“This industry is corrupt,” Lisa Milne, owner of The Royal Theatre in Trail, B.C. (population 7,920), told me, referring to the film exhibition industry in Canada, before I’d even been able to start recording our interview. She was, seemingly, dying to say it.

“The studios don’t listen to us,” she continued. “In the 15 years I’ve been doing this, I’ve had many conversations with [the studios] as high up as I can go, and they basically say, ‘Well, Lisa, that’s the way it is.’ There’s no reason why. There’s no discussion about doing anything different.”

Independent movie theatres in Canada are struggling. It may seem like common sense given streaming convenience, but the problems go much deeper than competition from Netflix. It’s in the frustrating DNA of Canada’s unique, and uniquely constricting, film exhibition ecosystem.

In March, the Network of Independent Canadian Exhibitors (NICE), a new alliance of cinemas, festivals, programmers, and other advocates, released a stunning report on the state of film exhibition in the country. After surveying 67 NICE members across Canada, the report concluded that about 60 percent were operating at a loss at the end of their most recent fiscal year. At a moment when roughly 34 percent of the report’s respondents say their theatre is the only cultural option in their community, the threat of closures is stark. But the story runs deeper: from the domination of Cineplex to changing audience habits, small theatres across Canada are struggling to survive.

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Theatres book studios’ films through distributors, and bookers at those distributors let theatres know if the films are available. It’s at this stage that troubles for indie theatres can start. For owners like Milne, particularly those whose theatres have just a single screen, studio mandates called clean runs present serious problems. This means a theatre must dedicate their screen to only one film, to the exclusion of all others, every single showtime. For a large multiplex with 10 or more screens, dedicating a screen to a single film is no big deal. Theatres with one screen, though, “can’t serve their community the way that they would like to,” says NICE secretary Sonya William.

A recent example, Deadpool & Wolverine, took the problem to new heights for Milne. She says Disney demanded, as is typical, an exclusive run for three weeks, followed by a fourth week that would be determined according to metrics unknown to Milne but communicated via her booker—if it did “well enough,” she would be forced to show it another week. “Not only do they not tell you what [well enough] is, they block you from booking a movie on that held fourth week,” she says.

In a new twist, however, her booker told her that the same would now hold true for a fifth week. Essentially, Disney demanded all future weeks be held for them “until they determine if their film comes off my screen,” Milne says. “I’ve never had this happen.”

While it’s intensified lately, this is a long-standing practice that not only hurts single-screen cinemas, but, as William put it, Canadian culture as a whole, including opportunities for domestic artists. “If a cinema has to show the same film over and over and over again, most likely not a Canadian film, that means there’s not a single showtime that can go to this local filmmaker with a smaller title,” she says. These may not sell as many tickets, but would nevertheless bring out an audience and be able to build recognition and growth.

The other major obstacle for smaller theatres is zoning. In practical terms, Cineplex instructs distributors not to send films to nearby independent theatres until Cineplex is done showing them. Even if the closest Cineplex is several kilometres away, a small theatre may still be considered to be within a Cineplex zone. As a result, local independent theatres can’t show new releases until months later. What may seem like bad programming is, in fact, due to zoning policies, sometimes called the radius clause, that lack transparency but are nevertheless aggressively enforced. It’s not clear how far the radius extends. These are unwritten rules about unseen and always-shifting zone maps that get unilaterally imposed on these theatres by Cineplex and by distributors. The rules can change at any time, and theatre owners don’t have paper trails. Several small theatre owners who spoke to This Magazine drew attention to this problem, and so did NICE.

Cineplex’s role in Canada is, without a doubt, a monopoly. It runs 158 theatres with over 1,630 screens, and it controls approximately 75 percent of domestic box office. By contrast, no one company in the U.S., the UK, or Australia controls more than 30 percent, and they have all had organizations like NICE for many years. William says the length of time it took for NICE to be created signifies just how tough the Canadian indie film scene is. It began in a grassroots way in 2018 via an online discussion board, and the group intensified their efforts during the beginning of the COVID-19 pandemic. Once they started seriously organizing in 2020, though, Cineplex was squarely in their crosshairs, and zoning is a key reason—even though it’s no longer necessary.

Zones originated with the production of 35 millimetre film prints, which were expensive and resource-heavy, and were introduced as a way to control production and maintain competition between cinemas within a geographic region. Two things have happened: digital prints negate most of the practical challenges, and Cineplex came to completely dominate the theatrical landscape, which, William told me, “really means that the competition originally suggested with the zoning rule is now gone.” Kiana Reeves, manager at The Vic Theatre in Victoria, B.C., says that because of the radius clause, they would never know week-to-week what they’d be able to show. The uncertainty can cause distrust from customers, who are left unsure of what the theatre can or will offer. Instead, it’s always promising an amorphous “coming soon.” As a result, she says, “by the time we do get it, it might be six weeks later, and everyone that meant to see it already has.”

Fatima Allie Dobrowolski, owner of the Plaza Theatre in Calgary, has the same problem. To the confusion of many at the time, she purchased the Plaza in 2021 during lockdowns, after scrolling on Instagram while in London, England and seeing it was for sale. She became determined to make sure the space would continue to exist as intended, confident that theatres would reopen and thrive again. One first step, after admitting to some naïveté, was confronting the radius clause. She built a cafe in the theatre, so the establishment doesn’t have to rely on selling tickets. While the Plaza does have many loyal customers who prefer to watch movies in the historic and newly renovated space, it still bewilders Dobrowolski “why there isn’t room for Cineplex and this little independent with one screen to also show [a film].”

