Why the "New Normal" at Theaters May Mean a Premium Experience for Moviegoers

[Mark Gulbrandsen]

Does Disney post any numbers on how many pony up $30 for advance access to one of their movies? I'd bet whatever that number might be likely wouldn't compare very well to how many people were buying DVDs back in the 2000's.

Disney and HBO Max both have tens of millions of subscribers. But the money Disney and Warner Bros are supposedly gaining from those subscriptions isn't all profit. Both have to produce a steady stream of new movies, TV series and other kinds of stream-able content. The revenues they're gaining from subscriptions are making a negative dent in revenue coming from theatrical box office sales and home video sales (both physical discs and "digital" sales).

HBO has announced that starting in 2022 they'll no longer release movies in theaters and on HBO MAX simultaneously. There was some confusion about the re-make of Dune, due to be released October 1, whether it would get an exclusive theatrical window. But Warner Bros is sticking to a day-and-date release via HBO Max. The movie's director, Denis Villeneuve, has been publicly critical about the lack of a theatrical window, saying Warner Bros is going to kill the Dune franchise just to bait more subscribers. The upcoming movie adapts just the first half of Frank Herbert's novel, so at least one follow-up installment would be expected. If Dune tanks at theaters (which is possible) that follow-up movie might not get made.

Netflix still has far more subscribers than any other streaming service. I don't know the breakdown of it, but to me it sure looks like Netflix puts a lot more into original series TV content than it does with movies. Even Amazon does more to push series TV than it does movies. Viewers have to keep watching longer and subscribing longer when they get vested in a series. Movies are watch it once and you're done kinds of things, especially today with the Save the Cat bible formula still being applied to so many of them.

I think the best bet for movies is shoring up the theatrical release platform and extending the exclusive window weeks if not months longer. Going the other direction with little to no window at all could lead to hundreds or even thousands of theater locations closing for good. Without the theatrical platform a traditional 2 hour movie will just be a TV show trying to compete against a lot of series productions on the same platform.

And Spielberg just signed with Netflix to make several films for them...

[Marcel Birgelen]

Netflix still has far more subscribers than any other streaming service. I don't know the breakdown of it, but to me it sure looks like Netflix puts a lot more into original series TV content than it does with movies. Even Amazon does more to push series TV than it does movies. Viewers have to keep watching longer and subscribing longer when they get vested in a series. Movies are watch it once and you're done kinds of things, especially today with the Save the Cat bible formula still being applied to so many of them.

With the theatrical release cycle entirely gone, expect blockbuster movies to be a thing of the past. You get far more minutes for your bucks when investing into series, series will keep your audiences engaged longer and as long as they're successful, you can keep churning out new seasons, with just marginally investing into new IP. Heck, series can even borrow plots from other series, popular sub-plots can be spun off into their own series...

Netflix's primary goal is to keep their subscribers onto the hook as long as possible, for the least expenditure possible. Some directors may still want to make some movies, but don't expect any giant budgets, other from a few, mostly self-financed superstars, the likes of Cameron. But the heydays of the blockbuster movie are over...

[Bobby Henderson]

In the new world, everything is a smash hit. They don't have to deal with the Monday morning numbers where their $200 million movie is declared a flop because it "only" made $90 million on opening weekend when all the experts were expecting 120.

They're probably loving this new normal.

I'm sure the Hollywood studio accountants might be loving it if it's actually generating more revenue. I'm under the impression this big switch to streaming will be, at best, a sideways move that gains them nothing but possibly sets them up for slow, steady, long term losses.

At the very least, the studio accountants will appreciate the less public "box office" numbers. It will make it easier for them to apply Hollywood's famous rolling break even treatment to the books.

Meanwhile commercial movie theaters will find it harder to survive. I don't think very many people are considering the farther reaching negative scenarios of what could happen if commercial movie theaters close across much of the United States. The situation will adversely affect more than just the jobs inside the movie theater building. Some people hate movie theaters and hate "Hollywood," but like it or not commercial movie theaters are an anchor for local business. Movie theaters are an attraction for people to get out of the house.

We've all been hearing about the retail apocalypse and how it has affected shopping centers of all types. If anything the closure of so many big box stores and traditional department stores makes those shopping centers more dependent on movie theaters to attract people to those commercial districts. Take away the movie theaters and there won't be much left other than restaurants and small retailers that have to charge a lot more than Amazon to cover their rent. That's not a good scenario.

And Spielberg just signed with Netflix to make several films for them...

I've been a big Spielberg fan for a long time, but what is the last really big hit he has directed? He's had some critical successes in recent years (Lincoln, Bridge of Spies). But you have to go back 15-20 years to find a period when his movies were still as much a box office draw as any director. The most recent stand-alone Spielberg movie I have in my collection is Minority Report from 2002. I don't count the 4th Indiana Jones movie from 2005 since that was included in a Blu-ray box set.

Anyway, we'll see what happens with his re-make of West Side Story. I have a feeling Spielberg might try to do something a bit different or unconventional with his Netflix deal.

With the theatrical release cycle entirely gone, expect blockbuster movies to be a thing of the past. You get far more minutes for your bucks when investing into series, series will keep your audiences engaged longer and as long as they're successful, you can keep churning out new seasons, with just marginally investing into new IP. Heck, series can even borrow plots from other series, popular sub-plots can be spun off into their own series...

I believe big budget style "blockbuster" movies will be the first thing to go if a massive reduction in commercial movie theater screens occurs. I would expect an overall large reduction in 2 hour movie productions if everything gets concentrated into streaming services. Series-based content does far more to keep viewers watching a specific streaming service longer.

It should be said this glut of series TV can cut another direction. I'm personally very careful about starting to watch any new series. It's a big time commitment. Just about all these shows feature a continuing story line, which forces the viewer to watch everything from the beginning. I have plenty of other things to do with my spare time than watch TV. Sometimes it's hard enough just to make time to watch a 2 hour movie.