I would like to know how the business of movie screenings works
(showings prior to release done for promotional purposes).

Do theaters usually pay a fee for the movie rights to show, or do the
distributors/producers pay for the "promotion". How do they decide
(and who decides) where a movie will be screened prior to its release?
Is there a bidding process? Are there any special measures taken to
protect the film from copyright infringement? If a patron of a theater
is found to have ripped off (recorded) a film, who is held liable? Are
theaters given bounties or any other incentives to bust those that
bring cameras into a show?

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Clarification of Question by plusbryan-ga on 01 Aug 2006 10:12 PDT

Please include an average range that studios or theaters pay/get for screenings.

My expertise comes from being a "film buyer" for an independent
theater chain in a past life....

The studios get a percentage of the films gross. Depending on the
film, competion for the week and venue the film can go 80/20 split to
the studio on every dollar of the gross + 4 week commitment at that
location. Some films with competition (multiple blockbusters released
in the same week) might garner a 70/30 split with only one 2 week
commitment just to have the screens.

You will usually find the screening taking place one week before the
regular venue. This is a marketing plan to get the word of mouth buzz
going for a particular movie. Radio stations and colleges will usually
comp tickets to these screenings that are offered by the chain or
studio. It is the studio that makes these promotions happen.
The films are usually delivered early in the week before the screening
or regular play date in order for the theater to 'build' the print and
make sure there are no problems.
Theater Owners/Chains have various agreements for getting product
(films) Some competitive markets are open to bidding (higher splits
and longer playing commitments).
Some markets have sharing plans (I get the summer Disney picture - you
get the Disney Christmas picture). Some chains throw the weight of
their screens to get product (I promise 15 screens at 11 locations to
play your product vs I have two locations with one screen each to play
your movie - which theaters would you want 15 or 2)
Theater owners and Hollywood are really cracking down of piracy - to
the point where special encryptions are being placed on high profile
movies where studios know what theater a copy was made from. Yes,
theaters are also getting rewarded for nabbing these cheats.

Hope this helps you out.