Last year, it was announced that Netflix had formally acquired Warner Bros. in a reported $82.7 billion deal. This was undoubtedly a huge development that would change the entertainment business as a whole, and nobody seemed to be very thrilled about it, least of all the cinemas.
Shortly after the deal was revealed, Cinema United made its position on the merger extremely apparent by releasing a subsequent statement. It said, “The proposed acquisition of Warner Bros. by Netflix poses an unprecedented threat to the global exhibition business. Cinema United stands ready to support industry changes that lead to increased movie production and give consumers more opportunities to enjoy a day at the local theatre. But Netflix’s stated business model does not support theatrical exhibition. In fact, it is the opposite.”
Adding, “Regulators must look closely at the specifics of this proposed transaction and understand the negative impact it will have on consumers, exhibition, and the entertainment industry.” This mega-deal between Netflix and Warner Bros. would risk removing 25% of the annual domestic box office if films that are traditionally given a robust theatrical release by Warner Bros. disappear from theatres. Netflix currently grants only a handful of their films a token theatrical release and the overwhelming.”
In an additional interview, Netflix CEO Ted Sarandos reassured concerned parties that the streaming service will continue to be “committed” to distributing films in cinemas, although these worries are quite legitimate. In an interview with Wall Street, he stated, “We’ve released about 30 films into theatres this year, so it’s not like we have this opposition to movies in theatres. My pushback has been mostly in the fact of the long, exclusive windows, which we don’t really think are that consumer-friendly.”
In any case, traditional 30- or 45-day theatrical windows had clearly decreased following the epidemic. Still, major theatre chains hoped to reinstate them over the ensuing years as the box office gradually recovered.
“I wouldn’t look at this as a change in approach for Netflix movies or Warner movies, for that matter,” Sarandos added. “I think over time the windows will evolve to be much more consumer-friendly… to meet the audience where they are … all those things we’d like to do. But I’d say that right now you should count on everything that has planned on going to the theaters through Warner Bros. will continue to go to the theaters through Warner Bros. And Netflix movies will take the same [path] as they have, which is some of them do have a short run in the theater beforehand.”
