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PARAMOUNTS CHICAGO PLAN<br />
PUTS FILMS ON A BID BASIS<br />
B&K Must Now Compete<br />
For Product in 16<br />
Sales Districts<br />
CHICAGO—A new Chicago releasing<br />
plan wiU be introduced in this area on January<br />
1 by Paramount, as a result of the<br />
consent decree, and Balaban & Katz theatres<br />
for the first time since they became<br />
affiliates of the producing-distributing<br />
company will not hold exclusive rights to<br />
first run Paramount pictures.<br />
Paramount has divided the Chicago area<br />
into 16 districts, with bidding one of the big<br />
factors in the manner in which product will<br />
be sold. Balaban & Katz theatres will hereafter<br />
not only compete for Paramount product<br />
in its showcase Loop theatres but will be<br />
required to compete for first subsequent runs<br />
in each of the 15 other districts in which it<br />
has theatres.<br />
EXCLUSIVE LOOP RUN<br />
Loop theatres will have an exclusive first<br />
run for an area which includes Hammond<br />
and Gary, Ind., but thereafter there will be<br />
bidding for first nms in each district.<br />
There is great interest in the plan here, not<br />
only because for the first time Balaban &<br />
Katz will be competing for Paramount product,<br />
but also because the plan may set the<br />
pattern for product of other companies in<br />
which production and distribution are being<br />
divorced from exhibition.<br />
Under the plan, the Loop area will have 13<br />
theatres and all may bid if they desire for<br />
Paramount pictures, and it is expected that<br />
both the Oriental Theatre which is an Essaness<br />
house and the Chicago Theatre which<br />
is the B&K flagship will become the principal<br />
bidders for the product. A theatre which<br />
loses a bid, however, does not lose the right<br />
to play the picture later. Paramount also<br />
The Chicago area as divided into sales<br />
districts by Paramount nnder new plan.<br />
Text of Paramount's<br />
Paramount's Chicago releasing plan as<br />
outlined in a letter sent to all exhibitors<br />
in the area this week follow:<br />
Beginning with the first Loop run of "The<br />
Heiress" and the first outlying runs of "The<br />
Great Lover," Paramount releases will be offered<br />
to you in the following manner:<br />
The cities of Cliicago, Gary, Hammond, and<br />
their suburbs, including all of that area which<br />
Paramount has referred to as its Chicago city<br />
releasmg area, have been divided into 16<br />
Paramount districts, each having a compass<br />
and numerical designation.<br />
A single first run in the above-described<br />
areas will be offered to one theatre in the<br />
Paramount district Loop. In this district, one<br />
second run, and multiple third, fourth and<br />
subsequent runs will be offered. In each of<br />
the other Paramoimt districts, there will be,<br />
generally, one first outlying run, and multiple<br />
second, thiid, fourth and subsequent runs.<br />
We hope to achieve by this plan a method<br />
that will prove to be the best possible diswill<br />
offer pictures for one second run and<br />
multiple third, fourth and subsequent runs.<br />
Losers on the first run in this district as well<br />
as in others may bid or negotiate for later<br />
runs.<br />
One effect of the new system will be to permit<br />
Balaban & Katz to get longer runs on<br />
pictures they are able to buy. Under the<br />
Jaclcson Parle decree they have been limited<br />
to two weeks on Loop pictures, unless the<br />
court granted special consent for a longer<br />
run. This has been a financial handicap to<br />
the circuit and, in the case of Paramount, has<br />
limited Loop earnings for its product booked<br />
into the Chicago Theatre.<br />
In a letter sent to all exhibitors in the area,<br />
Chicago Plan<br />
tribution procedure, and one which we believe<br />
will satisfactorily serve our customers<br />
and the public.<br />
We will invite competitive offers from all<br />
of the theatres in Paramount district Loop<br />
for the one first run in the entire Chicago<br />
city releasing aiea. We will also invite competitive<br />
offers from all of the theatres in<br />
each of the other Paramount districts for the<br />
one first outlying run which we will offer<br />
generally in each district. We will accept that<br />
offer from a theatre in each Paramount district<br />
which we ijelieve will result in our<br />
obtaining the greatest film rental. We reserve<br />
the right to reject any or all offers for<br />
any run if the offers, in our opinion, do not<br />
provide a fair and reasonable film rental for<br />
the run to be licensed.<br />
FOR REASONABLE CLEARANCE<br />
If all of the offers are deemed to be inadequate,<br />
or if no offer is received, we will<br />
then negotiate with a theatre or theatres<br />
according to our best judgment.<br />
In inviting competitive offers, and in negotiating,<br />
in Paramount district Loop, we shall<br />
consider requests for reasonable and necessary<br />
clearances, except where court decrees<br />
prevent such consideration.<br />
If an exhibitor with a theatre located in<br />
Paramount district Loop does not submit an<br />
offer for "The Heiress" for the Loop first<br />
run, or if an exhibitor with a theatre located<br />
in any other Paramount district does not submit<br />
an offer for "The Great Lover" for the<br />
first outlying run, we will assume that he is<br />
not interested in this mm. However, if at<br />
any time in the future that exhibitors wishes<br />
to submit an offer for a first run in his<br />
Paramount district on any later release, he<br />
need only give us reasonable notice.<br />
TO NEGOTIATE MOST RUNS<br />
For runs after the first run in each dis-<br />
Paramount said it reserves the right to reject<br />
any or all offers for any run if the offers,<br />
in its opinion, do not "provide a fair and reasonable<br />
trict, we intend to negotiate with particular<br />
film rental for the run to be licensed."<br />
theatres as outlined on the attached list.<br />
If all of the offers are considered inadequate,<br />
We have decided upon this method primarily<br />
or no offer is received, the company then because we believe it gives a maximum flexibility<br />
in the practical conduct of our business.<br />
intends to negotiate with exhibitors "according<br />
to our best judgment."<br />
Our selection of theatres has been made on<br />
The plan has two exceptions in its general the basis of our opinion of the best licensing<br />
plan. The Piccadilly Theatre, of the Schoenstadt<br />
opportunities for each run. However, if you<br />
circuit, gets first crack at product in its wish to license a Paramount picture on any<br />
district because of an antitrust settlement multiple nm in your district, for which another<br />
theatre has been selected, you need<br />
with B&K Paramount and others in lieu of<br />
financial damages. The Jackson Park Theatre<br />
only to inform us of your desire in writing.<br />
also is unaffected in the setup because We shall then invite competitive offers from<br />
of the decree in its case.<br />
you and from such other theatre or theatres<br />
The plan goes into effect for "The Heiress" in your Paramount district as we may determine<br />
to be necessary to achieve the best<br />
and "The Great Lover."<br />
The Paramount office has submitted sample<br />
licensing opportimity. In every such case, we<br />
bidding procedures to exhibitors. Ex-<br />
will accept that offer which we believe will<br />
hibitors bidding for product will be asked to result in our obtaining the greatest film<br />
submit terms, seating capacity, number of rental from the run licenser, subject to our<br />
days picture will be played, and dates of the<br />
week to be played, adult evening prices which<br />
right to reject inadequate offers.<br />
If we are unable to negotiate a license with<br />
the theatres will be charged for the run, any theatre selected for a particular run. we<br />
whether the picture will be a single or double shall, subject to the terms of licenses granted<br />
feature, amount to be spent on advertising to other theatres for the particular picture,<br />
and clearance desired.<br />
negotiate with another theatre in that district<br />
BOXOFFICE :<br />
: December 24, 1949
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