Teenage boys have been showing up in suits and carrying bananas to theatres across Canada. And it’s the kind of thing that Ellis Jacob was waiting to welcome back.
What they’re getting dressed up to see is Minions: The Rise of Gru. The social media stunt is part of what the Cineplex CEO is happy to see after his over 170 locations were intermittently closed during the past two pandemic years. In his view, there’s no experience like watching a new release on a big screen.
The reopening couldn’t have come soon enough. It took until April 18 for all locations across Canada to operate without restrictions, some 25 months after all Cineplex doors initially slammed shut.
His message to moviegoers is that you can’t get these experiences sitting on your couch. In fact, during the months that Jacob and his customers couldn’t access any of the auditoriums—or do many social activities whatsoever—he didn’t sign up for services like Netflix. Binge-watching isn’t his speed.
“I just have so much going on,” he explained to The CJN Daily. “I can’t sit here to watch seven episodes of something.”
Nor does he have a giant movie screen in his Toronto condo, despite the urging of wife Sharyn. He’d rather walk over to the Varsity cinemas, which include VIP rooms accessible to everyone.
“That’s why we own theatres across the country,” said Jacob with a smile. “So we can go to it.”
How he got to the top
Ellis Jacob has been at the helm of Cineplex for nearly 20 years. The trained accountant’s professional journey began in his native Kolkata, India, watching Bollywood films. He moved to Canada in 1969 where he earned university degrees from McGill and later York.
After working for the Ford Motor Company and Motorola, he first joined what was then Cineplex Odeon Corp. in 1987, as the chief financial officer. Within a decade, after helping to bring a beleaguered company back from the brink, Jacob was the company’s chief operating officer.
It didn’t take long to find himself in demand to manage a rollercoaster of mergers and acquisitions throughout the North American industry, which involved names like Galaxy and Lowes. After his return to Cineplex, the company acquired Famous Players—and Jacob was now in charge of multiple movie exhibition legacies founded by fellow Canadian Jews.
But it was during the pandemic that Jacob found himself contending with an unprecedented challenge, a period when 170 locations went dark. Cineplex losses totalled $872 million during 2020 and 2021, and thousands of employees were let go. And even when venues in some provinces were sporadically reopened, safety rules kept the lucrative concession stands closed.
Senior executives took pay cuts and gave up bonuses. Cineplex worked out deals with landlords on the rent. The company received at least $50 million in government COVID subsidies. And expansion plans were put on hold for auxiliary offerings like Topgolf, a driving range and sports bar.
The picture is brighter now, as Jacob reports a return to nearly 80 percent of their volume by late spring. He’s optimistic summer receipts will prove even stronger. And he expects that Cineplex will receive a $1 billion payment from British company Cineworld after a 2020 buyout fell through, based on a Canadian court ruling last December. (Cineworld has appealed.)
Jacob’s industry peers think he’s done something right, because in April 2022 they presented him with the Marquee Award at the National Association of Theatre Owners (NATO) convention in Las Vegas—another sign of a business bouncing back. He can add the award to the Order of Canada he received in 2010, and the Order of Ontario honour of 2021.
As a philanthropist, Jacob is responsible for gifting a175-seat movie theatre for residents of the Baycrest Centre for Geriatric Care, where his mother Tryphosa lived until her death in 2010. (He also offers venues to the Toronto Jewish Film Festival.)
Moviegoing enters a new economy
What can’t be ignored is that April’s return to full-fledged moviegoing coincided with inflation coming to Canada at levels unseen in 20 years. And the result is more people having second thoughts about how to spend discretionary dollars.
But in his May 2022 interview with The CJN Daily, the Cineplex CEO said he wasn’t in a rush to raise prices.
“Look, our focus is bringing people back into the theatres,” said Jacob. “I don’t want to make it to a point where the pricing is something that attracts them away from coming to the movies. But we have to be careful because costs and wages are going up. The supply chain is a challenge.”
Cue public outrage in June, when the company announced a service charge of $1.50 on ticket sales through its website and app. Cineplex explained the money was to pay for improvements to its digital infrastructure.
But it’s also a signal that they’re buoyed by seeing customers queuing up at the box office again.
The convention held by NATO—not to be confused by the miltiary North American Treaty Organization—came at a symbolic time: Netflix announced it had lost nearly a quarter-million subscribers so far in 2022, with up to 2 million more cancellations expected.
Jacob has long been pushing back on the impact of streaming services, to the point of Cineplex forbidding Netflix and Amazon Prime premieres at the Toronto International Film Festival. The controversy stemmed from studios shifting away from theatrical exclusivity, as there used to be a window of up to three months before you could watch the movies at home.
Now he thinks it’s the right time for exhibitors to force weakened streamers to play ball.
“Getting them to get onside with the program, like we have for major studios,” he said in reference to Hollywood’s heritage players reverting to pre-pandemic traditions. “And I feel they’ve now realized they’ve got to use movie theatres to build their brand.”
Tom Cruise’s timely return
While his personal all-time favourite film is The Shawshank Redemption, released in 1994, Jacob was raving about the wildly successful Top Gun: Maverick, which he first got to see at CinemaCon. It’s gone on to become the highest-grossing release of the year.
“My wife was with me and she said, ‘I don’t think I want to watch this movie. I’ll stay for 20 minutes.’ Two hours later, she was still there.”
With his own 69th birthday on the horizon—yet with no plans to retire—Jacob has his eyes on strengthening Cineplex’s forays beyond movies. Canada now has 10 locations of The Rec Room (“Like a Dave & Busters on steroids”) and three Playdium gaming venues.
But he wouldn’t reveal how the CineClub subscription program is faring, nearly a year after it launched with a $9.99 monthly membership that includes one regular-priced ticket plus a discount on concessions.
Despite inflation, it’s the pricier tickets that sell the fastest at Cineplex these days, for a demographic that wants their seats to move, or to have water sprayed on them, or watch films in an auditorium with screens on three sides.
And the reluctance by patrons to put on high-tech 3-D glasses for hygienic reasons at the peak of the pandemic is a thing of the past.
“In the old days you saw a movie in 2-D. Now you can see them in 3-D, 4DX, D-Box, Ultra AVX, VIP, IMAX, ScreenX—there’s so many choices for the guests,” he said.
“You can’t replicate that at home.”