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Interview with Harold Blank (Part II )
nthWORD: You have some history in South America--
HB: The people I worked for at Hoyts, based in Australia, had a desire to go worldwide. So we mapped out a strategy and first went to Mexico; I made about fifty trips looking for places to build theaters. I had no idea what I was doing [laughs] I didn't speak the language at the time. Most of the world trailed the US in cinema development. So Mexico, South America, even Europe didn't have a lot of theaters; they were operating these old single, twins, triples, while the US was involved in building megaplexes. So when I went to Mexico I found an industry that was not developed. We eventually got into Mexico because there was a tequila crisis, which was the devaluation of the peso in December of 1994. Everything crumbled. We went in as a partner with a company called Cinemex, which couldn't leave the country because they were Mexican-owned. We bought part of that in 1996 and kept going. Meanwhile in '97 I moved to Buenos Aires to develop a chain of movie theaters for Hoyts. We had nothing, and when I left in 2000 we had 350 screens in four countries, and part of that was through a merger with another company, General Cinema Corporation.
nthWORD: What kind of movies did you play in Argentina? American movies?
HB: We played American movies.
nthWORD: Just American movies?
HB: No. Argentina, Chile, Brazil, they all have their own cinema markets, but not substantial. 80% of movies at the time were US-based movies. Movies are one of the US's largest exports around the world. The business in the US is about $10 billion, that's the gross revenue of ticket sales. Business outside the US for US movies is approximately $17 or 18 billion now. So it's a $28 billion business worldwide.
nthWORD: I'm very interested in Argentina--Buenos Aries--and Chile...
HB: Buenos Aires is great! [laughs] Argentina and Chile are vastly different countries. Argentina has proved to be a problem because of its political systems, whereas Chile has been the reverse because they're stronger politically, and have influenced the international growth of certain industries; it hasn't held back the cinema business in Argentina vs. Chile, but the country in unstable. And devaluation. In any country, when you're building a business, it takes a long time for that business to become based on the currency of the country, because early on your investing in dollars, and that can have a huge impact on your returns. In Mexico we had projected seven years to eventually have built up a strong enough company to be investing in pesos. One way of deferring that is to take on partnerships, so that it's not all US dollars.
nthWORD: So you're bringing American movies to a South American audiences, with subtitles I imagine?
HB: As a matter of fact, it was preferred to do them in subtitles because it was the original inflection of the movie. Some foreign countries required dubbing for youth. If a movie appeals to a four, five, six year old, if they aren't reading, they can go to the cinema.
nthWORD: Did you ever make connections with filmmakers in those countries, films to bring to the States?
HB: It didn't reverse itself. Warner Bros., Columbia, Sony and Fox have branches around the world. I was dealing with a Sony branch down there handling an Argentine film, or independent companies handling a Chilean or Brazilian film. Only India, and China, but India is the best example of a country with their film business rich with Indian, and not just US, films...
nthWORD: Bollywood--
HB: They have a substantial film industry throughout India. And China does too. I don't know what the laws are today for the importation of films into China, but they control the number of US films that go into the market. Four or five years ago it was only ten, but that has increased. Even if it's 20, that's not a lot of US films going in. In essence it's censorship.
nthWORD: With the recent rise in the popularity of foreign films, Babel for instance, which is a multi-language film--
HB: Babel didn't actually do a lot of business in the states; it made $20 million I think. It's actually Jon Kilik, the producer of that movie, attended the University of Vermont.
nthWORD: So he might be on the list [VTIFF Person of the Year Award]--
HB: Jon Kilik could be. He's been up here a number of times. Alexander was his picture, unfortunately for him because it didn't do any business, but we had the world premiere here at the Majestic 10 [Williston, VT] and that was done through the University of Vermont.
nthWORD: So you don't look to get foreign films?
HB: Not at the Majestic, but Burlington is a pretty sophisticated film market, and what happens on the specialty pictures is they're allocated between my theater, the Palace 9 and the Roxy downtown. They'll play one, I'll play the next one. How independent movies or specialty movies, the distribution is changing. IFC, when they buy a picture, they go video on demand first, before the movie theaters. There's a lot going on in the industry with video on demand and where that window should be, and dvd sales are down dramatically, because of the economy itself, but distribution companies are looking for ways to replace lost revenue and are talking of moving up video on demand closer to theater release, for a premium price, like $30. Magnolia, a company that is owned by Landmark Theaters and [what's his name from The Dallas Mavericks], they think movies should be released in homes the same day as theaters.
nthWORD: Really?
HB: There are people who think that.
nthWORD: That's going to take away the whole experience--
HB: It doesn't take it away; you can still go to the movie theater. So, does that happen? I think it does someday. I don't know when. There are purists out in the business who say 'No, never going to happen. I'm not going to release my picture day and date.' Because the theater experience can not be replaced. You see it in a big theater, you see it on a big screen, you see it with people, the interaction, you can never replace that. Peter Jackson, who made King Kong, do you think he make King Kong so it can be seen on a small screen. Even the technology that has improved home theater, it's still not inside a movie theater. It's still different. Look we can eat at home all the time. We still go out to restaurants. I don't think it will ever kill our industry, but I think it can change it a whole lot. That's why the experience inside the theater has to be superb. We have to keep improving it. nth.