Box-office experts say 'Tenet' should move to digital rental ASAP as some major theater chains close again

• Warner Bros. has said that it would play the long game with "Tenet" at the domestic box office, but that strategy only works if theaters are open.
• The major chains Cineworld and Regal are set to shut down all locations in the US and UK this week. The Exhibitor Relations senior media analyst, Jeff Bock, thinks that AMC Theatres, the largest chain the world, could soon follow.
• Bock and Paul Dergarabedian, the Comscore senior media analyst, both said that it's time for Warner Bros. to release "Tenet" to digital services in the US, or even HBO Max.
• "With the number of theaters in operation dwindling by the week, this has to be a no-brainer," Bock said.
• Warner Bros. was in talks with exhibitors to strike a deal similar to Universal and AMC's, which would shorten the theatrical window, a person with knowledge of the discussions told Business Insider last month.

Christopher Nolan's "Tenet" has had a slow run in US theaters. Warner Bros., the studio behind the sci-fi thriller, has said that it's playing the long game as the movie shows in cinemas with little competition due to the coronavirus pandemic.

But that strategy only works if people are comfortable attending indoor theaters and if theaters are even open.

"Hollywood has never been a marathon, it's always been a sprint," said Jeff Bock, the Exhibitor Relations senior media analyst, noting a few exceptions like "Titanic" and "The Greatest Showman." "You can't just make that happen, even if there's no competition. And that's a big part of why the industry isn't dropping blockbusters right now, even in an empty marketplace."

Cineworld Group, which owns the Cineworld and Regal theater chains, said over the weekend that it would close all of its US and UK locations starting this week, dealing yet another major blow to the theater industry.

Theaters across the US reopened in August for the first time since March in regions where local governments allowed, but have struggled to attract significant audiences. Making matters worse, major movies that were to be released in the coming months, from Marvel's "Black Widow" to the James Bond movie "No Time to Die," moved to next year.

There's no word on what the closures mean for AMC Theatres, the world's largest theater chain, but Bock thinks that the dominoes will eventually fall.

"AMC is likely going to try and leverage this as the biggest chain in the US," Bock said. "However, that may only be a short-term solution. Without major product, the major chains are like cruise ships lost in the Bermuda triangle."

So what does that mean for "Tenet"?

The movie, which cost $200 million to produce, has made $307 million globally and $45 million in North America, suggesting it's playing better internationally than domestically. Paul Dergarabedian, the Comscore senior media analyst, said that Warner Bros. has proved its commitment to cinemas and it may be time to seek an alternative such as premium video-on-demand in the US.

"What WB did was show complete solidarity with the movie industry and that was important," Dergarabedian said. "I can't speak for Warner Bros., but I imagine they are looking at the marketplace [for digital release]. At this point, WB has more than accomplished what it needed to do. It's been five weeks. That's shorter than a traditional window but this isn't a traditional time."

It wouldn't be unusual for Warner Bros. to embrace PVOD, even if it committed to theaters with "Tenet." In the wake of Universal and AMC agreeing to shorten the traditional theatrical window for Universal releases, Warner Bros. was also in talks with exhibitors to strike its own deal, a person with knowledge of the talks told Business Insider last month. The Universal and AMC deal allows Universal to release its movies to digital-rental services after just 17 days in theaters.

Warner Bros. did no respond to a request for comment.

Bock agreed that Warner Bros. should fast track "Tenet" to PVOD in North America, or even use it to boost WarnerMedia's flagship streaming service, HBO Max.

"With the number of theaters in operation dwindling by the week, this has to be a no-brainer," Bock said.

If the movie does move to digital in the US, it would likely still play internationally until it stalls out. It is set for release in Bolivia, Costa Rica, and Nicaragua this week, with more markets to follow.

"For a movie to earn $300 million during a global pandemic, that's not an insignificant amount," Dergarabedian said. "Hindsight is 20/20. While the North American gross isn't what you'd expect for a Nolan movie, it's to me still a win for the industry as a whole."