Drafthouse Friends & Family,
The upgrades and changes to the Arlington Cinema & Drafthouse are progressing and we are preparing for the move to Arthouse and First Run movies. This week I'm addressing price increases for movies and planned theater upgrades. So far changes have been very positive - especially considering the effects of the crashing retail market which affects us too. Keep brick and mortar alive. :)
In addition to our regular updates as part of this series, I am also sadly making you aware of a negative situation with the Kennedy Center that is causing us serious harm. They have become a direct competitor that receives significant funding benefits from the Federal Government. Basically we are competing with the American Taxpayer. :( See details further down in this note.
Movie Programming
We have been working with our new movie booker to plan for our new programming style. As you may have seen, we have added new festivals, music films, and more. Starting a few weeks out, we will upgrade our status with the movie studios to "First Run". We will keep playing multiple films, family friendly films, and live comedy. A "First Run" status will get us quicker access to films. Our new movie booker has a deep background in Arthouse films as we are looking to play more of them at the prime time spots. Expect to see regular weekend options for films at the 7pm slot over the summer. Please keep an eye on our movie schedule over the next month or two as we evolve. We are both excited and a little nervous about the change.
Movie Price Increase
In order to obtain "First Run" status, we have to increase our ticket prices (in a few weeks). After speaking with all the studios, they have asked that our ticket pricing be market value and gave us guidelines on the range. $8 for matinees, students, and discounts. $10 for prime-time slots after 6pm. While this is a low price considering the average ticket prices in our area ($12 - $16), it is still a significant increase for our customers. By agreeing to the Studio's terms on pricing we will get access to films earlier than normal. We are doing this because the "Second Run" market has vanished - and we are struggling to compete with streaming at home released, before we get access to films. Families will see their matinee pricing on the weekend go from $6.50 to $8 (a $1.5 increase). We will also get access to Family films earlier than normal. Unfortunately, the biggest change will be for the discount movies on Monday and Tuesday. We will no longer be able to offer $2 films. Instead they will be $8 on Monday as our discount day and Tuesdays and the rest of the week will be $10. The transition will take some time as we figure out how long to keep films and which movies to try. We hope you enjoy participating in this experiment with us, as we sample a higher quality selection of films and earlier access to films.
Fixing the Marquee
Fixes to the Marquee have been problematic and expensive. The sign is proving to be very difficult to keep working, it's very temperamental. Fortunately, our electrician was able to find the some rare light bulbs and the sign is now fully functioning. We will keep an eye on the maintenance, but at some point in the future a full upgrade to the sign will be necessary.
The Green Room
The Green Room has officially been closed to make room for the new tenant who has agreed to move in. When they open we will send an announcement out.
New Menu
With the closure of the Green Room, we have freed up resources to support more changes and upgrades to the Drafthouse. We also are down to just one kitchen. This has required menu changes that allow us to operate more efficiently. After experimenting over two months, we have settled in on the new menu here [CLICK HERE FOR MENU]
General Maintenance
We continue to bring in new chairs, with more on the way. The next upgrades will be to chairs, the lobby, bathrooms, the bar, floor, and counters. We won't be able to do all at once, but will likely upgrade them in the order listed.
Competing with the Kennedy Center and the American Taxpayer
"Ask not what your Country can do for you, ask what your Country can steal from small businesses"
Having grown up in the DC area, we used to have such a fond impression of the Kennedy Center. Until the last few years, when the Kennedy Center has become a ruthless direct competitor. They have poached comics who annually perform in the comedy club or small comedy theater market in DC and rerouted them to the Kennedy Center - significantly overpaying the comics. In these cases they aren't offering increased DC area performances, but instead moving comics (and revenue) from one healthy private market to their publicly funded venue.
In our case, they have also denied us access to a performance troupe that has regularly performed at the Drafthouse for years - not because we wouldn't share, but because they want all the performances for themselves. They won't allow the performance troupe to work with us as they have done each year. Repeatedly we have found ourselves in disputes with the Kennedy Center over the last two years.
We are used to dealing with competitors - we have many in the DC market. However, the Kennedy Center leverages money and assets received by the Federal Government (US Taxpayer) to directly compete at the local level - damaging what used to be a local healthy marketplace. Having read previous reports to Congress, it is clear they are able to overpay for comics/performances, because the Federal Government pays for all building expenses, land, utilities, and facilities management. The US Taxpayer is giving an unfair advantage to the Kennedy Center to compete in the small comedy theater market.
The legal entity that operates theater performances in the Kennedy Center pays no rent or expenses related to the building (based on past congressional reports). It appears the legal entity is also charging rent to groups for the rights to use the facility and keeping that revenue for themselves. The smaller theaters in the DC area do not have the same advantages - particularly the private ones.
We would love for the Federal government to give us a room in the East Wing of the White House, pay all of our operating expenses related to the room - and allow us to produce shows and/or rent it and keep the proceeds.
We will be writing a more detailed letter (which we will share) where we ask Congress to charge the non-profit legal entity fair market rent, utilities and facilities management costs for using the Kennedy Center. We are asking this in order to level the playing field, now that the Kennedy Center has established itself as a commercial entertainment entity and local competitor.
For the Arlington Drafthouse, the damage is done. The Kennedy Center will cost us at least $150K in revenue this year as a direct result of their actions. Small dollars for the economic behemoth that is the Kennedy Center. However, for a small privately owned family business who gets zero government funding/assistance - it is a painful loss.
Below are a set of questions I have emailed to the Kennedy Center (which they have not responded to yet). I believe these questions will shine a light on the Kennedy Center's practices and quantify the benefits they receive from the Federal Government. Sorry, to bother you all with this drama, but we want to get the word out after dealing with this privately for 2 years and we want answers from the Kennedy Center. If you have some thoughts/ideas - please feel free to share.
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How much does the Federal Government pay for your facilities?
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How much rental income did you receive in the previous year?
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How much of that revenue was returned to the US treasury to reimburse the government for paying for facilities, utilities, insurance, and facilities management?
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Which companies donate to your comedy programming?
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Where can I find an online account of your latest budget?
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Where can I find a copy of your latest report to Congress?
