In a recent interview with Maeil Business Newspaper, Ray Seok, founder and CEO of RNR Inc., discussed the business opportunities discovered in the rapidly changing entertainment market due to the emergence of over-the-top (OTT) media platforms like Netflix and the impact of the pandemic. Seok explained how RNR is transforming the traditional movie screening business into a digital format, opening up new and untapped markets.

RNR, a Korean startup founded by Seok, provides a bespoke cinema solution called MONOPLEX and a digital platform Cine Marketplace (CMP) 2.0, which leverages online movie ticket bookings and content intellectual property (IP). Seok, who is a former employee of CJ CGV, Korea’s biggest cinema chain, believes that the conventional multiplex business, with its excessive investment in physical assets, is not sustainable. Instead, RNR’s MONOPLEX offers a cost-effective solution by creating small theaters in underutilized spaces, and it currently operates 10 MONOPLEX theaters across the nation.

“Theaters are a heavy investment and operating expense industry, and each additional theater requires excessive capital and fixed costs. As a result, the winners in the theater industry are real estate owners who have nothing to do with content,” Seok said.

The company aims to transform the theater business into a digital distribution network, similar to Airbnb’s operation in the hotel industry without building hotels. RNR adopts a franchise-based content distribution network model, providing screening solutions without initial costs and receiving a 10-20 percent content distribution fee. RNR is also seeking its presence in the U.S. by partnering with major U.S. hotel chains and real estate companies.

In addition to MONOPLEX, RNR operates a digital content trading platform that facilitates online screening contracts and IP transactions. Traditionally, movies follow a value chain of production, distribution, and then screening, but after the initial theater release, movies (IP) are resold through other channels at lower prices, posing challenges for distributors and theaters in terms of long-term IP utilization. RNR aims to integrate the fragmented film industry, including production, distribution, screening, and IP licensing, into a single digital platform, addressing issues such as identifying rights holders and establishing a systematized distribution system and online tools for global copyright transactions.

RNR emphasizes the importance of building a fandom ecosystem around theaters and aims to provide an engaging and immersive experience for moviegoers beyond simple ticket booking services.

“Traditional theaters are the most powerful window for content distribution, generating 50 trillion won ($37.38 billion) a year in revenue, yet they are completely disconnected from both the front and back-end of the industry, and despite having tens of millions of membership customers who go to theaters, they are unable to build a fandom ecosystem, only providing simple services like seat reservations,” he said.

By integrating various aspects of the film industry into their platform, such as production, distribution, screening, and IP licensing, RNR envisions a comprehensive and interconnected ecosystem that benefits all stakeholders involved.

RNR’s initial success can be attributed to its innovative approach to the cinema industry and its ability to adapt to the changing landscape. By identifying opportunities presented by OTT platforms and the challenges faced by traditional theaters, RNR has positioned itself as a key player in the digital transformation of the cinema industry. With its MONOPLEX solution and CMP 2.0 platform, RNR offers a unique value proposition to both venue owners and content creators, enabling venue owners to transform underutilized spaces into small theaters and content creators to reach a wider audience and maximize IP utilization. As RNR continues to expand its operations internationally and establish partnerships with major players in the hospitality and real estate sectors, the company’s influence in the cinema industry is expected to grow, paving the way for a more dynamic and sustainable future for the industry.

[ⓒ Pulse by Maeil Business Newspaper & mk.co.kr, All rights reserved]