Dobrowolski’s sentiment is widespread. “You’re not going to find anyone who works on this level of cinema who has much of a kind word to say about how we are all waiting in line behind them and how we’re treated as a result,” Scott Hamilton, programmer at The Broadway Theatre in Saskatoon, says. Many referred to Cineplex as a “bully,” strong-arming audiences and smaller theatres alike just because they can. In early 2023, an episode of Canadaland “Commons” featured an executive from a movie distribution company who commented anonymously about how Cineplex exerts its power, stating, “because of Cineplex’s enormous market share, no independent film distribution company can afford to do anything that Cineplex might perceive as going against its interests” out of fear that Cineplex would decide to simply stop screening that distributor’s films, a risk these companies cannot take.

Cineplex refused This Magazine’s request for an interview, and did not speak to the zoning or exclusivity policies. In a statement to This Magazine, Cineplex’s vice president of communications Michelle Saba said: “Cineplex does not own the rights to the movies that appear on our screens – we license them from distributors to play in our theatres. It is up to film distributors to decide where they play their films.” According to NICE and theatre owners, this is the company’s typical line of defence: putting blame on the distributors, while obfuscating the reality that the company’s market dominance essentially means that the distributors have no choice but to play by their rules.

Some theatres have resolved to work around the issue by almost entirely avoiding new releases. Hamilton told me about their chaotic programming, as the space also regularly hosts music and other events, which means “I am never able to offer an entire week’s run unbroken to any title no matter what the title is.” Instead, they show all kinds of older or repertory films, and the diversity of options seems to be working. “Our film numbers are actually going up,” he says, “and we’re doing that with less screening time, and that’s from more dynamic programming.” This means selecting unexpected films and turning them into an event worth leaving the house for—just one way small theatres are getting creative to try to survive.

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It’s Friday night, and you want to relax after a tough week with a movie—are you going to the theatre, or staying in the comfort of your own living room? Debates about theatres have tended to centre on the threat posed by streaming. Surprisingly, every theatre owner I spoke to says this is hardly their main concern, and a problem somewhat straightforwardly answered through better programming.

For Hamilton, even keeping his loyal audience coming back is a challenge. Like others, he’s doing this by eventizing screenings like never before—coming up with added value to turn the movie into an event, as in the case of always-raucous The Rocky Horror Picture Show screenings. Other strategies programmers use include inviting filmmakers, creating a specialty cocktail inspired by the film, or in a recent example to accompany a screening of Napoleon Dynamite, selling fresh tater tots.

Corinne Lea, owner of the Rio Theatre in Vancouver, acknowledges that at the very least, “the one byproduct that’s been good is that Cineplex has kind of forced us to be really creative.”

Eventizing, alongside expanding how we think of theatre spaces, has come naturally to some and less so to others. “We’re a very busy rental hall: weddings, live events, we’ve done wakes,” Hamilton says. “Other people are [becoming] multi-use venues by way of trying to stay open, and we were doing this before we had to.” That scrappiness and community spirit is a common characteristic, though. “It’s the volunteers and the patrons who come through when we need them,” Reeves says about the Vic diehards, “helping me paint, giving us supplies. They feel a real ownership over the space.”

Still, it’s a struggle to make ends meet. So what’s the solution? NICE and theatre owners have advocated for increases in public funding for small theatres. But even this would be welcome if insufficient, many theatre owners say, a short term band-aid for a long-term problem. Instead, they argued, governments must get more aggressive. “The government is the one that needs to stop Cineplex,” Lea says. “You can’t expect a for-profit monopoly to police themselves; you need government regulations in place.”

Unfortunately, the government thus far seems unwilling. Lea says the Rio went to the Competition Bureau, who told her they “don’t see an issue here,” in her words, and dismissed the case. In a statement, Sarah Brown, the Bureau’s senior communications advisor, says: “As the Bureau is obligated by law to conduct its work confidentially, it would be inappropriate to comment on specific issues in the marketplace. I am also unable confirm [sic] whether or not we are or will be investigating this matter or to speculate whether the conduct you described contravenes the Competition Act.”

William points out that the impact of this apparent governmental passivity is especially harsh for rural communities, whose theatres are nevertheless beholden to the same rules as those in cities. “What really breaks my heart,” she says, “is we will probably see closures the most in the rural area cinemas and the communities who really need these places”— not only to see movies, but as multi-use community spaces and cultural hubs. Not having the ability to compete means indie theatres may start disappearing at an alarming rate, leaving cultural gaps in the places they used to call home.

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Smaller theatres, of course, will keep up the pressure, with a commitment to meet the moment. While the specifics vary somewhat according to region (Benjamin Pelletier, programmer at Cinéma Moderne in Montreal, laments that few distributors in North America provide French subtitles, limiting their offerings, while B.C. theatres have been battling for fewer restrictions on serving liquor), there is consensus that things must evolve. “I have to feel like we’re doing something that’s helping grow the community,” Hamilton says, “or else I wouldn’t be interested in doing this. It’s too much stress.”

“Imagine there’s no independent theatres left, and there’s only the monopolies, what does that look like? How is that going to change film?” Lea asks, noting how industrial norms impact the medium itself. Milne, the Royal owner, puts it even more bluntly. “What hurts me as a human and as a business is not being able to cater to everybody in my community, how I know that they deserve to be catered to,” she says. “We need help fixing this broken system.”