CinemaCon 2017: Byron Berkley, NATO Marquee Award

Byron Berkley learned the business from the ground up. He began his career as a teenager, performing the often thankless tasks that form the backbone of exhibition: sweeping aisles, welcoming guests, and handling reels behind the booth. Berkley’s time in exhibition includes stints at managing both indoor and drive-in cinemas, theatrical sales for concessions operators, and, in recent years, a return to overseeing the day-to-day joys (and accompanying stress) of an independent exhibitor. Boxoffice talked with Berkley about his journey from a marquee boy to recipient of NATO’s Marquee Award.

What was your first job in exhibition?

My very first job in exhibition was as a marquee boy, janitor, doorman, and projectionist in the Brisbane theater in Brisbane, California. I started working there when I was 13 years old and after a two-year stint moved across town to a competitor’s theater, where I worked at night as a projectionist throughout high school and into college.

What lessons about the industry did you pick up from those early days?

I recognized early on that it was a business that required true dedication and commitment in order for one to be successful—having a love for movies helped a lot, too. Working long hours at inconvenient times was not for everyone, so you really had to enjoy providing entertainment for others; being away weekends, nights, and holidays isn’t most people’s idea of an ideal career. Keep in mind that at this time the movie theater was still the primary form of entertainment away from home, so the satisfaction you got from watching crowds get so much enjoyment was truly rewarding and more than made up for not being able to lead a “normal” life. Working the floor and being in constant contact with the public was the most enjoyable part of my early theater employment, but being a projectionist, which I was for some time, was an entirely different experience. These were the days before platters and xenon bulbs, so the person in the booth couldn’t leave his post and had no opportunity to interact with the public—he was almost a hermit, disappearing into his small, dark room and not coming out until everyone had left for the day. Although I enjoyed watching over the film as it ran through the projector reel by reel, the isolation of being alone and away from the public wasn’t my first choice.

You managed indoor and drive-in theaters for United California Theatres; what were the challenges you faced?

Both then and now we seem to be facing the same challenge, declining attendance and how to keep the moviegoing experience relevant for the consumer. During my time with United California Theatres, we started to see an erosion of attendance in favor of home movie viewing, as the studios were releasing more of their feature film libraries to the networks. The multiplex had not come into existence quite yet, and since UCT properties were single-screen venues with large auditoriums, they were increasingly difficult to run profitably; we began to put more and more emphasis on concessions operations as a hedge against declining box office revenues. As time went on, home movie viewing became an even bigger threat as the VCR came into popularity, followed soon afterward by the growth of cable television, all of which continued to drive attendance away from theaters. UCT was in partnership with UA theaters, and the Naify family, who controlled UCT, eventually acquired control of UA theaters, merged the two companies, and formed United Artists Communications, which then expanded into the cable television business. The philosophy at the time was that if cable TV was going to damage theatrical revenues, the company might as well be in both businesses, which proved to be a prescient and profitable decision. I definitely see some parallels between what was then a threat to theatrical revenues from network television, the VCR, and cable and what we are seeing now with the various out-of-theater viewing platforms such as Netflix, Amazon, and others. Like Yogi Berra is reputed to have said, “It’s like déjà vu all over again.”

How did your exhibition background help you in the concessions side of the business?

I left UCT after 12 years and joined the Dr Pepper Company as a theatrical sales representative. Having spent time with UCT and being focused on concessions sales as we were, it gave me the ability to relate to other concessions operators and address their issues. Knowing the importance of merchandising, customer service, and bottom-line profit margins allowed me to position my product favorably to the buyer and demonstrate how it could benefit his operation. After leaving Dr Pepper I joined Sunkist Soft Drinks as VP of sales and, since Sunkist was owned by General Cinema at the time, I had the benefit of working with some excellent concessions people at GCC. I learned a great deal from this association and, in particular, from GCC’s concessions VP, Jack Leonard. I have no hesitation about borrowing successful ideas from someone else, and I’ve benefitted immensely from what I’d learned and later borrowed from GCC.

What led to your decision to return to exhibition after that period, and how had the industry changed when you returned?

Since I’d been in and around theaters since high school, I’d grown to really love the business and, although I had indirectly left it to work for Dr Pepper and Sunkist, I was still involved as a supplier. Sunkist was headquartered in Atlanta, and when General Cinema decided to divest the business I began looking for other opportunities in case the new owners and I might not get along. I learned of a theater that was for sale in a small town in Texas and made a decision to start a new career as an owner-operator. It helped that the town was near my wife’s hometown, and since she wanted to move back to Texas, it wasn’t a hard decision to make. What I’d found to have changed the most since my return was that the business had become much more impersonal and “corporate,” if you will. When I was a manager with UCT and when I worked in my hometown theaters as a teenager, everyone seemed to know everyone and it was a much more familial industry. “Film row” existed in most of the major cities, and you had personal contact with most of the salespeople and the supply houses. Theaters were visited regularly by film people and by representatives from National Screen Service, so there was a lot of information that was exchanged—it was a very close-knit and personal industry. There were nowhere near the number of screens we have today nor, for that matter, the number of large and midsize circuits so, structurally, it is a much different business. In many ways it is more professionally managed than it was, with more emphasis on good business practices, but I do miss the personal nature of the way it was.

