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DAILY BRIEFING

DAILY BRIEFING

An industry shaken, and stirred

Written by Ralitsa Bobcheva, associate
Edited by Malcolm Robertson, founding partner
6 October 2020

Good morning,

I can still recall the first time my father took me to the cinema. It was one of two small independent picture houses in my hometown in Bulgaria, where Pirates of the Caribbean shared the bill with a few less well-known titles for more niche audiences.
 
Needless to say, those cinemas did not survive the advent of blockbuster movies and the industry again faces existential threats. 
 
The film industry’s increasing dependence on blockbusters was brought into sharp focus this week by Cineworld. Yesterday, the cinema chain announced its decision to shut down 663 of its venues worldwide – 127 of which are in the UK – after MGM Studios postponed (for a second time) the release of the new James Bond movie No Time To Die, to April 2021. 
 
The delay to what might be Daniel Craig’s swansong as 007 seems to be a tipping point for a company struggling through the health crisis and facing fierce competition from online streaming services. 
 
Cineworld has also missed out on the latest Marvel film Black Widow and Universal’s latest in the Fast & Furiousfranchise. Disney’s decision to bypass cinemas altogether – streaming the new Mulan film direct to consumers – suggests the pandemic is only one twist in a more complex plot. Changing customer behaviour has seen Netflix add 25.9million subscribers in the first six months of this year, accelerating a trend that most would argue was happening regardless of the pandemic. 
 
And while this shift in customer sentiment towards the ease of online streaming may right now deprive cinemas of their role as blockbuster gatekeepers, there is evidence in history to suggest the big screen may yet be revived. In the 1950s, cinemas faced similar challenge from the television and direct broadcasting. Somehow, the film industry survived and thrived by evolving and adapting its distribution model.
 
One wonders how the cinema industry will adapt to what is happening now. Could the gradual erosion of the symbiotic relationship between cinema operators and big film studio chains create space for a richer variety of deals andpotentially more diverse titles – in terms of style, content and form – driven by an industry required to innovate to survive? In 1967, Sean Connery starred in You Only Live Twice. For the cinema business, that may yet turn out to be untrue.

News

Overnight, US President Donald Trump has used Twitter to tell the world (from the White House) that he’s “learned so much about coronavirus” from his hospital bed – most significantly that “we’re going to beat it” and that it should not take over our lives. There are still several open questions around the seriousness of Mr Trump’s illness after a weekend of conflicting statements.
 
Sainsbury’s, Lidl, Morrisons and B&M homeware stores were issued with warning notices by Barking and Dagenham council leaders in east London after their staff failed to enforce mask-wearing and social distancing by customers. In response, the retailers have complained to the Department for Business, Enterprise and Industrial Strategy.
 
At least 120 people have been injured in clashes between demonstrators and police in Bishkek over disputed parliamentary poll in Kyrgyzstan. The clashes took place after demonstrators broke into a parliamentary complex and security headquarters in the capital, amid widespread claims of vote-buying. 

Business and economy

Following Cineworld’s announcement that it will shut down 127 of its cinemas across the UK, workers on zero-hours contracts across the country could be left without pay. While the cinema operator has so far refused to say how many of its staff are on zero-hour contracts, Cineworld employees have claimed that the majority of workers at the average Cineworld site are employed on zero-hour terms.
 
The chair of the Scottish National Investment Bank, Willie Watt, has told the Financial Times that the institution will formally launch before December. The bank aims to provide long-term capital to projects that align with the Scottish Government’s-goals to cut carbon emissions, reduce inequality and address demographic change. (£)
 
During his keynote speech to the Conservatives’ annual conference on Monday, Chancellor Rishi Sunak has confirmed his commitment to bringing public borrowing and state debt under control in the medium term. His address will likely be interpreted as an implicit acknowledgment of the scale of the cost of state intervention to cushion the impact of the pandemic. (£)

Columns of note

Writing in the Financial TimesAngus Deaton casts light on a striking discrepancy: the list of the world’s wealthiest countries hardly matches the list of countries where people enjoy the highest material wellbeing. This serves as a reminder that with the ownership of resources confined to the few, rich resource-based countries are often inherently unequal. (£)
 
In the GuardianZoe Williams compares US president Donald Trump’s recent Covid-19 diagnosis to Boris Johnson’s contraction of the virus months ago. What happens to the confidence of strongman politicians when they end up in hospital? Johnson’s own trajectory indicates the prime minister’s previous ability to project confidence has faltered, Williams argues.

