“We have licensed a majority of the major operators out there, and those that aren't, terrific,” Laudicina says. “We want to encourage this use, we embrace it, and we just want to make sure that people are doing the right thing. Everybody needs to play from a level playing field.”

A Netflix representative says that the company does not have the legal rights to sell movies to people who will be sharing them with a larger audience, such as people in health clubs, universities and assisted-living centers. When asked if Netflix was OK with the idea of health clubs showing movies rented from Netflix to their members, Steve Swasey, vice president of corporate communications for Netflix, said that the company's terms of agreement clearly state that Netflix members are renting movies for personal enjoyment and not for commercial purposes. Swasey declined to comment further.

At one time, an agreement was in place between the MPLC and the International Health, Racquet and Sportsclub Association, but that agreement no longer exists, Laudicina says. Years ago, when VCRs were the norm, clubs had agreements with the MPLC specifically to show videos in their child care areas, adds Laudicina. Now the MPLC has agreements for child care areas, for general club use and for a room with a large screen, such as the Cardio Cinema in Gold's Gyms.

The annual MPLC fee for clubs is $235 for the child care area, $520 for general club use and $780 for the large screen premium. If clubs want to include the child care area in their general club use, the fee is $700 a year. A fee of $900 a year covers every area of the club (child care, general area and the room with a large screen). Fees can be reduced for clubs that have multiple locations, Laudicina says.

The penalties for breaking the law vary, from $750 for incidental exhibitions to anywhere from $30,000 to $150,000 for egregious violations, according to the Copyright Act.

“All we're doing is we're collecting the performance rights, and then paying the copyright holders,” Laudicina says. “We can carry a big stick, but we don't like to. We're not here to send cease-and-desist letters to people. We could, and we have, but that's the last thing we want to do.”

All of the clubs interviewed for this story say they have an agreement or a system in place that allows them to show movies in their clubs.

In addition to its 39 clubs, Retrofitness has 80 more in development, Casaburi says, and every one of them will have a RetroTheater in them.

“That amenity has garnered some membership interest,” Casaburi says. “Members are always intrigued by it. They're excited about it. There is a definitive correlation to some members saying, ‘This is a cool thing. I like this. This is one of the reasons I joined the club.’”

RELATED ARTICLES

• “Entertainment Gets Personal and Profitable,” http://fitnessbusinesspro.com/mag/fitness_entertainment_gets_personal/index.html

• “Clubs and Manufacturers Go Beyond Exertainment,” http://fitnessbusinesspro.com/forprofits/fitness_clubs_manufacturers_go/index.html

• “How to Design for the Optimal Cardio Experience,” http://fitnessbusinesspro.com/stepbystep/design/design-optimal-cardio-experience/index.html

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