Hey, Bob Cooney here. I wanna talk to you about something you may or may not know about. It’s called IMAX VR.
Back in 2016, when VR arcades were just starting to pop up in America, movie theaters began experimenting with virtual reality. They started building these VR “theaters” and arcades right in their lobbies. At the time, a lot of startups were running around saying they wanted to be the “IMAX of VR.”
And Richard Gelfond, the CEO of IMAX, basically said, “Well, why can’t we be the IMAX of VR?” So IMAX decided to invest. They built VR centers—some inside AMC multiplexes. They even put up a flagship in LA in La Brea, right by the tar pits. (I’m sure there’s a funny metaphor there, somewhere.)
I got invited to a pre-opening tour in January of 2017. And, look, it’s always easy to say in hindsight, “I knew it wasn’t gonna work.” But honestly, I knew it wasn’t gonna work.
IMAX is about immersive storytelling.
In the 70s, it started out in museums, showing documentaries. That was basically the first mainstream form of what people now call “edutainment” (and yeah, I hate that word, but whatever). For the first 30 years, IMAX was all documentaries.
Then in 2002, they remastered and released Ron Howard’s Apollo 13 in IMAX, twenty years after the original came out. That kind of made sense—it was a big hit, based on a historical event. Kind of like a documentary but with a bigger budget, big stars, and one of the greatest directors of all time. Oh, and they’re re-releasing it on Sept 19th for it’s 30th anniversary.
The next year, 2003, Matrix Revolutions became the first film to release day-and-date in IMAX and regular theaters. And then, for the next seven years, there was a slow build: documentaries mixed with re-releases and some new Hollywood films in IMAX.
Then came 2010—and IMAX exploded.
Check out this slate: Avatar, Iron Man 2, Toy Story 3, Shrek Forever After, Inception, and the first Harry Potter film—all in one year. Sixteen major Hollywood films were released in IMAX in 2010. That was the year IMAX fully transitioned from a documentary format to mainstream immersive storytelling.
Fast forward to 2024: there were 98 films released in IMAX last year. Ninety-eight! That includes documentaries and some China-only releases, but still. IMAX has become the global standard. The Kleenex of immersive movies, though you’ll rarely need tissues at a film showing on IMAX. Unless you weep at the scene of shit blowing up.
Now here’s the thing: IMAX VR wasn’t about movies. It wasn’t about storytelling. It was about games.
Back in 2017, there really weren’t VR “movies.” There were some short 360-degree videos, but let’s be honest—most of them sucked. So what IMAX actually did was a brand extension into immersive gaming. But gaming had (and still has) a really tricky business model in location-based entertainment. Expensive labor, tough economics, and it didn’t attract IMAX’s core movie-going audience.
So, yeah. IMAX VR was a failed brand extension into a flawed business model. Plain and simple.
Here’s the exciting part. Today, a very different VR format is working: large-scale free-roam storytelling.
Think about it like IMAX in the early days—when it was mostly documentaries. That’s where VR storytelling is now.
The best example is Horizons of Khufu from Excurio. Everybody points to it as the first real blockbuster in location-based VR storytelling. It’s done over $25 million in ticket sales in the last three years. They call it an “immersive expedition,” which is basically a documentary you can walk through.
Their latest project takes you to Carcassonne, France, in 1304 to experience the Golden Age—I’m pretty sure you get to fire a trebuchet. It’s the ultimate in immersion, you feel like you are there. That’s what VR can do that a theater screen never could.
Univrse, out of Barcelona, is teaming up with Banijay—the biggest production company you’ve never heard of and the one behind Black Mirror. Together they’re making a large-scale free-roam Black Mirror epic experience set to launch late this year. If you don’t know the show, it’s biting satire about our relentless pursuit of technology at the expense of our humanity. To me, that’s edutainment at its best. And this project could be the tipping point from “documentary-style” VR into mainstream narrative VR.
Wevr—the studio that worked with Jon Favreau on Gnomes & Goblins and did the Harry Potter VR with Dreamscape and Warner Bros. has two titles under development that cross over between education and mainstream storytelling. They have the talent to create AAA content and the deep studio connections to do something big.
And there are other studios quietly working on similar stuff that I can’t talk about, but a slate is forming.
Two big shifts happened since the IMAX VR days. The keys to profit in LBVR is revenue per square foot and labor cost as a percentage of revenue. (And customer acquisition cost, but that’s a different beast.)
It’s been well documented that movie theater attendance has been sliding for 20 years. Ticket prices have escalated to make up for the drop in attendance. Luxury seating, dine-in theaters, 4DX, and premium large formats are keeping the revenue up, but how far can they push that? I’ve polled some of the operators of mid-sized theater chains, and they tell me about 17% of their auditoriums underperform and could easily be repurposed. IF they had something new to put in.
Multiply that across the U.S. and you’re looking at 5,000 auditoriums looking for something new. And what does a conversion cost? Rip out the risers and level the floor. At first, I thought, pouring concrete?!? Yikes, that would be a barrier. But the ones I spoke to were pretty nonchalant about it.
There are some solid proof points:
If you take a 2,500-square-foot auditorium and turn it into a high-throughput VR walkthrough experience with a great story, the revenue jump could be 10x what that same room is making today on traditional movies.Come check out the latest examples of free-roam VR storytelling content in Barcelona this month. Get tix NOW and they’re almost gone. Or email me for special VIP access to some of the secret squirrel stuff.
Here’s the catch. We need a solid slate to convince theater owners to invest in the conversion. Black Mirror. Titanic. Wevr’s new titles. Some other secret squirrel stuff. There’s at least a half-dozen new titles coming in the next 12-months for different audiences at different times of day. And with a title only playing in one theater in a city, it should have more legs than today’s movies, which are often gone and on streaming services within weeks of release.
One of the challenges is that these studios work in isolation. They don’t share, they don’t plan together. I might be one of the few people that sees the bigger picture of what’s coming down the pike.
That’s part of why I started the Location-Based Entertainment XR Association (LEXRA). To get the studios, platforms, and operators on the same page of the script. Right now any one studio can only pitch an experience, or maybe two. But as an industry working together we can pitch a year-long slate, and a model for conversion that actually makes money.
If you’re in theatrical exhibition and you’ve got underperforming auditoriums (you know who you are), or if you’re an operator open to committing a couple thousand square feet, let’s talk. If you’re a game studio looking for opportunities beyond the challenging home VR market, look into large-scale free roam. The numbers might surprise you. And if you’re already in this space but need go-to-market help—well, that’s my jam.
You can find me at bobcooney.com, on LinkedIn, or through LEXRA.org.
Audiences are hungry for immersive stories. The format is finally ready. Let’s build it.
