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How does the cinema industry survive coronavirus in Britain?

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how does the cinema industry survive coronavirus in britain

The future of many cinemas across the country hangs in the balance. Despite the easing of lockdown, ensuing social distancing safety while earning enough revenue to stay afloat, means for some, they cannot reopen immediately.

In terms of the big chains, Odeon and Showtime have reopened venues with social distancing measures in place, while Cineworld and Vue have delayed opening their doors until the end of July.   

Cinemas have suffered financially from months of lockdown and some have turned to alternative forms of entertainment – for example, Curzon launched a home video on demand services – to keep ticking over.

Out of this world? The new Ōma cinema in Paris is set to look like the galactic senate chamber from Star Wars' Phantom Menace (read about it at the bottom of the article)

Out of this world? The new Ōma cinema in Paris is set to look like the galactic senate chamber from Star Wars' Phantom Menace (read about it at the bottom of the article)

Out of this world? The new Ōma cinema in Paris is set to look like the galactic senate chamber from Star Wars’ Phantom Menace (read about it at the bottom of the article) 

What’s more, they have to create an attractive enough experience to entice viewers out the comfort and safety of their home and compete with the entertainment packages and gadgets they’ve invested in during lockdown.

This includes projects, surround sound systems, better televisions and streaming packages, meaning thousands of films on demand.   

Luxury cinemas are set to open with Covid-19 safety features as well as one with a style that’s set to give you an out of this world experience. But will it be enough? 

Home entertainment and savings vs cinema costs 

The cinema is the top leisure activity that was missed during lockdown by more than a third of the 1,513 respondents it surveyed, according to a survey by online marketplace OnBuy.

However, many have found alternative ways to get that cinema experience. 

According to OnBuy’s internal data, it has seen a 365 per cent increase in at-home projectors sales since lockdown began.

Culture Secretary Oliver Dowden announced on 11 July that performing arts could take place outdoors. The Government would also work with the sector to pilot a number of small indoor performances

Culture Secretary Oliver Dowden announced on 11 July that performing arts could take place outdoors. The Government would also work with the sector to pilot a number of small indoor performances

Culture Secretary Oliver Dowden announced on 11 July that performing arts could take place outdoors. The Government would also work with the sector to pilot a number of small indoor performances

This suggests that people are prepared to create the cinema experience at home but what’s unclear is whether they will be satisfied with this set up for the long term. 

For now though it’s become a garden party essential.

According to another survey conducted by Bacardi, one in twenty homeowners are entertaining their guests with DJ decks and outdoor cinema screens.

The savings made during lockdown could prevent cinema goers from returning as well. 

According to Sunlife, the ability to go to the cinema, having a haircut and going out for meals has saved the over 50s £316 during the last 12 weeks of lockdown.

There is also the aspect of being in close quarters with other cinema goers, which will simply put many off.   

In spite of lockdown The Arc Cinema chain has opened a new luxury £3million Hucknall branch called The Byron and is set to develop more

In spite of lockdown The Arc Cinema chain has opened a new luxury £3million Hucknall branch called The Byron and is set to develop more

In spite of lockdown The Arc Cinema chain has opened a new luxury £3million Hucknall branch called The Byron and is set to develop more

What will cinemas do to entice you back?

Outdoor experiences are now allowed and some of the entertainment industry has turned to offer such productions.

This includes drive-in cinema, concerts, comedy and even opera.  

There’s also been plenty of investment into these experiences to offer more than what people have at home.

The VAT reduction announced by the Chancellor should offer a stimulus to all customers, but it will be interesting to see if all cinema operators pass on the full benefit to customers or try to make up some of the lost revenue during lockdown.’ 
Rob Arthur, co-founder, The Big Picture Cinema Consultants

Ian Brown, chief executive of Indy Cinema Group Ltd, highlights what we can expect: ‘Modern drive-in or pop up cinema is more than just showing a film outdoors, it is an entire experience, it is about food, drinks and an overall sense of spectacle.

‘The pop-up drive-ins that are happening right now are using technology in a very interesting way. 

‘Everything can be delivered to your car and everything is at your fingertips.

‘The advanced LED screens has also made for all the drive-in cinema at the highest possible quality with the brightest picture. 

‘The perfect solutions managed to combine the magic of the old American drive-ins with the technology of this generation.’

While restrictions have eased somewhat it will be a while still before many can enjoy an indoor experience at more cinemas.

Bargain tickets before Hollywood reopens

Many cinemas have struggled under lockdown despite of government pledging a £1.57billion rescue package to help the arts, culture and heritage industries.

Even major cinema multiplexes are still struggling on the back of debt they accumulated before the UK went into lockdown.

A rise in ticket prices and those movie snacks could be the answer, but it is unlikely to be popular with cinema goers, especially in the wake of a VAT cut, which will be charged at 5 per cent instead of 20 per cent. 

Rob Arthur, co-founder, The Big Picture Cinema Consultants points out: ‘In most markets the pricing of tickets has remained at the same level or lower when re-opening cinemas.’ 

