Will booze in Arkansas movie theaters become the new normal?

Several Arkansas movie theaters either now offer or plan to introduce luxury seating and expanded concessions, but it is uncertain how soon the national trend of serving alcohol will become widespread in Arkansas cinemas.

Alcoholic Beverage Control representative Judy Chwalinkski said out-of-state cinema companies advertising that they will serve liquor in Arkansas movie theaters might have overestimated how easy it will be to get a license. But Little Rock cinema owner Matt Smith said it’s only a matter of time before the expanded amenities become industry standard.

The alcohol trend has gained speed nationwide. In 1997, 14 U.S. movie theaters served alcohol, and by 2008 that number was 400, according to the National Association of Theater Owners. Although there hasn’t been a widely published count since, media reports indicate the number has grown exponentially in the last five years.

Smith began selling beer and wine at his Market Street Cinema in 2000. It was an arthouse and independent film theater that shut down in 2014. Now, he shows mostly commercial movies at his theaters, Riverdale 10 VIP Cinema in Little Rock, Hot Springs VIP Cinema, Searcy Cinema 8 and Silver Screen Cinema 8 in Cabot.

Riverdale and the Hot Springs cinema have hot food offerings like pizza and chicken strips, reclined seating and beer and wine. Smith said after he finishes an expansion at the Hot Springs theater this year, he also plans to add those amenities at his other locations.

“That’s where the industry is headed,” said Smith, adding that part of the reason he loves the movie theater business is because it’s ever-evolving.

“In the ‘80s it was big, plush sound, THX. That was the rage. In the ‘90s it was stadium seating. The early 2000s, 2005-2008, it was all about moving to digital light projection and then 3D,” he said.

If a cinema company doesn’t adapt, it doesn’t survive. It will fall to the wayside with, for example, $1 theaters, which became unaffordable for operators after the switch from 35mm film to digital.

AMC SPOKESMAN SAYS CHANGES ARE ‘WIN-WIN’
Ryan Noonan, director of corporate communications at AMC Theatres in Leawood, Kan., disagrees that the cinema industry is always changing.

AMC has been rolling out its reclined seating additions and expanded food and drink for about three years, and in Noonan’s mind the business was somewhat “stagnant” before that.

“It was all about seeing how many people we could fit into the theater, and the industry wasn’t really focusing on what guests really wanted out of the experience,” Noonan said. “Since we started this process, we found guests really respond when you provide them with an experience that gets them excited.”

The renovations cost about $300,000 to $500,000 per cinema, and AMC will ultimately spend $600 million on its planned upgrades, according to The Hollywood Reporter. The AMC Fiesta Square 16 in Fayetteville is being renovated and will soon offer reclined seating throughout, in addition to a Coca Cola Freestyle drinks and an expanded menu of hot items like pizza and mozzarella sticks. Noonan said the ticket cost will not initially change, but in other markets demand has driven the price up by about $1.

Adding recliners will reduce seating capacity by half, but Noonan said he’s not worried about that causing a negative effect on the bottom line for AMC, which has about 10,000 screens and became the world’s largest theater company when it acquired Carmike Cinemas last year.

“We find the popularity of these renovations mean more people to fill those seats. It’s a better experience for the customer, and we have more people in the seats. It’s a win-win,” Noonan said.

Indeed, 2016 saw record food and beverage revenue at $1 billion and record admission revenue at $2 billion for AMC, according to the company’s annual report.

LIQUOR AND MOVIES IN ARKANSAS
As it has in 240 theaters in the U.S., AMC also plans to bring its trademarked MacGuffins bar and lounge concept to the Fayetteville cinema. However, its application has not yet been approved by ABC.

Only a handful of theaters in Arkansas hold liquor licenses. In addition to Smith’s theaters, Rave Cinemark Colonel Glenn 18 and the Ron Robinson Theater in Little Rock each have beer and wine permits, and the Movie Lounge in Fort Smith has a full restaurant that serves liquor and hosts movie screenings, according to ABC.

For a wine and beer permit, the facility is not obligated by the law to serve food, but a large attendance facility permit, for which AMC Fiesta has applied, the cinema must prove it is capable of serving full meals for hundreds, said Chwalinski, administrative assistant to ABC Director Bud Roberts.

Chwalinski said cinemas should wait until they have gone through the process before advertise liquor sales

“Some of these companies coming in from out of state, they might find that they’ve done things in other states that they can’t do here,” she said.

MALCO MAKEOVERS
Malco Theatres of Memphis announced in November it would serve cocktails starting this summer at several area theaters, including Malco Razorback 12 Cinema in Fayetteville. The company as of March 7 had not applied for an Arkansaspermit, but a spokesman said the company was in the process.

Planned upgrades to the theater also include reclined seating and an expanded kitchen to accommodate the service of “typical cinema grill fare,” said David Tashie, vice president of operations and construction.

Renovations are underway and the Razorback will stay open throughout. Malco Sunset Cinema 9 in Springdale is temporarily shut down while it gets a full makeover in its lobby and auditorium, and the Fort Smith Mall Trio Cinema will receive the same treatment. Tashie said the two theaters should be up and running by the summer and will become first-run, rather than second-run, theaters. New ticket prices are still under discussion.

The Rogers Towne Center Cinema will be the next in line for an auditorium remodel, followed by the Hollywood 12 Cinema in Jonesboro.

The company has about 40 cinemas, mostly in the South, and Tashie said Northwest Arkansas “is sort of Malco’s second home.” He said the improvements, for which the privately held company would not share the costs, “will make for more of a whole night out at the theater.”

While flat attendance at movie theaters has made national headlines in recent years, Tashie said Malco hasn’t felt a hit.

“We’ve held our own as far as ticket sales. We’re satisfied with our attendance.”

HEALTH OF THE INDUSTRY
Nationwide, there were 1.3 billion movie tickets sold in 2016, down slightly from the previous year, according to the Motion Picture Association of America. The number of tickets sold has hovered between the 1.2 billion and 1.4 billion marks since 2006.
Box office revenue was $11.25 billion, down slightly from 2015 at $11.29 billion, according to the MPPA.

Area cinema operators say an increase in entertainment options means they must improve their product, but they say it doesn’t mean the industry is on a decline. People have been looking to call the time of death for the movie theater business for 75 years, Smith said.

“If you look back to 1950s, TV was going to put the movie business out. After that, color TV was going to put the movie business out, then cable TV, then satellite TV was going to put the movie business out. Then it was DVD, and now it’s streaming services.”

Smith believes the argument doesn’t hold up.

“Our customers are people who want to get out of the house. You can go to a concert or listen to music at home. You can go to a sports event, or watch it at home. Home entertainment is not a competition for us,” he said.