How long have you been involved with NATO?

I’ve been a NATO member for just over 25 years and have served on a number of committees and task forces during that time, including membership, investment, conventions, and strategic planning. My longest committee tenure has been with the Independent Theatre Owners Committee, on which I’ve served in various capacities since its inception. I was fortunate to have had the opportunity to work very closely with other long-time NATO icons Wayne Anderson, Larry Hansen, Paul Rogers, and others during the organization of the original Cinema Buying Group. I currently serve as NATO’s treasurer and as one of four elected independent representatives on the NATO Executive Board. On a regional level, I’ve been a long-time member and past president of NATO of Texas until we merged Texas, Arkansas, Oklahoma, and Louisiana into a larger regional association, which became South Central States NATO. I served as both president and chairman of this new regional organization and was involved in the ultimate merger of that organization with Missouri and Kansas NATO units to form Theatre Owners of Mid-America (TOMA), where I currently serve as president. Initially I became involved with NATO because it afforded me an opportunity to meet other like-minded exhibitors and share with them many of the issues and concerns that confront our business. I later found that joining and participating in committees and task forces gave me an opportunity to personally contribute to NATO and, working with others, help make the organization a more valuable resource for the membership.

What is the role of independent cinemas in today’s exhibition business, marked by corporate consolidation?

The continuing consolidation of exhibition has, in my opinion, made it more difficult for the smaller operator, in that consumer theatrical expectations are being raised; the larger, better equipped venues have proliferated and have become the expected norm for many moviegoers. The smaller exhibitor often doesn’t have the financial resources to meet the competition and can suffer accordingly if he can’t offer all the bells and whistles that are becoming commonplace. That said, there is still a market for the smaller independent if he is sufficiently isolated and remains the most convenient go-to movie venue in his trade area. Even in more competitive situations there can still be success for an independent if he can offer a point of difference: better service, better pricing, alternative programming, and playing a role in the community can all work toward retaining a loyal audience and keep the independent theater a viable part of the community.

What are some of the biggest challenges and opportunities facing independent exhibitors today?

Film availability continues to be a problem with the indie operator, as distributors still maintain a business model that was formed in the early days of film. Today’s consumer wants his movie entertainment on the break and not two or three weeks later. “Day-old bread” is no longer acceptable to today’s moviegoer, so that is a definite problem we face and one that our distribution partners are going to have to address. Probably the biggest and most immediate challenge is the possible dissolving of the theatrical window as we know it. Should the consumer feel that he can watch a new movie at home or on his iPad for $25 or even $50 while it’s showing in his local theater, I think that’s going to have more of an impact on the smaller operator than on the larger ones. If a premium video-on-demand (PVOD) movie is available day and date at the local cinema or even a few weeks later, what will be the incentive to leave home and patronize the cinema? Perhaps if you have an entertainment complex with bowling alley, rock climbing, restaurant, bar, game room, and bumper cars all under one roof there will be sufficient reason to see a movie while you’re there and you’ll go; if you don’t have all those periphery attractions, then I have some serious concerns about how incentivized you’ll be to go out just for a move in a traditional theater.

How do you think the moviegoing experience will change in the next 10 to 15 years?

Well, I wish I had a crystal ball—I could make all the right decisions over the next few years and be a billionaire. Change it will, but how is not much more than an educated guess at this time. This is a mature business, and if you track it over the past few years, raw attendance has not grown, which is something of a predictor for the future. So, in order to hold our own at least, we will have to implement some changes in how we position and operate our theaters. As I’ve mentioned, I think we will see the family entertainment center become more and more prevalent, eventually supplanting many of the traditional movie venues. Things like improved viewing comfort and better sound and visual presentations will have to be ongoing and continue to push the technology envelope. Food and adult beverages will become commonplace as the public will come to expect it. With the tentpole picture occupying more and more of the box office gross space, I see moviegoing becoming more of an occasional event than an everyday or every week practice, and concurrent with that I see a lot of smaller venues either closing down or perhaps introducing non-movie entertainment to fill in the gaps between the tentpoles: sporting events, eSports, and other non-theatrical events could be an alternative to going dark while waiting for the next tentpole. Somebody said, “Things that don’t change remain the same,” so as this business continues to evolve, changes will continue to occur.

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