Cartoon source: The New Yorker

Markets

What happened yesterday?

At the close, London stocks finished higher, following positive updates on U.S. President Donald Trump’s health. The FTSE 100 ended the day up 0.69% at 5,942.94, and the FTSE 250 was ahead 1.08% at 17,583.09. The pound was up 0.33% against the dollar to $1.2978 but fell 0.31% on the euro to €1.1008. 
 
Likewise, Wall Street’s three main indices closed on positive ground on Monday, with the Dow Jones Industrial Average climbing 465.83 points, or 1.68%, to 28,148.64, the S&P 500 rising 60.16 points, or 1.80%, to 3,408.6 and the Nasdaq Composite going up 257.47 points, or 2.32%, to 11,332.49.
 
In company news:

Crowdfunding platform Crowdcube will acquire all the outstanding share capital of Seedrs in a merger that will create one of the world’s biggest private equity marketplaces.
 
French fashion brand Chanel has reportedly bought its boutique store on Bond Street for £310m, in a move that shows confidence for the central London commercial property market.
 
Lenders to Cineworld Group have called in advisers on the company’s £6.2bn debt as the chain announced the closure of 663 cinemas on both sides of the Atlantic.
 
US pharmaceuticals giant Bristol-Myers Squibb has announced plans to acquire California drugmaker MyoKardia for £10.1bn. 

What’s happening today?

Finals
Smartspace     
YouGov

Interims
Harworth Gp   
Inspiration Hlt

AGMs
Cake Box Holdi.

UK economic announcements
(00:01) Retail Sales
(09:30) PMI Construction

Int. economic announcements
(07:00) Factory Orders (GER)
(13:30) Balance of Trade (US)

Source: Financial Times

did you know

Like fingerprints, everyone’s tongue print is unique. Source: @qikipedia

Parliamentary highlights

House of Commons

Oral questions
Health and Social Care (including Topical Questions)
 
Ten Minute Rule Motion
Marriage and Civil Partnership (Minimum Age) – Mrs Pauline Latham
 
Consideration of Lords amendments
Prisoners (Disclosure of Information about Victims) Bill
 
Legislation
Private International Law (Implementation of Agreements) Bill [Lords]: Consideration in Committee and Remaining Stages
 
Motion
Health Protection (Coronavirus, Restrictions) (No. 2) (England) (Amendment) (No.4) Regulations 2020 – Priti Patel
 
Adjournment
Future of Shotley Bridge Community hospital – Mr Richard Holden

House of Lords 

Introduction(s)
Lord Sikka and Lord Field of Birkenhead
 
Oral questions
Various
 
Orders and regulations
Various

Scottish Parliament 

Time for Reflection: Pastor Peter Anderson, Destiny Church, Edinburgh
 
Parliamentary Bureau Motions
 
Ministerial Statement: Delayed UK Budget: Implications for Scottish Budget
 
Topical Questions (if selected)
 
Ministerial Statement: Assessment of SQA National Qualifications in 2020-21
 
Ministerial Statement: Report on Coronavirus Legislation
 
Scottish Government Debate: COVID-19: Review of Scottish Government’s Approach to 
 
International Development
 
Committee Announcements
 
Business Motions
 
Parliamentary Bureau Motions
 
Decision Time
 
Members’ Business — S5M-22771 Shona Robison: Changing Miscarriage Care

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