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Oct. 19, 2019, 7:31 a.m. EDT

AMC Theatres launches streaming service in latest blow to Netflix

AMC is the first cinema chain to launch a streaming service, adding to a wave of new competition from Disney, Apple and others

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By Ciara Linnane, MarketWatch


MarketWatch photo illustration/iStockphoto, Getty Images
Reed Hastings, the Netflix founder and CEO, would be forgiven if he’s feeling a little hot under the collar.

In the latest blow to Netflix Inc., AMC Theatres, the biggest cinema chain in the world, said Tuesday it is launching a streaming service that will allow members of its loyalty program to rent or buy films and watch them at home, the first such offering from a cinema operator.

The 20 million-plus U.S. households that have signed up to the company’s AMC Stubs program will be able to access about 2,000 films from every major studio, starting Tuesday. Later in the year the service is slated to be expanded to include films from AMC Networks’ /zigman2/quotes/202022116/composite AMCX -3.18% IFC Films and RLJE Films. AMC Theatres will promote AMC Networks’ targeted streaming services, marking the first crossplatform marketing between the companies. Those services include Acorn TV, Shudder, Sundance Now and UMC.

Customers can rent or buy films through the AMC Theatres /zigman2/quotes/200235402/composite AMC -5.17% mobile app, Roku /zigman2/quotes/205087179/composite ROKU +5.19% and smart TVs with more services and devices to be added in the future.

“With more than 20 million AMC Stubs households, and with our website and smartphone apps already being visited hundreds of millions of times annually by movie fans, AMC Theatres is in a unique position to promote specific movies with greater personalization than has ever been possible before,” AMC Theatres Chief Executive Adam Aron said in a statement.

See: An Apple-Disney merger? Here’s how Bob Iger says it could have happened

AMC has agreements with every Hollywood studio to make select films available for rent or purchase, including new releases. Those will be made available after the traditional theatrical window set by studios has been observed. Consumers will be able to earn Stubs points that can be used for in-theater rewards.

See: Now that ‘Seinfeld’ is coming to Netflix, how does it stack up against Amazon, Apple, HBO, Hulu and Disney?

Also: Disney sets high bar with new $12.99 streaming bundle for Disney+, ESPN+ and Hulu

AMC shares were last up 4.5%, while AMC Networks was up 0.6%.

The news is the latest threat to the dominance of Netflix /zigman2/quotes/202353025/composite NFLX -3.05% , which has seen its stock fall 23% in the past three months as it awaits an onslaught of new competitors in the streaming world. Apple Inc. /zigman2/quotes/202934861/composite AAPL +0.96% and Walt Disney Co. /zigman2/quotes/203410047/composite DIS +7.32% are both set to debut streaming services in November; both are cheaper than Netflix’s offering.

Comcast Corp.’s /zigman2/quotes/209472081/composite CMCSA -0.07% NBCUniversal service and AT&T Inc.’s /zigman2/quotes/203165245/composite T -0.03% HBO Max are due in spring 2020.

Click to Play

Netflix's Hollywood Rivals Are Spoiling for a Fight

Disney, AT&T and Comcast have plans to enter the streaming-video ring, armed with well-known TV and movie brands. But can they hold their own against industry juggernaut Netflix? Photo illustration: Heather Seidel/The Wall Street Journal

Read more: As Netflix earnings nears, here comes an onslaught of competition — and content

Netflix, scheduled to report its third-quarter earnings on Wednesday, is already in competition with Amazon.com Inc. /zigman2/quotes/210331248/composite AMZN -1.40% and Roku Inc.

Imperial Capital analyst David Miller said the move will likely spur more loyalty from AMC’s Stubs members, and may help the company take market share from competitors.

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