WarnerMedia sent shockwaves through the film world yesterday when it announced all of its 2021 films will be simultaneously released in theaters and on HBO Max. That means subscribers to the streaming service will be able to watch potential blockbusters like Godzilla vs. Kong, Matrix 4, and Dune from the comfort and convenience of their couches on the same day those films debut in theaters.
In a statement, WarnerMedia executives claimed the move will be a one-off decision for 2021, as it’s still unclear if or when theaters will be able to return to something resembling normal operation next year. But it unsurprisingly has consumers and observers speculating this portends the future of movies even after the pandemic—that the theatrical experience is on its last legs and the other major Hollywood studios will soon follow suit with streaming-first distribution strategies.
That’s not necessarily the case. WarnerMedia’s decision is specifically designed to provide a boost to HBO Max after the service’s lackluster US launch in May. HBO Max has not only struggled to penetrate the cultural conversation (though some recent series have shown promise), but it has also even been slow to transition existing HBO TV customers—who can get HBO Max for free—to the new platform. Free and easy home access to films that were originally going to head only to theaters, like In the Heights and the long-awaited Space Jam sequel, will probably change that.
WarnerMedia CEO Jason Kilar told Recode the move was mostly driven by the ongoing pandemic, but he also said HBO Max “will benefit materially from this decision.” The company has a number of constituencies to please—consumers, theater chains, investors—and also has a business to run. It’s making a wager that, for 2021, it is more important to throw the average consumer a bone (and elevate HBO Max in the process) than it is to invest in its relationship with the theaters. Other studios won’t make the same calculation.
Disney, for instance, may not need that same stimulus to its streaming service, Disney+, which is already wildly successful in the US and beyond. So not only does Disney have less motivation to bolster its service—but it would also stand to lose a lot more international box office revenue than WarnerMedia will, because Disney+ is available on several continents. WarnerMedia is still only available in the US. Everyone outside the US will still have to watch the studio’s movies in theaters next year. In a normal year, about two thirds of the total global box office revenue comes from outside the US.
And Universal, which just signed deals with two of the world’s biggest theater chains to shorten the amount of time movies play in theaters before they can be rented at home, likely won’t want to suddenly renege on those historic negotiations. Universal was the studio most prescient in postponing virtually all of its 2020 films into next year, so it clearly values the theatrical model. While it does have its own new streaming service in NBCUniversal’s Peacock, which launched in the US in July to moderate success, it doesn’t appear to agree with WarnerMedia that boosting its streaming ambitions is worth all the lost potential box office revenue.
Next year, other studios certainly will release some of their movies online or on video rental services, instead of or in addition to in theaters. While there is optimism a vaccine will allow moviegoers to return to theaters in the second half of the year, studios need to have other options ready. But WarnerMedia’s wider strategic shift for 2021 is not one that will likely be replicated by the whole of Hollywood.
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December 05, 2020 at 01:33AM
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Will other studios follow WarnerMedia's HBO Max release strategy? - Quartz
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