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Competition Commission Plan B: The Manifesto For Quality Cinema

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It has now been almost four weeks since the Competition Commission published its findings into the Cineworld / Picturehouse merger and determined that Cineworld must sell a cinema in each area. They immediately decided to sell Picturehouses in Aberdeen and Bury St. Edmunds and are still deciding whether to sell the Cineworld or the Picturehouse in Cambridge. Cineworld have now actively been seeking purchasers for the various cinemas and we appear to be approaching a final decision in the next couple of weeks.

However, in the process of reaching their final decision, the reports attempted to define how the cinema market is broken down. It’s at the core of every argument that has followed about how Cineworld and Picturehouse cinemas are – or aren’t – different. The definition in the Commission’s final report broke the market down into just two types, multiplex and non-multiplex cinemas, simply by the number of screens. They had the following submissions from other cinema chains in paragraph 4.17 about non-multiplex cinemas:

Some of these cinemas show exclusively specialized films (and are typically referred to as ‘art-house’ cinemas), but the majority show a mix of mainstream and specialized films. Vue told us that in its opinion there were only a very small number of cinemas that played only specialized films, for example the Cornerhouse in Manchester, the Watershed in Bristol and the Showroom Cinemain Sheffield. Odeon said that there was no longer a differentiation in the eyes of the industry between ‘Hollywood films’ and ‘art-house’ films and that the distinction between different types of cinemas had been eroded by more complex fragmentation, with cinema exhibitors trying to meet commercial targets by programming the most successful films for each cinema on a week-by-week basis. A number of parties told us that they expected to see more overlap in future between film programming in multiplex and non-multiplex cinemas as digitization allowed all cinemas to be more flexible in their film programming.

Sorry Vue, but the independent cinemas you list all do what the Picturehouses do, and show films with an appeal across a wider demographic (the Alan Partridge and Richard Curtis type films) and supplement them with a diet of more specialist films. Odeon, you need to consider why there are films you show in the majority of your cinemas and those you don’t, particularly when considering what you show in your London venues such as Covent Garden and Panton St and what you show outside London. If you can’t see the difference, customers clearly can.

If you want a simple definition of films that illustrate the divide, then start with world cinema. I’ve seen films from over twenty countries in the Picturehouses and independents that I’ve visited in the last year alone and they are a staple of these kind of cinemas. You can normally spot when a subtitled film is playing in a multiplex: the cinema will sometimes have to put a sign up near the ticket kiosk warning people that the film is subtitled to attempt to reduce complaints, and the trailer for the film will feature little or no dialogue, so as not to give the game away. You could also add most low budget British film to this divide; I saw Clio Barnard’s outstanding British film The Selfish Giant last week at the Cambridge Arts Picturehouse, but I challenge anyone to find any multiplex outside London that’s shown it. Add in the screenings last week of classics such as An American Werewolf In London in Bury last Friday and E.T. in 70 mm, both of which were strongly attended and which are the rule at these cinemas and the exception elsewhere, and the quality of film needing to be protected becomes clear.

The report also made note of various cinema chains, including Showcase, Vue, Cineworld and Odeon who are offering whole cinemas or screens in existing outlets based on a premium cinema offering. These have larger and fewer seats and will bring food into screens for you. They charge at least 60% more, and show exactly the same kinds of films being shown in ordinary multiplexes, as confirmed in the report by Cineworld and obvious to anyone who looks at their cinema listings. This is fundamentally not the same as the current Picturehouse offering, and if any cinema owner attempted to convert a Picturehouse to this model, the increase in price would be several orders of magnitude higher than anything that the Commission originally envisaged Cineworld imposing and would lose at a stroke the quality of the current film offering.

It’s clear we need a better definition of types of cinema, if nothing else to stop us getting into this kind of mess in future. But more critically, with the sales of either two or three Picturehouses imminent, there is a clear demand from customers as to what they want from these kinds of cinemas, but the cinema industry itself has singularly failed in its attempts to describe this, and if we don’t make this clear to both the Competition Commission and the potential purchasers, we run the risk of these cinemas being run incorrectly, denying customers what they demand and putting their futures at risk. So it’s now down to us, the customers, to try to make it clear to the cinemas and the Commission how we see this breaking down.

So here’s my definition of a quality cinema, which I believe is a better representation of what the Picturehouse and other independents offer.

Manifesto Of Quality Cinema

A quality cinema is defined to be a cinema that has:

  1. a requirement to show at least 50% of film or event titles per week on average over a given period that are not shown at the multiplexes, although this may be a single screening for a given title
  2. in addition to this, a requirement to show an average of one title a week with at least one screening per day that is not showing at the multiplexes on a regular basis
  3. a requirement to offer off-peak screenings for over 60s for at least one day per week, screenings for parents with young children at least once a week, regular screenings and events for young children and students and provision for autism friendly screenings
  4. a commitment to offer access to festivals, including any currently operating festivals at any of the cinemas*, and to allow their operation on a like-for-like basis to current events
  5. a commitment to maintain any currently operating single screenings**, and to allow their operation on a like-for-like basis to current events
  6. a commitment to maintain an alcohol licence and the provision of hot and cold food not currently served at multiplexes***
  7. a commitment to maintain streaming of live and pre-recorded theatre and other cultural events other than films on a like-for-like basis with the current operation
  8. that they be allowed reasonable access to events distributed by the Picturehouse distribution arm in the manner of other similar cinema operators not owned by Cineworld
  9. a commitment to preserve any non-digital projection methods currently in use and to maintain any other support necessary to use these facilities
  10. to allow access to film clubs and other societies to host screenings or events such as film quizzes on a reasonable basis

* events such as the Cambridge Film Festival or other festivals where a series of films run under a specific theme
** events such as film clubs, or the regular Staff Pick events at the Abbeygate Picturehouse
*** the Competition Commission do not currently require any new purchaser to maintain the cafe at the Abbeygate in Bury St. Edmunds, which I believe has been an integral part of its current success

The Picturehouses would all currently meet this requirement, and I believe that any supplier, whether a chain or independent, taking these over should be required to agree to meet this set of criteria in principle.

