafthouse
We knew AMC releasing The Eras Tour was a disaster in the making
Aux News Alamo
Photo: AaronP/Bauer-Griffin/GC Images
Once considered a monopolistic business practice that prevented healthy competition in movie distribution and exhibition, movie studios are again buying movie theaters. Thanks to a 2020 decision that welcomed the idea of studios being in charge of production, distribution, and exhibition, Sony has purchased Alamo Drafthouse, Variety reports. It’s not a moment too soon for Alamo’s previous warm and inviting owners, Altamont Capital Partners and Fortress Investment Group, which sold the theater chain after months of union-busting efforts against its beleaguered staff. The dine-in theater chain, which popularized noisy screenings thanks to its patented meal service, will be run by the newly established Sony Pictures Experiences, a subsidiary we assume will only grow whenever they make another Ghostbusters sequel.
Alamo Drafthouse has been in dire straits since being purchased by private equity firm Altamont Capital. As its workforce attempted to organize over low pay, inconsistent schedules, workers’ compensation for on-the-job injury (all that crouching and serving is no joke on backs, knees, and shoulders), and understaffed locations, the company set about busting organizing efforts and refused to recognize the union. Even when movie theaters were making money amid the Barbenheimer explosion, Altamont, like many predatory equity firms, refused to improve their business and treat their workers with respect. Now we seem to know why: they were looking to sell the chain off.
Until 2020, movie studios owning theaters was a thing of the past; after all, it would mean studios controlling production, distribution, and exhibition. The 1948 Paramount Decree barred studios from owning theaters for just that reason. In the Reagan ‘80s, when regulations like this began to relax, Loews movie theaters were owned by an array of operators with conflicts of interest, including Coca-Cola, Tri-Star Pictures, and, yup, Sony. AMC and Cineplex eventually purchased the chain in the 2000s. In 2020, a federal judge formally killed the ruling because it was determined that antitrust laws are strong enough to prevent bad behavior. Anyway, three years later, AMC exclusively distributed and exhibited Taylor Swift: The Eras Tour to the tune of $180 million domestically, simply because Swift’s father, former stock broker Scott Swift, worked out a deal with AMC CEO Adam Aron personally.
Swift explained how her father broke this antitrust dam with a simple phone call. “My dad just said, ‘Why does there have to be a—for lack of a better word—middleman?’ My dad, he will call people. He’s been doing this since I was born,” Swift said, per TIME. “My dad is the friendliest man in the world. He’ll meet someone in an airport lounge in 1972 and still talk to him every week now.”AMC netted 43% of the profits from the film, which was quite a bit of cheddar for the theater chain.
The good news is that when Kraven The Hunter finally arrives in theaters, Sony can make sure it plays on more screens than their competitors’ movies because they own the screen. It’s a whole new world of monopolistic possibilities brought to us by, who else, Taylor Swift’s dad. Just kidding. We can thank the Trump Justice Department for its masterful deregulating abilities.
57 Comments
It’s a bit difficult to see how Sony Pictures fits with a theater chain known for screening some really “out there” movies. Although if they’re hiring Neil Breen to make the next Spider-Man movie, I might go see it.
I’ve been going to see cool, out there shit at the Drafthouse since I was 12, driving an hour and a half to Austin with my dad to see Spirited Away and the Buffy Hush/Once More with Feeling double-feature.
This news is genuinely devastating.
They’re just renovate and rebrand to make it whatever they want it to be.
I bet they keep the name, there’s a lot of brand equity in it.
They should rename it A.
And then spin off the streaming service A+.
Sony’s Japanese. It’ll be S+.
It’s odd how so many people are framing this like the Alamo brand or experience is going to change drastically. It’s just going to gradually get more expensive, you silly geese.
And worse.
yeah also…it will continue to exist. sony is also in the business of having good PR and know how bad it will look if they just come in and fuck it over. this sounds like a shot in the arm to me.
