Sean Parker's Screening Room lands big names but draws industry skepticism

Sean Parker, the man best known for turning the music industry upside down with Napster, is back at it again, sending tremors through Hollywood with a potentially game-changing viewing platform called The Screening Room. The entrepreneur and his partners want to allow consumers to watch films in the comfort of their living rooms the same day they are released in theaters. According to Variety, Screening Room would require consumers to pay $150 for a proprietary set-top box and then charge an additional $50 per film, which they would have 48 hours to watch.

Parker, who declined to comment for this article, is yet another player trying to collapse the highly-guarded window between theatrical and home video releases — somewhat sacred terrain that theater owners and movie studios have been preserving for decades under the belief that it’s the only way to keep the theatrical movie-going experience a viable economic proposition.

According to Deadline Hollywood, filmmakers as influential as Steven Spielberg, J.J. Abrams, Ron Howard, and Martin Scorsese, among others are said to be endorsing Screening Room’s efforts. On Sunday, Peter Jackson explained his support, saying in a statement first published at Variety that “Screening Room will expand the audience for a movie – not shift it from cinema to living room. It does not play off studio against theater owner. Instead it respects both, and is structured to support the long term health of both exhibitors and distributors – resulting in greater sustainability for the wider film industry itself.”

Yet the forces within the distribution and exhibition business seem to much more cautious about a new business model that has the potential to upend the theatergoing experience. In order to incentivize the exhibitors into joining forces with him, Parker proposes cutting the theater owners into the fee charged to consumers — possibly $20 of every $50 rental — in addition to offering those consumers two free movie tickets to see the same film in theaters. AMC Theaters, according to Variety, has expressed interest but the chain declined to comment. Other exhibitors are balking at this idea, indicating that the cut into the $50 ticket price still doesn’t get moviegoers to buy concessions. They also recognize that with the exception of films like Star Wars, most moviegoers won’t return to the theater to see a film they have already watched at home.

“It’s different, but I wouldn’t call it appealing,” said one exhibition source.

Cinemark, North America’s third largest chain of theaters, is also wary about the effort. “The exhibition window has been the most stable window long-term and the theatrical success of a film drives the value proposition for the studios’ downstream ancillary markets,” stated Mark Zoradi, Cinemark’s chief executive officer. “Cinemark believes that any day-and-date propositions must be critically evaluated to avoid the devaluation of the exhibition window and all subsequent revenue streams of our content providers.”

The only way for Parker’s effort to work would be to get all the studios on board and force the exhibitors’ hand. Yet according to sources familiar with his efforts, Parker has only met with each of the studios once and none are ready to sign on despite Variety‘s story indicating that Fox, Sony and Universal have shown “serious interest.”

Another concern from the studio side of the equation is piracy. Though Parker claims to have anti-piracy technology that would prevent hackers from accessing the content, the idea of releasing a pristine copy of a blockbuster into the homes of tech-savvy fans sends terror into the hearts of studio execs constantly working to stay one step ahead of profit-killing pirates.

Parker, who has signed up veteran distribution executive Jeff Blake to help with his effort, has been pounding the pavement since last fall, but has yet to sign any studio deals. Whether or not his effort becomes more enticing to the players involved remains to be seen, but skeptical Hollywood players need only look at the music industry to see the pain of change. (Global music revenues are at about 53 percent of what they were in 1999, when Napster launched.) At this point, it doesn’t look like Captain America: Civil War will be coming to your big-screen TV anywhere near its May 6 theatrical release. Get ready to drive to the theater.