Sony Acquires Alamo Drafthouse Cinemas as Old-School Vertical Integration Looms

The Paramount Consent Decrees, which were created in response to the landmark 1948 antitrust case United States v. Paramount Pictures, Inc., were finally and fully overturned in 2022, after a two-year sunset period. Major studios were timid to make a move following this, but finally, Sony Pictures Entertainment has taken the plunge: Sony has made the first pivot back toward the pre-1948 studio system of total control by acquiring Alamo Drafthouse Cinema.

This isn’t the first blow against antitrust rulings. In 2019, Netflix, then a burgeoning big-money behemoth, acquired the historic Paris Theater in Manhattan, playing its own first-run releases alongside regular programming. 

Technically, this was all kosher. The Paramount Consent Decrees mandated that major film studios were legally prohibited from owning movie theaters. This included the original Big Five majors: Paramount, Warner Bros., RKO, MGM, and 20th Century Fox. Netflix, as a streamer, had free rein.

This—along with Netflix’s acquisition of Grauman’s Egyptian Theatre in 2020—should have been seen as a harbinger of what was bound to come within the theatrical exhibition business. The Egyptian’s reopening in November 2023 coincided with the streamer’s awards run, allowing Netflix and the American Cinematheque to program its own awards contenders: David Fincher’s The Killer, Bradley Cooper’s Maestro and Wes Anderson’s short The Wonderful Story of Henry Sugar.

There’s a central quandary in regards to the situation here. Long-running theaters have reopened following much-needed upgrades: Netflix helped the Paris Theater institute a new Dolby Atmos system and the technology needed to project 70mm film, which the theater hadn’t displayed for over 15 years. However, the purchase of theaters by film studios also necessitates a worry that these cinemas will essentially operate as PR for these mammoth companies and their releases. Larger studios are already immensely demanding when it comes to urging theater chains to play their films; this only further trends towards drowning out independent releases from movie houses.

The formerly indie-skewing theater chain, with 35 locations across the country, will continue to be run by CEO Michael Kustermann, and the Alamo-owned Fantastic Fest—a film festival based in Austin focusing on genre cinema—is also included under the acquisition, according to The Hollywood Reporter.

This purchase is posed to be a potentially large turning point in the history of film. On one hand, Alamo filed for bankruptcy in 2021; on the other, an independent exhibitor and independent film festival being owned and operated by a major studio intimates grave questions about the maintenance of the theater’s indie ethos. Will regular Terror Tuesdays and routine, specialized film series be replaced by additional runs of Sony releases? We don’t know yet, but the capsizing of antitrust laws suggests a litany of other troubling questions to come.

Hafsah Abbasi is a film critic who has covered the Sundance Film Festival and the Mill Valley Film Festival in years past. She currently resides in Berkeley, California. Find her latest writing at https://twitter.com/hafs_uh.