‘What I predict will happen in around nine months’ time (March 2021) will be more pop-up operators creating better social distanced outdoor events rather than drive-in much like the Luna or Rooftop Cinemas in the UK 
Ian Brown Indy Cinema Group

But this could change once Hollywood opens up again. 

He adds: ‘New releases are likely to be much sought after so unlikely to attract a discount.’

Cinemas are also unlikely to ditch their loyalty schemes. 

Arthur says: ‘In a recent Kantar survey of 15,000 people across the UK it was interesting to note that cinemas with loyalty or membership programmes were deemed to be the companies most of interest to consumers who may be considering binging on cinema.

‘Younger people and families were more inclined to return, while over 45s may be less keen.’

But there are still other ways where the entertainment industry could make its money, especially through screen advertising and offering video on demand services.

Cinema goers will have to adhere to social distancing measures if they want to continue to enjoy the indoor experience

Cinema goers will have to adhere to social distancing measures if they want to continue to enjoy the indoor experience

Cinema goers will have to adhere to social distancing measures if they want to continue to enjoy the indoor experience

Arthur adds: ‘The VAT reduction announced by the Chancellor should offer a stimulus to all customers, but it will be interesting to see if all cinema operators pass on the full benefit to customers or try to make up some of the lost revenue during lockdown.’

Smaller players, while better able to adapt, will also be hit hard. ‘Smaller independent operators have many challenges ahead. 

The impact of social distancing and the smaller seating capacities means that the viability of many cinema and theatre venues will be called into question.

‘The support packages offered by government are sorely needed and welcome, but nothing can replace the revenue stream of a full house and the ancillary spend including the ice cream during the break.

‘The economic quandary is that we are facing a recession with disposable income being restrained so cinema and theatre operators cannot be greedy.’

Adapt and survive

Brown maintains that the outdoor cinema experience will become the main type of cinema experience that most people will enjoy this summer and that there will be a boom in drive-in cinema across the world.

He says: ‘I also feel that only the ones that truly focus on the customer experience rather than the convenience of the current demand will survive.

‘This will also lead to certain operators excelling in the field and becoming a regular feature for the foreseeable future.

‘What I predict will happen in around nine months’ time will be more pop-up operators creating better social distanced outdoor events rather than drive-in much like the Luna or Rooftop Cinemas in the UK.

But indoor establishments will not go down without a fight and some have already opened up, albeit cautiously.

The Arc Cinema's Byron theatre will not be the only newly developed cinema to open

The Arc Cinema's Byron theatre will not be the only newly developed cinema to open

The Arc Cinema’s Byron theatre will not be the only newly developed cinema to open

The Odeon, which reopened from 4 July, says it’s limiting the number of seats for sale for each film and guaranteeing seats between parties to meet social distancing requirements.

Some, like The Arc Cinema are expanding. In July, they opened a £3million luxury cinema in Hucknall, Nottinghamshire. 

Brian Gilligan, director of the The Arc Cinema, says: ‘We have more cinemas in development around the UK at the moment, and Covid has not changed our plans or our ambition to help people to share a cultural experience or come together for a great night out. 

‘Our business wants to bring the silver screen to locations that otherwise have to travel long distances to share films together – with the appropriate distancing techniques in place of course. 

‘The future of us is about carving out a unique role close to the hearts of our communities.’ 

Indoor cinemas could compete – provided they adapt – and this has already been demonstrated with the creation of the Ōma cinema, which will boast a ‘vertical immersive experience’ – similar in design to the galactic senate chamber in Star Wars’ Phantom Menace.

Arthur says: ‘There are new cinema designs, such as the Ōma, which is set to launch in Paris in 2021, which are already inherently socially distanced.

‘This ‘theatre box’ design means not only is every seat the best in the house, but its innovative concept automatically means people aren’t sitting in such close proximity. 

‘Thinking differently about the big screen means that the medium can continue to thrive.’

The Ōma Cinema: Is it the future? 

You’d be forgiven for thinking the Ōma Cinema was designed with social distancing in mind, but the developers have always planned to build the cinema this way. Here are some facts about it:

· It is being described as a ‘truly different cinematic concept, offering spectacular architecture, an intimate atmosphere, an ‘a la carte’ service and truly unique experience for cinema operators and their audiences.’

· Building has commenced and it’s due to open in 2021. It is replacing another cinema that was on the premises.

· The architecture of the Ōma cinema is based on three major features: an original ‘platform’ layout; a flexible seat arrangement in each ‘balcony’; and projector positioning among the seating ‘pods’ allowing audiences to get much closer to the screen and the action.

· Ōma says the cinema is compatible with any type of digital projection and sound system technology on the market.

· Operators can choose the size of each platform, number of levels, platforms per level, as well as seating configurations per platform.