Alamo Drafthouse has been in dire straits since being purchased by private equity firm Altamont Capital.Has any business ever been a success after being purchased by a private equity firm? It seems like every story of a once-successful business chain that’s filing for bankruptcy has a “then they were purchased by a private equity firm and screwed over” chapter near the end of the story.
I work in finance, and our firm sells companies to PE groups all the time. A PE-backed company is actually less likely to go under than a privately-owned one, because if it’s struggling then the investors can put more money in to support it (and have more resources for troubleshooting). Granted some of these groups are not very good at what they do, the most frequent issue being using too much initial debt when they buy the company. And of course the failures make for more interesting stories than the successes.
Alamo Drafthouse was already circling the drain when they were bought, IIRC.
The thing is, a company only gets sold to a PE firm if it’s already fucked up. So you’re kinda looking a sample set that’s already headed for failure.And yeah there are several examples of companies that restructured succesfully after a PE purchase. Its just that “X business still afloat” isn’t really something that makes the news so unless you’re in Business or Law school you won’t hear about the successes. Did you know that Hilton Hotels was saved by a Private Equity leverage buyout?
I seem to remember a cool little network of blogs that was struggling for years to find a devoted userbase and dozens of talented writers until a kindly old group of billionaires stepped in to help them out. And that little network of blogs, whom nobody liked, grew up to be… sold off piece by piece until maybe one readable site remained amongst the tatters.
nice
Don’t forget employing AI to write story about hating AI
And now you know the rest of the story.
It depends what you mean by “a success.” If you mean “make a short-term windfall for the owners,” then pretty much all of them do. If you mean “continue to provide goods and services to consumers,” then what are you some kind of commie?
The company I work for has been getting bought & sold by PE firms every 3-5 years for the last ~30 years. They varied from totally hands off, letting the execs operate however they preferred, to getting ridiculously hands on, causing employees to leave from stupid changes. Some had good changes or provided the money needed to grow parts without taking on debt. It is quite common amongst small to mid-sized businesses to constantly trade PE firms as they grow and how it works out is the same as anything else, some companies are better at it than others. The big stories that come out usually involve vulture capitalists. Those VCs make their money through buying stressed companies that had either been stagnant for years or actively failing (Sears, K-mart, Toys R Us, & Red Lobster weren’t exactly the hottest businesses around before the VCs killed them), but do so with the intent of stripping the company for parts and collecting as much money as they can along the way.
NYC moviegoers still have Nighthawk.
There’s also still the IFC theater and Film Forum. And Angelika too I think. (In terms of independent theaters that’ll show weird shit, not necessarily sit-down-and-eat theaters)
In the Dallas area we just lost all Alamos due to a franchisee company going suddenly bankrupt, and talking about that with locals was when I learned one of our two Angelikas had gone belly-up. (The other shows so much mainstream fare now, it’s not really the same anymore.) So, this region has nigh little in the way of “specialty” theaters anymore.
I’ve only been once, but it was a great experience.
If you are in the Chicago burbs you have Hollwood Blvd in Woodridge and Hollywood Palms in Naperville. Hollywood Blvd is almost as old as Alamo and probably “borrowed” the whole bar, dinner and movie deal from them but I also liked the place. Prices for everything was always reasonable, food was good and they always made the effort to make sure the movies looked good on screen. And they were smart enough to put an intermission in during long movies, to let people piss and order more drinks without interrupting the movie.
I wish HB wasn’t 40 minutes away from me. I can walk down the street to the AMC Dine-In but the fucking tickets are $22 at a minimum.
It’s SO much better than the Drafthouse anyway….I haven’t been in a while but now I have an excuse to go.
I’m not really worried about Sony buying Alamo from an anti-trust point of view. They only have 36 theaters so it’s not Sony can wield their might and not show their movies elsewhere or only show Sony movies at their theater. If Disney bought AMC, that would be a bigger anti-trust problem since AMC is a much bigger chain.
