posted 11-03-2019 09:32 AM                    

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Netflix was the only company willing to take a risk on the project — a film that moves at a measured pace in its three and a half hours as it tells a tale of how organized crime was intertwined with the labor movement and government in the United States across the last century.

Netflix has little time for the old theatrical business model. It is devoted to keeping its subscribers happy, meaning that most of its movies make their debuts on the streaming service itself. Last year, Netflix tiptoed into the theaters, offering Alfonso Cuarón’s “Roma,” which went on to win three Oscars, a 21-day exclusive release at independent and small-chain theaters before it started streaming. The film eventually played on roughly 1,100 screens around the world, roughly 250 of them in the United States.

“The Irishman” will move on to more theaters domestically and internationally after its initial expansion on Nov. 8, but its run will fall far short of a major release. Two films that came out last month, “Joker” and “The Addams Family,” have each played on more than 4,000 screens in the United States.

For Mr. Scorsese, Netflix tried to work out something more robust than the 21-day exclusive theatrical release it had arranged for “Roma.”

Netflix’s negotiating effort was led by Scott Stuber, the company’s head of original films, who was previously the vice chairman of worldwide production at Universal. Two major exhibitors, AMC and Cineplex, offered what they believed was a reasonable compromise with the 60-day plan, according to the two people familiar with the talks.

Ellis Jacob, the chief executive of Cineplex, would not discuss specific numbers, but said, “I thought it was a very credible offer, and so did some of the people on the Netflix side. We worked quite hard to try and make it work for all of us.”

If Netflix had agreed to an exclusive 60-day run for “The Irishman,” other studios would have most likely demanded the same for their films. A new industry standard would have been set in a business that has clung to the belief that you close the theatrical window at your peril.

Mr. Stuber, who joined Netflix in 2017, has tried to bring peace to the two sides. “We do believe in box office,” he said in an interview. “We do believe in the consumer getting to see a film how he or she chooses. That’s what I’m trying to build toward without it being an all-or-nothing model.”

But the gap proved too wide for the two sides to bridge, and “The Irishman” is headed to venues content to show films that may be available on streaming services at the same time as their big-screen runs.

Mr. Fithian seemed flummoxed by Netflix’s stance. He wondered aloud why the company would not want to add a revenue stream — box office — given the competition in streaming that’s on the way from Apple TV Plus, Disney Plus and HBO Max, among others.

“Netflix is leaving significant money on the table,” Mr. Fithian said. “Think about ‘The Departed,’ in 2006. That Scorsese movie made $300 million globally. It garnered Scorsese the best director Oscar. It won best picture. It played for a long time in theaters and made a ton of money. Why wouldn’t Netflix want to monetize that before it went to Netflix? It can still be exclusive on Netflix. It can still draw subscribers. It would still be the only place you can see it at home.”

Mr. Fithian and Mr. Jacob, of Cineplex, said a theatrical release would provide a marketing boost that a traditional advertising campaign cannot deliver.

Mr. Stuber said he was not persuaded by that argument. “For ‘The Irishman,’” he said, “it was important for us to give it that theatrical run, to put it in big houses where people could congregate and have the opportunity to see it that way. But I also think people are going to love it just as much on Netflix.”

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