· The cinema is being designed by architect Pierre Chican who has already designed the UGC Les Halles (where 3.1million tickets were sold in 2019) and UGC Bercy (where 1.9million tickets were sold in 2019) in Paris.

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First-time buyers frozen out of housing market

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first time buyers frozen out of housing market

Existing homeowners have overtaken first-time buyers as the biggest source of demand in the housing market. 

Online estate agent Zoopla said the change had resulted from the coronavirus pandemic as younger families had been increasingly shut out by lenders. 

Changing landscape: Zoopla's latest house-price index found demand from homeowners looking to move had risen 48 per cent over the first three months of this year

Changing landscape: Zoopla’s latest house-price index found demand from homeowners looking to move had risen 48 per cent over the first three months of this year

Zoopla’s latest house-price index found demand from homeowners looking to move had risen 48 per cent over the first three months of this year. 

Demand from first-time buyers was up 11 per cent – the first time since 2017 that first-time buyers had not been the biggest driver.

This post first appeared on dailymail.co.uk

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Royal London and LV= in talks about £500m tie-up

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royal london and lv in talks about 500m tie up

Royal London and rival financial services firm LV= are in talks about a £500m tie-up. 

The potential deal could see the pair combine their life insurance, pensions and asset management divisions. 

Tie-up talks: The potential deal could see the pair combine their life insurance, pensions and asset management divisions

Tie-up talks: The potential deal could see the pair combine their life insurance, pensions and asset management divisions

It would mean that LV=, better known as Liverpool Victoria, would end its 177-year run as an independent business. 

The two companies could form a ‘mutuals champion’ boasting some 10m UK customers, sources told Sky News. 

Royal London is Britain’s largest mutual insurer. 

Private equity firm Bain Capital is seen as a potential rival bidder for LV=, which is thought to be worth between £500m and £1billion.

This post first appeared on dailymail.co.uk

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RUTH SUNDERLAND: HSBC’s woes a mirror to the world

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ruth sunderland hsbcs woes a mirror to the world

HSBC, the international bank headquartered in London’s Canary Wharf, is deep in crisis. On the London stock market, its shares have fallen by 50 per cent since January to their lowest level for a quarter of a century. 

Twenty years ago they stood at around £10. They are now hovering around £2.80, in a catastrophic destruction of value. Obviously, this is worrying for investors and customers, but also for UK plc and for our banking industry. 

If HSBC’s stability were to be threatened – and we are a long way from this – it would be a danger to the UK’s financial system. 

Concern: If HSBC's stability were to be threatened it would be a danger to the UK's financial system

Concern: If HSBC's stability were to be threatened it would be a danger to the UK's financial system

Concern: If HSBC’s stability were to be threatened it would be a danger to the UK’s financial system

The problems facing chairman Mark Tucker and chief executive Noel Quinn are multi-faceted and look intractable. The most recent blow is the allegation that the bank allowed fraudsters to launder millions of dollars of dirty money. Quinn may feel confident these accusations will not lead to enforcement action, given that they date back years and the bank has taken action. 

But it touches a raw nerve. 

HSBC has run foul of the regulators several times including incurring a £1.5billion fine in the US for acting as a conduit for Mexican drug lords and a huge tax evasion enterprise via its Geneva branch. 

Worryingly for the top brass, investors in Hong Kong are losing faith. Unusually, some have even gone public. Hong Kong shareholders were furious at the suspension of the dividend, at the behest of the Bank of England. No conclusion will be reached on whether or not the divi will be restored in 2021 until the end of this year: if it is not, there will be trouble. 

Along with the other banks, HSBC is exposed to the risks that the global economy will tank in a second wave, piling up even more bad debts on top of the £10billion or so of write-offs already expected.

Changes to accounting rules mean the banks must cordon off money to cover possible nonrepayments at an early stage, and HSBC believes it has made ample provision. Events may prove otherwise. 

The biggest difficulty, however, is that HSBC is piggy in the middle in tensions between Beijing and the White House. 

This situation is delicate. HSBC cannot afford to lose its licence to operate in the US, given the dollar’s central role in world trade. Nor can it offend the Chinese, since the lion’s share of profits is made in Asia. 

Quinn, whose job it is to sort it all out, is a quietly impressive Midlander. The pandemic means he runs the global bank partly from home and partly from the virtually empty Canary Wharf nerve-centre. A programme of 35,000 job cuts was put on hold due to the virus but has now resumed. 

He is also looking to slash costs, including from the $400m travel budget. Quinn will seek to dispose of buildings in London and elsewhere as staff work from home. He may sell off the bank’s emergency premises. Working from home, rather than a back-up office, is now the contingency plan. 

Quinn’s approach to strife in Hong Kong and to the US-China conflict has been to keep a low profile and not to choose sides. 

The bank has 155 years of history and a wealth of expertise in its ranks. But its raison d’etre is international trade, which is being challenged as never before – by protectionism in the White House, belligerence in Beijing, Brexit and the pandemic. 

HSBC’s woes hold up a worrying mirror to the world.

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