This is fantastic news for a Sony not-Spidey universe Turner D. Century motion picture. If they make nickle ticket prices it could be the greatest loss-leader promotion of this century!
They could even advertise it as a Turner D. Century movie experience, though that would really mean the most recent turn of the century. Which would be fine with me, 1999 is a contender for best year for movies, period.
Aside from having some cool revivals and arthouse pictures, the Alamo Drafthouse experience was not my scene. During the movie watching hunched over wait staff running around like they’re Alan Alda in MASH under a helicopter blade, delivering food and drinks to people really took me out of the experience.
The dine-in theater chain, which popularized noisy screenings thanks to its patented meal service…
I’m not defending their union-busting at all, but have you been to an Alamo…? If you’re noisy you get one warning, and on the second you’re ejected without a refund. They literally announce it before every screening.
Yploure asking a writer on AVClub if they actually have any knowledge whatsoever of the thing they are writing about? Of course not, silly! Did you forget which site you were reading?
I had to take a second and make sure I didn’t misread the theater chain they were talking about when I read that. It’s such a throwaway line in the grand scheme of things, but I’m sitting here thinking “Wait, how could someone who knows anything about the Alamo say *that*?”
They’ve probably never been to an Alamo Drafthouse and are basing that perception on an experience at one of the dine-in theaters that have popped up since. Though in my experience, the people that go to those theaters tend to be a lot more mature and quiet.
Deleted.
I live in a small town, so I only get to go to Alamo when I am traveling out of state. There policies on talking and texting in the theater is the prime reason I go to Alamo whenever I have a choice.
Yeah, came here to say this, too. Annoying/distracting at times? Yes. Noisy, not at all.
I never had a distraction at the Alamo due to the meal service. Normally people ordered their stuff before the trailers started. Alamo was the first theater chain I saw that did the sing along/dance along screenings of films that weren’t Rocky Horror.
They’re not talking about the patrons, but rather the servers.
Why do we have an FTC at this point?
What does this mean?“Even when movie theaters were making money amid the Barbenheimer explosion, Altamont, like many predatory equity firms, refused to improve their business and treat their workers with respect.”Businesses should treat their workers fairly. But it’s insane to think that companies are going to change their business practices because of . . . two movies that were very successful, amid a year when movies as a whole were struggling. Barbie made less money than Frozen II. Jurassic World, and the fucking Lion King remake. It’s great that it was successful, but it was about as successful as really successful movies were pre-pandemic. Movie theater chains don’t make their money one day or one week or one month, and that means that a single very successful movie doesn’t change the overall trajectory of what’s happening.
A lot of people struggle with basic financial concepts, so it shouldn’t be surprising when writers struggle to articulate how the financial success of an event like Barbenheimer should trickle down to the workers.And to be clear, I don’t like that companies seem more emboldened than ever to treat their workers like shit. I think it’s a very short-sighted way to run a business, or any organization. It would have been nice if Alamo had paid out bonuses directly to the workers instead of the tone-deaf bullshit, “Thanks for the hard work, champs!” email they got.But expecting predatory equity firms to improve their business and treat their workers with respect is like expecting a bully to be nicer to you after they got an A on the homework you did for them. Their behavior was just positively reinforced. Why would they change now?
OK, but most workers’ pay does not depend in an immediate way on how their workplace is performing. For movie theater workers, that’s generally been a good thing in recent years, because revenue from movies is way down. If workers are supposed to set a pay increase for Barbenheimer, do they get a pay decrease when Fall Guy and Furiosa struggle? Because we’ve seen a lot more disappointing box office weekends than great ones.
Hey, I agree with you.
