Phone home? Forget it. “E.T.” director Steven Spielberg is phoning out-of-home with his virtual reality startup Dreamscape, which just announced that it has raised another $20 million in a Series B round led by AMC, the nation’s biggest movie chain.
Importantly for both Dreamscape and AMC, under the deal, the startup will install VR “stations” in six AMC facilities, a test of the potential for out-of-home VR to attract a new set of audiences to one of the oldest of mass media, the movie theater.
The film exhibition business, while still an $11 billion industry in the United States, hasn’t seen growth in ticket sales for years. It’s been even worse in 2017, after a dismal summer yielded few blockbusters and sent exhibitor stocks tumbling. Only the historic September success of horror hit “It” has revived the box office enough to leave it just 4.5 percent below last year’s numbers so far.
So the deal with Dreamscape makes a lot of sense for AMC as it searches for ways to bring back young audiences and more intensively exploit its underutilized real estate. Out-of-home experiences such as Dreamscape’s planned offerings could be a way forward for theaters, if they can overcome some potential downsides.
The Dreamscape offerings tick a lot of key boxes, at least based on what I heard during discussions at the recent Future of Immersive Leisure conference in Las Vegas:
- Social. Up to six players at a time will be able to simultaneous participate. Bring your friends, play together and have something to talk about later.
- Free roam. Groups will be able to move around within 16-foot by 16-foot spaces.
- Regularly updated. The model calls for Dreamscape to regularly create new experiences, at production costs of around $1 million.
- Reasonably priced. The 10-minute experiences are expected to cost between $15 and $20 per person.
- Using “4DFX.” Theme-park rides have long had a “fourth dimension,” using fans, water spray, temperature changes and gimbals or other physical movement tools to create a more realistic ride. The Dreamscape experiences will incorporate wind, smells and motion-sensing trackers.
Beyond Spielberg, who has long been involved in the video game business and other entertainment platforms beyond film and TV, the Dreamscape team of creators is an impressive one. It includes Gore Verbinski (“Pirates of the Caribbean” series), Oscar-winning film-music composer Hans Zimmer (Verbinski’s films plus Christopher Nolan’s, such as “Dunkirk,” “Inception,” “The Dark Knight”), and a batch of former Disney Imagineers.
Attendees at the FOIL conference made it clear that we’re probably a few years off from enough market scale and tech improvements to make in-home experiences profitable for creators and enjoyable for audiences.
In the meantime, out-of-home represents a way to reach big audiences with immersive experiences for reasonable prices. It also promises to be a way to drive audience interest in the potential for better in-home experiences as they come along.
Think of this deal as something like the Formula 1 race cars whose high-end technologies eventually translate into the four-door sedan sitting in your driveway. Now we’ll see if Spielberg and Dreamscape can drive some profits to the theaters.