As the showbiz saying goes, “the show must go on,” and theaters are trying to keep up.
In the last several years, theaters faced the COVID-19 pandemic of 2020, the industry strikes of 2022 and 2023 and the rise of streaming, leading to concern that movie theaters had fallen behind in the entertainment industry’s everchanging landscape. USC’s School of Cinematic Arts had a different idea.
Moderated by the SCA Assistant Dean of Programming and Special Events Alessando Ago, the “Exhibition Ecosystem” discussion focused on the adaptive strategies of theater executives and how theaters are embracing original content and curative marketing.
“What has really shown as a form of disruption is actually how resilient theaters are in destruction,” said Jack Heller, founder of Assemble Media, a production and IP creation company. According to the L.A. Times, the summer cinema surge revenue in the U.S. and Canada reached a historical record of $4.76 billion, a nearly 30% jump from 2025.
“Through some of these challenges with the consolidation amongst the studios, we realized we had to step up our game,” said Regal Global Entertainment’s chief financial officer Thomas Song when talking about theaters’ strategies. “It wasn’t good enough to be open and waiting for films to come along. We actually had to increase and enhance our experience for the consumer. What we learned during this time was that a habit was broken.”
With traditional formats like IMAX becoming popular again and films staying longer in theaters, indie films are finding their way into theaters.
“I’m more excited than anything else,” said Elton Holt, a first-year film production MFA student. “I’m more optimistic that what’s happening right now is shaping this industry in a different direction, but for the better of us. I envision more original IPs, more stories being told from people whose stories haven’t already been told, but just more ideas like what we saw this year with ‘Obsession.’”
Recently, original Warner Bros. and Paramount blockbusters, such as “Supergirl” and “Practical Magic 2,” underperformed at the box office. However, low-budget and original IPs such as “Obsession” and “Backrooms” generated over $300 million combined; “Obsession” generated $225 million and “Backrooms” earned $135 million. Those numbers suggest that audiences are craving something new. Last year, Regal Cinema created the program Month of Masterpieces, a series of films curated by their film department that included acclaimed filmmakers. This year, the series featured selections from Chloé Zhao, Rian Johnson, Gina Prince-Bythewood and Edgar Wright.
Forms of alternative content and usage of novelty merchandise such as popcorn buckets have become a growing way for theaters to increase revenue. Concessions have always been a way for theaters to generate revenue and making them more personalized to a particular film generates greater interest in the film itself. Alternative content, which would include Beyoncé’s Renaissance concert or the featuring of indie movies, has also helped increase theater economics.
“With the increase of indie projects that are garnering a lot of attention, it’s putting a mirror up to the industry,” said USC MFA screenwriting student Davon Cecil. “It’s starting to pivot back to the creator and us being the ones who make the decisions ultimately.”
However, others have suggested that this creator-economy isn’t so true.
Last week marked the settlement of the Paramount Skydance and Warner Bros. merger. The conglomerate reached a $110-million agreement to proceed with the merger, a practice familiar to Hollywood’s roots.
“This is how the studio system was founded in the 1920s,” said Luci Marzola, assistant chair of the Cinema & Media Studies of the USC School of Cinematic Arts. “The difference right now is that we already have a few powerful companies and it’s just getting fewer and fewer.”
This comes after the longstanding attempts to prevent a merger. However, due to a sudden 180 on their stance on the settlement, David Ellison, California’s Attorney General Rob Bonta and other attorney generals came to an agreement that would centralize film, television and news production.
The settlement includes the protection of theaters, calling for the release of at least 30 films next year and at least 32 films in the years following up until 2031.
On the panel, experts said only time would tell whether the merger would be good for the entertainment industry.
“I want as many movies in the theater as you can put in there but fully marketed to get behind and support. So, I’m less concerned about the aggregate number,” said Cinema United’s President and Chief Executive Officer Michael O’Learly in reference to the settlement. “If you have 30 movies but you, and I’m not suggesting this is what they’re going to do, only market 20 of them, that doesn’t help anybody. The standard I will use to judge the success or failure of [the films released] is: what is the number, and were they fully supported?”
The settlement was not fully addressed until the last few minutes of the panel.
Edited by Ally Nakamura, Lindsay Augustine and Eileen Yang