The Competition Commission previously dismissed the option of applying behavioural controls, so this is intended to be something simpler and that wouldn’t require formal monitoring on an ongoing basis. It’s effectively an informal contract between us, the customers and any new operator, and indicates what we believe makes this a cinema we’d want to attend. The independent cinemas listed in the report and mentioned above would also fit into this definition or something very close to it. I still believe that the best option for price and choice for customers, and for their long term sustainability, is for them to remain in Cineworld and Picturehouse ownership, but if this cannot be achieved then I see this as the next best alternative.

The immediate action before any sale is agreed is that I believe the Commission should apply the above criteria as a test to any prospective purchasers. They have repeatedly and publicly acknowledged that there are differences between the Picturehouse and the other operators, and I believe they have a moral obligation to ensure that these differences are maintained while what they perceive to be the competition requirements are restored.

To be clear: the whole objection of the Commission and the Office Of Fair Trading is that the merger allowed Cineworld to profit at the expense of customers. If Cineworld is allowed to sell to the highest bidder without any form of quality control, they will have profited at the expense of customers. The only people who now have any direct power to influence Cineworld over who purchases their cinemas are the Competition Commission.

I have the support in principle of my own MP in seeking such assurances, and will be seeking other support to this view as well. I am prepared to organise a second petition if necessary to support this view. I will be contacting the Commission today with this proposal and I am keen to ensure it reflects public opinion as clearly as possible. At present the only written commitment from the Commission is to ensure that these are run as a cinema by the new owner. The fear is, as it has always been, that if someone attempts to run these cinemas without these kind of offerings that the customers will be poorly served and the cinemas will struggle to remain open, putting their futures in jeopardy. If you feel that anything needs adding to or changing in this manifesto, please let me know.

If you believe that the Commission needs to follow this or similar guidelines when reviewing any potential purchasers of these Picturehouse cinemas, then you can make your feelings known to the Commission either by contacting them directly at CineworldCityScreen@cc.gsi.gov.uk or by contacting the deputy chairman Alisdair Smith who chaired this panel at Alasdair.Smith@cc.gsi.gov.uk.

Competition Commission Plan A: The Legal Challenge

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It has now been almost four weeks since the Competition Commission published its findings into the Cineworld / Picturehouse merger and determined that Cineworld must sell a cinema in each area. They immediately decided to sell Picturehouses in Aberdeen and Bury St. Edmunds and are still deciding whether to sell the Cineworld or the Picturehouse in Cambridge. Cineworld have now actively been seeking purchasers for the various cinemas and we appear to be approaching a final decision in the next couple of weeks.

There remains an option to challenge the Competition Commission’s decision, through the appeals body known as the Competition Appeal Tribunal (CAT). Anyone with a grievance against such a decision may formally apply to the CAT to review a decision such as the one the Commission have reached. However, this is now entering a legal framework and as such the only way to overturn the decision is to find, in the words of the CAT, “that the disputed decision was based on an error in fact or was wrong in law.”

I still believe there are a number of misjudgements in the findings, ranging from the actual judgement of what constitutes the market to the economic arguments on which the final findings are based. However, my belief in that and being able to prove that to an appeals tribunal are two entirely different things, and so those working to protect these cinemas have come up with a plan of how to challenge this finding. Time is running out, and if an appeal is to be lodged then there are only four weeks left in which to do so, maybe less if a sale is agreed soon and would happen quickly. I still believe that the most stable future for these cinemas and their customers is if they remain in their current ownership, and consequently believe legal action to be the best route to securing that future – IF we can attract suitable support, and quickly.

The plan is as follows:

  • A number of us working together to fight this decision believe we have secured the potential services of a London barrister who is an expert in CAT proceedings and who will review the case to determine any possible successful avenues of appeal based on the case and the evidence we’ve collected.
  • This would cost a total of around £600; we have some offers of help with regard to this, but still need more to get it off the ground. In theory, with 14,400 people having signed the petition, finding 120 people to offer £5 each shouldn’t be hard, as it’s still less than 1% of people that signed.
  • This would then form the basis for a formal appeal, and we are then looking for further legal help to realise that case. However, the review should provide a stronger basis and make securing such support easier.
  • In the event that the legal review doesn’t find enough of a strong case to answer, we would reluctantly focus our efforts on other options (namely Plan B).
  • We will need to confirm funding in the next couple of days if we are to make any progress with this plan.
  • You should be aware that we have contacted Cineworld to attempt to understand why they are not pursuing an appeal, but have so far had no response.

I am aware that various parties, including some of the MPs we contacted, are still contacting the Competition Commission to try to get them to overturn their decision. Even if we had convinced the Commission that their argument was wrong, they have no powers to set aside their own findings once they are published, and despite Vince Cable stating in the House Of Commons that he was a former customer of the Cambridge Arts Picturehouse and generally sympathised with the view, he has no powers to overturn the decision either. The only way currently to stop the actions required by the Commission is an appeal to the CAT.

If you feel you would be able to make any contribution, no matter how small, to the appeal itself in the form of legal support or to the review in terms of financial support please e-mail me at movieevangelist@btinternet.com. A decision will be made in the next couple of days if there is enough support for this plan for it to move forward. If there is sufficient backing for this plan, I will then advise supporters of a transparent and secure method for making any contributions and keep people updated.