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For new releases in Canada, it's still the big screen or nothing

Detail from the movie poster for "Tomorrow When the War Began"

It's a 30-year-old dream that's finally coming true. Sort of.

When the first Canadian pay-TV channels launched in the early 1980s, plenty of viewers mistakenly believed they were going be able to watch the same movies that were playing down at the local multiplex. They didn't realize that the movie-distribution business operated according to a very rigid set of rules which meant films wouldn't appear on pay-TV for at least a year after hitting theatres.

On Friday, though, movie fans will be able to enjoy the blockbuster Australian film Tomorrow When the War Began at home on the very same day it hits theatres: through iTunes ($4.99 for a high-definition stream), on their cable-TV video-on-demand channel ($6.99 for HD), and on Facebook ($5), followed by a DVD release next Tuesday.

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Sorry, I should clarify: U.S. audiences will have those options. Canadian moviegoers will remain, um, movie-goers: They'll have to actually go to the theatre. (It is currently scheduled for release on this side of the border in May.) And some distributors say that's directly because of the dominance of Cineplex Entertainment, which last year had a 66-per-cent share of the Canadian theatrical exhibition market, and its powerful CEO Ellis Jacob. (Cineplex's closest competitor, Empire Theatres, holds about 13 per cent.)

"What Ellis says, goes here [in Canada]" said Berry Meyerowitz, the president and CEO of the independent Toronto-based distributor Phase 4 Films, which does far more of its business in the United States.

The multiplatform premiere of Tomorrow is the broadest example yet of the shifting power dynamic between the old-guard movie-theatre chains and the exploding number of players in the film-exhibition business. It's a very touchy subject in the United States: Last year, when a handful of big studios shrank the usual 90-day window that theatre circuits have to themselves by releasing some films early on DVD and video-on-demand, the National Association of Theatre Owners blasted back with the force that its military acronym NATO might suggest. Many theatre chains said they would not accept a movie slated for early DVD or VOD release.

In an e-mail on Wednesday, Cineplex reinforced its own position. "Cineplex would not show a movie that would be going to [premium VOD]earlier than the traditional windows," said Pat Marshall, vice-president of communications and investor relations for Cineplex Entertainment.

A growing number of distributors believe that's closed-minded: Bad not just for them, but also for movie audiences. Sports teams, after all, learned long ago that some people are happy to spend big bucks to attend live events, even as others take in the games for free on TV. (And the cost of TV rights have soared.) More distribution channels usually mean more money.

In the United States, the independent distributors IFC and Magnolia have successfully been offering their quirky films for on-demand purchase over cable and satellite TV systems on the same day they premiere in theatres, putting smiles on the faces of all the hipsters who couldn't make it out of their apartments. (Yup, hipsters are new parents too.) Magnolia actually offers something called ultra-VOD, premiering its movies online and on cable about a month before they hit theatres.

But they can afford to take that route because their parent companies also own cable channels and movie theatres, so they don't need to worry about being locked out of other distribution channels. In any case, the U.S. cinema scene is more splintered than it is here, with no single player dominating the way Cineplex does in Canada.

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Another indie player, Lionsgate, specifically cited video-on-demand as a key to the success of the independent Wall Street drama Margin Call, which was released in theatres and on VOD at the same time last fall. "This will be a very profitable movie for us due to the low marketing expenses and multiple day-and-date revenue sources," Lionsgate CEO Jon Feltheimer said in a conference call last November.

A profitable movie, satisfied exhibitors, and hundreds of thousands of happy fans who got to watch a great new film in the comfort of home: It almost sounds like a dream. Which, for Canadian movie audiences, it will remain.

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About the Author
Senior Media Writer

Simon Houpt is the Globe and Mail's senior media writer, charged with covering the industry's transformation. He began his career with The Globe in 1999 as the paper's New York arts correspondent, covering the cultural life of that city through Canadian eyes. More

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