AMC Saudi Arabia CEO upbeat about cinema prospects amid-COVID-19

AMC Saudi Arabia CEO upbeat about cinema prospects amid-COVID-19
John Iozzi
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Updated 29 September 2020

AMC Saudi Arabia CEO upbeat about cinema prospects amid-COVID-19

AMC Saudi Arabia CEO upbeat about cinema prospects amid-COVID-19
  • ‘We can’t control the virus, but we can control and certainly minimize any type of infection within our four walls,’ John Iozzi tells Arab News

DUBAI: In 2018, Saudi Arabia opened its first cinema in more than 35 years with a private screening of “Black Panther,” granting AMC the first license in the Kingdom to operate movie theaters.

At the time, the US giant announced that it planned to open 100 cinemas by 2030 across the Kingdom.

This plan is still on track, said John Iozzi, CEO and managing director of AMC Cinemas in Saudi Arabia.

He took the reins of the Saudi operation early last year, moving from Australia to the Kingdom.

When offered the role, “the first thing that went through my mind was what a wonderful opportunity to join a part of the industry that’s at sunrise stage,” he told Arab News.

There are five AMC cinemas open in the Kingdom, with plans for three more to be opened through 2020.

Despite people spending the better part of 2020 at home, AMC has opened three cinemas this year alone, with one cinema each being opened in 2018 and 2019.

Iozzi chalks this down to the teething process of setting up a cinema business in a country that does not have the pre-existing infrastructure.

The first cinema, in King Abdullah Financial District, “was perhaps a symbolic gesture of the commitment to cinema in the Kingdom,” he said. The venue already existed, so it was relatively quick and easy to set up.

“From there, we morphed to the more traditional model of cinemas that are attached to activity centers (such as) shopping malls, and Panorama Mall was the first of these,” he said.

It is a multi-staged and complex process, from leasing and certification to design and construction, which requires sourcing of materials, contractors and consultants either from within or outside the territory.

“So in these first years, there isn’t going to be that same level of speed and efficiency that’s coming from the learnings from the evolution of the ecosystem,” Iozzi said. “As they say, success builds success and size builds size and stock sells stock.”

The initial learning steps followed by COVID-19 slowed down AMC’s plans, pushing sites that were scheduled to open this year to 2021.

COVID-19 “effectively placed various types of limitations, closures and other types of restrictions on building across a three-to-four-month period that really did slow us down a lot,” he said.

Even though AMC reopened its cinemas in early July, it is a slow recovery. “The impact was 100 percent back then,” he said.

Since then, cinemas are allowed to only sell 50 percent of their capacity. There are also distancing requirements between seats and at points of sale, such as cash registers and food counters, which add further complexity.

Moreover, the time between screenings is extended to ensure proper sanitization, which includes a partnership with Clorox. At this point, depending on the week, attendance ranges from 20 to 35 percent, said Iozzi.

“Given that we can only sell half the tickets we originally had, we’re relatively happy with how the public has responded,” he added.

He is aware that guests will be reticent, even afraid, to step out, but he is relying on those who have visited an AMC cinema to spread the word and inspire confidence.

“We can’t control the virus, but we can control and certainly minimize any type of infection within our four walls,” Iozzi said.

The pandemic’s effect on cinema is not limited to audience attendance. The bigger concern is content, with several big-budget movies such as the “Avatar” sequels, “The Batman” and “The Matrix 4,” among others, halting their production schedule or delaying it.

“I won’t deny that that won’t affect our revenue-raising prospects,” Iozzi said. “I think for us it’s about trying to equate supply with demand as much as possible so that we’re not giving out too many sessions that no one’s coming to.”

He said AMC is now looking beyond the “Hollywood formula” to different film industries such as those in Egypt and Saudi Arabia, as well as specialty products for Filipino, Indian and Pakistani audiences — a significant portion of the company’s audience base in major cities.

AMC is also looking beyond film to concerts, sports and gaming. “They’re never going to be a perfect substitute, but in terms of differentiation and getting some use for our assets, it does help,” Iozzi said.

Although consumption of streaming services has increased, he is not particularly concerned about its negative impact, if any, on cinema-going.

He believes that cinemas are like restaurants — everyone has a kitchen at home, but they are frequently eating out or ordering in.

“We’ve based our offering around this premise that people look for the social aspect of being out — the event experience … the superior seats, the superior sounds, the superior vision and screen, and the magic of being in the movies that cinema exhibition brings,” Iozzi said.

Moreover, he added, the shopping-mall infrastructure in Saudi Arabia has always been well patronized — malls are seen as safe, enjoyable, family-oriented places to spend time, and cinema fits well with that.

Iozzi acknowledges that a vaccine or any treatment for COVID-19 would be helpful, but that is out of AMC’s hands. “We make the best of the situation until that point,” he said.