The last two films I watched in the theater, both at the Alamo Drafthouse, were Avengers: Endgame and Poor Things. With COVID, COVID still being a concern, and me not having much money to spend lately, I just haven’t been inclined to go out, even if I did want to see Barbie, Top Gun Maverick, and whatever worthwhile indies they tended to show.The experience between 2019 and 2024 is kind of stark. The food is more expensive. I ordered their royale with cheese (comes with fries) and a milkshake and it cost me $30, which includes tip, which is around $10 more than it was before. They made a point to say on the menu and other nearby materials that there was a mandatory gratuity charge attached to everything, but it wasn’t 20%, so it was difficult for my medium brain to figure out how much more I needed to tip. I’m not against mandatory gratuities, it should be on Doordash so people are unable to cheap out on people who seriously depend on tips, I just wish it was either 20% or shows me what the base price or whatever is on the receipt.The 30 minute pre-show experience is largely the same. Most people don’t show up to watch all of it, as usual, but someone put a decent effort into showing relevant clips and stuff about Emma Stone and her dancing talent.Their YouTube channel hasn’t been uploading as many interesting things that end up on their screens as they used to, it’s mostly filmmakers and actors doing a promo spot. Nothing like this old gem:Learning about this depressing behind the scenes corporate collapse of what used to feel like a shared experience of our love of cinema, audience and staff, and transforming it into a brand name that will mean less the more they change things. I wouldn’t even go to other theaters, I loved it so much there. They used to offer a free movie ticket for your birthday, but now you get a popcorn or something.I’ll probably head out to see Deadpool when it comes out, but it’s just not going to be the same knowing the employees aren’t being treated as well as they should, the food is going to cost twice its worth, and independent movies worth seeing, as well as special screenings of older films, are going to be reduced if not phased out entirely for the sake of their precious bottom line. If only the people who cared about what they did could always stay in charge.
On moving to the US and living in Brooklyn for a year, Alamo Drafthouse was a brilliant surprise find for me, and I loved going there. It was a major bummer to find out afterwards about the way they treated staff.
guy who goes to the movies twice in 5 years: it’s a shame theatres are so expensive now.
We should start a pool to guess how long it will take for Sony to ruin everything about Alamo that worked, run the chain into the ground, and sell it for parts.
Fortunately, the “parts” here are movie theaters, so there’s no way to flip them unless Sony wants to get into bowling or EDM business.
A development group turned a defunct multiplex in my area into a pickleball facility recently, so you aren’t far off on the options that are out there.
they turned an old porno theatre into a rock climbing gym here.
Is the name of the business “Rock Hard”?
The Paramount Decrees had been living on borrowed time. The decrees bound the big studios of the time and several of those studios are either defunct like UA and RKO or have been gobbled up by bigger companies, as happened to MGM and 20th Century Fox. Disney wasn’t even covered by the decrees. As uncomfortable as it is to see Sony acquiring yet another thing, I think Sony has the sort of portfolio that makes Alamo an interesting fit for the weirder films they’ve got, particularly on the Sony Pictures Classics and Crunchyroll labels. As long as they keep showing other studios’ wide releases and stop standing in the way of their employees organizing, I think Alamo’s future is secure.
Like most big Supreme Court rulings, Paramount was read as extending beyond the specific studios to include movie studios generally – but it was still living on borrowed time. Even in 1948 it was a bit of an odd duck – the original suit was filed during the Depression because studios were exerting unfair leverage on independent movie houses. After World War 2, movie studios were competing with suburbanization and TV, so they were already in a weakened position when the final decision on Paramount came down. The irony is that we’re actually shifting toward the state of affairs that Paramount was supposed to address – studios consolidating movie distribution to strangle competition – but it’s happening through streaming sites rather than theaters.
Speaking from a long time Austin-based customer’s perspective, Alamo was a magical place without peer when we moved here 11 years ago, but since then has been gradually going downhill, accelerated, unfortunately, by COVID and Tim League being forced to sell out to private equity. My expectations are low, but hopefully Sony can make some changes that will restore it to its former glory, or at least something approaching it. That starts, of course, with happy, passionate, and fairly compensated employees.