David Ross, left, and Kelly Rogers at the Capitol Cinema on Dominion Rd. Photo / Dean Purcell
As ‘Barbenheimer’ storms movie theatres, two of NZ’s most successful film industry businessmen are selling a share of their dream. Shayne Currie reports on an enduring partnership that’s included some of our best-known cinemas –
There’s never been any paperwork. No contract, no lawyers.
“Our relationship and joint venture have been 30 years on a handshake,” says Kelly Rogers, as he sits in his business partner David Ross’ office, sipping coffee. “It’s been brilliant, phenomenal and enduring.”
“We’ve never had a row … it’s almost boring,” says Ross, an accountant by trade, a movie buff by leisure, and one-half of the pair who built the Rialto cinema chain and film distribution business in New Zealand.
Rogers: “We just pick up the phone to each other and sit around the table in the old-fashioned way. If there’s an issue or you want to talk about something, you just talk about it – no emails, lawyers and all that stuff.”
Ross jumps up from his seat and steps to a set of drawers. “I do have one historical document,” he teases.
He pulls out a copy of the film industry magazine Moving Pictures International from 1996. Peering out of the pages, a picture of a youthful-looking Rogers and Ross, and a report of an early foray to Cannes.
Rogers, 60, and Ross, 82, are both film fanatics, a love that has seen their business partnership born and blossom through the various guises of Rialto.
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Their first Rialto cinema was built in Newmarket in April 1993, with three and soon five screens, before the pair extended the chain throughout New Zealand: Rialto Wellington in 1995 followed by Christchurch, Dunedin and Hamilton. They also had a screen in Palmerston North – something the Spanish women’s football team might have enjoyed in more recent times.
The name Rialto came from the historic Newmarket theatre which sat on the same site for many years, until the 1970s.
“We decided that Rialto had really good connotations,” says Ross.
They also pegged it to the setting in the Merchant of Venice. The Ponte di Rialto is a famous meeting place in the water-logged Italian city.
After selling out of the Rialto cinemas – the Auckland and Dunedin theatres remain under the brand but are now owned by Event Cinemas – Ross and Rogers built the Monterey cinemas in Howick, Upper Hutt and Takapuna.
Those three cinemas have also subsequently been sold, but the pair still own the Bridgeway Cinema in Takapuna, while Ross owns the Capitol on Auckland’s Dominion Rd.
The pair’s links with the Rialto brand endure with their biggest venture of all, the Rialto film distribution business, while Ross owns the Rialto Channel, on Sky.
The pair are now selling a share of that movie distribution business, seeking a partner – or partners – to help sustain and grow a library that currently includes more than 550 titles, with a total value estimated at more than $10 million.
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They have big dreams to build the businesses even more – partnerships that extend their territory beyond New Zealand and Australia, while Ross is also looking to expand the Rialto channel into a streaming service.
Rialto Distribution’s titles include Muru – announced last week as the highest-grossing Kiwi film of 2022 – and a range of other New Zealand titles such as Scarfies, Topp Twins: Untouchable Girls, Beyond the Edge and Mahana.
With film distribution now spread across more than half a dozen platforms – including cinema, pay TV, free-to-air TV, DVD, streaming, and on-demand – Rogers and Ross have built their fortunes on the back of some hugely significant deals.
With that success have been many highlights including Rogers – by his own estimate – having attended Cannes for 25 of the last 30 years, negotiating with film companies and schmoozing with the rich and famous. He’s bumped into the likes of Kevin Bacon at Sundance, and been mistaken for Bruce Willis in Cannes.
In an industry where relationships matter, Rialto established itself in the early days by buying films for around $5000-$10,000, proving its mettle and building its reputation and portfolio through careful handling of a movie’s marketing and distribution.
With hundreds of movies under their belt, one film, in particular, continues to stand out.
Rogers bought the rights to the original, 2009 Swedish version of The Girl with the Dragon Tattoo for $100,000, winning over the film agent thanks to Rialto’s earlier good work on another Swedish film, As it is in Heaven.
Dragon Tattoo made the pair rich.
“I saw big things for this film … but I didn’t realise how big it was going to be,” says Rogers.
“It did just under $2 million in its first week in Australia at the box office. And we grossed just under $20 million with the trilogy. It’s a career highlight – this film made us millions of dollars.
