Why the Screening Room, Sean Parker’s Proposed Streaming Service, Is Dividing Hollywood

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If you want to see the biggest new movies, you have to go to the theater. This is the premise the film industry rests on: It expects — no, it knows — that enough of us will want to see a new Star Wars movie, or Batman v Superman, or any other blockbuster release badly enough that you will pay the rising ticket price and maybe buy some popcorn and put yourself in that theater seat.

Of course, there have been innumerable threats to that once-ironclad truth over the last few decades, all treated like they might be the end of movies as we know it: VHS, DVD, streaming. Now we have the latest: a service called the Screening Room that would bring first-run movies, à la the superhero tentpoles and prestige pictures that still get people to go to theaters, into the sanctity and comfort of living rooms everywhere. That is, if Hollywood doesn't bury it first.

Led by Sean Parker, the Napster-Facebook-Spotify impresario portrayed by Justin Timberlake in The Social Network, the Screening Room has so far added a wide swath of industry bigwigs as stakeholders, including Martin Scorsese, J.J. Abrams, Steven Spielberg, Ron Howard, Brian Grazer, and Peter Jackson, who explained his support by saying that it will expand the audience for a movie by catering to individuals who wouldn't otherwise go see it in theaters. And though a $150 set-top box and $50 per 48-hour rental might seem preposterous, if you're splitting that amount between a handful of people, it's still cheaper than movie tickets — plus, no traffic or babysitter required, and you can make popcorn in the microwave, and you don't need to guess at the best time to hit the bathroom because you just drank 32 ounces of Mountain Dew. (You've watched movies at home before. You understand.)

As you might expect, not everyone is keen on the idea of the last frontier — the exhibition viewing window that keeps a movie exclusive to theaters for a certain period of time — toppling in the face of Parker's lust for innovation. Deadline had some choice quotes from distributors and exhibitors:

 "This news is so damaging, I can’t tell you right now how unhappy I am."

 "It would be the beginning of the end, and half of the theaters in this country would close."

 "Hopefully, this will fail."

 "Anyone who thinks this is going to work in this day and age needs their head examined."

Midas-touch filmmaker James Cameron and his longtime producer Jon Landau have also come out against the Screening Room, upholding the sanctity of the theater-going experience as well as making some salient points: Best intentions aside, the service would be incredibly susceptible to piracy, and there's nothing to prevent someone from paying $50 and then piling in as many people as they can fit inside the room.

Unsurprisingly, the National Association of Theater Owners — confusingly referred to as NATO — has also voiced its opposition to the Screening Room, saying it believes any new form of VOD and at-home viewing should come directly from exhibitors and distributors. The Art House Convergence, an alliance of smaller exhibiting interests, did the same, and the only support of any kind the Screening Room has received from inside the distributor/exhibitor nexus is from the Chinese-owned AMC chain.

Hollywood has never taken kindly to outsider innovation, and the Screening Room is a terrific example of Silicon Valley "disruption" that sounds great to a bunch of venture capitalists on Sand Hill Road but makes the subjects of that disruption want to rip their hair out. While the Screening Room could have a legitimate use to people who are interested in getting their friends together and watching movies, it does also have a high barrier of entry financially — $150 for such limited-use hardware is insane — making it a product whose appeal would mainly be to either serious film buffs or those for whom money isn't an issue.

Setting aside the viability of the product itself, the larger hurdle is that the only way for the Screening Room to even exist is if the companies that make, sell, and show films actually sign on. It's the same problem Netflix faced in trying to distribute Beasts of No Nation: It had to four-wall theaters because no exhibitors would play ball. Without those partnerships, the Screening Room won't have access to the movies it needs to justify that $50 price point, which are the biggest, newest, and most in-demand movies, the superhero movies and prestige pictures and animated films — also, as it stands, the movies that have become the hinge upon which the industry's financial model currently swings. Parker and co. can act like they're doing Hollywood a favor, protecting them from pirates and saving their business, but they're about to learn how precarious it can be to have to depend on the very people they're trying to disrupt.