“Essentially you take about 40 per cent of the gross box office for our distribution company. You take off your costs to acquire the film and take off your release costs – you know, the advertising – and you’re left with the balance.”
From there, future revenue streams included other platforms – Dragon Tattoo is still the highest-grossing foreign language DVD of all time.
Like the rest of the entertainment industry, filmmaking and distribution have been severely disrupted in recent years, with a pandemic, union strikes and – most of all – the rise of streaming services and considerable upheaval of how we’re watching movies.
“It can be about the theatrical big screen experience,” says Rogers. “But people also want to see horror films, and animation and adventure and romance so it can also be about different revenue streams as well.
“Our company has the top independent film on premium video on demand this year in Australia and New Zealand. And do people know about this story? It’s called The Black Demon. It’s a shark movie. There’s a lot of content around like that for specific audiences.”
Ross says Rialto has strong relationships with the likes of Amazon and Netflix – the streaming services commit to a price for a film and spread it over three years as they determine when to best stream it.
“It’s more scientific and less risky now than it was back in those early days, where we were kind of rolling the dice,” says Ross.
“You can buy a film for $500,000 and sell it to Amazon for $1 million. So there’s the margin, but you have to cashflow it over about two years.”
Despite the rise of streaming services, the pair say New Zealanders’ love of attending the cinema also endures – a night out and escapism after the pandemic forced us inside for much of two years.
Despite some hefty pricing, especially at some of the bigger movie theatres, the box-office success of the likes of Barbie and Oppenheimer proves people are willing to pay for a good night out.
The men’s own love of films goes back to their respective childhoods.
Ross is a Francophile, and adores the Juliette Binoche Three Colours trilogy, Blue, White and Red.
He is a true arthouse fan, remembering a time when he lived in Paris, in a Garret flat, and venturing to a local cinema on a Sunday morning. “You wouldn’t even know what the film was.”
“But the film that I remember most was from when I was about 13 or 14 [in New Zealand]. The Wages of Fear, which was a French thriller. I was just so excited by it, and it still lives with you – it’s memories.”
He went from film fan to industry participant thanks to his father, Sir Lewis Ross, and his work as an accountant looking after Amalgamated Cinemas as one of his clients.
For a short time, David did the audit for the business. “That’s the first I knew about anything about film other than just going there. And I thought, that was fun.”
Meanwhile, Rogers, whose passion for films was sparked as a child making Super-8 movies, cites a broader and slightly more mainstream range as his favourites – Hitchcock and Spielberg titles as well as the likes of Grease, The Night of the Hunter, and Citizen Kane.
“There’s so many classics but more modern ones as well; Scorsese. I love those – that kind of auteur filmmaking in that world.”
Rogers opened the Bridgeway cinema in Takapuna in 1987: “That was the start of it all there.”
He and Ross value their film catalogue at around $10 million.
“We’re looking for equity finance to bring in for investors. We’ll look at anywhere from 20-30 per cent right up to a higher amount if it makes sense for us and other people,” says Ross.
One scenario, he says, might be two or three new investors. He sees it as almost a responsibility to bring in new, younger investors to help drive the business forward.
Rogers adds: “I’m incredibly excited about staying in as the CEO for Rialto Distribution. Equity investment is critical for our juncture right now, because we’re looking to expand the operation into selective international territories.”
As well as that, he sees opportunities with the likes of the US writers’ strike, and helping streaming services and TV companies fill any pending gaps in their schedules.
A similar scenario unfolded during Covid, he says, when Rialto distribution was the top independent company in Australia and New Zealand providing content to cinemas.
They have big plans for the Rialto Channel, too. “Eventually, we’ll have a streaming channel in New Zealand, as well as on Sky,” says Ross.
The streaming service won’t be as sophisticated as Netflix with its algorithmically driven platform. “Rialto is arthouse, it’s fairly easily defined and people understand it – they know what they are going to see.”
Meanwhile, fun is a common theme for the pair.
“My philosophy is I never get involved in anything unless there is what I call the fun element,” says Ross. “I have to trust the people I’m going in with because normally I’m in a minority situation. I trust people implicitly – if you get it wrong, you find an exit.”
Rogers: “Our relationship has been based on trust, hasn’t it, without anything written down for 30 years. We’ve made a lot of money together; we’ve had a hell of a lot of good times as well.”