For decades, the relationship between movie theaters and movie studios has always been symbiotic. Movie studios make the movies while movie theaters play them for a cut of the profits. When home video technology became available for audiences in the 80s, things started changing for movie theaters and studios. During the early 80s, a “theatrical window” was developed with the advent of home video technology. A theatrical window is when a movie is when a movie is in theaters for a specific period of time before it is released to home video. The theatrical, in essence, is an agreement between theaters and studios allowing for the maximization of profits. The initial window for movies was 6 months. But as of 2019, that window had shrunk to just 90 days, or three months before a film hit home video. In order to maximize profits, movie studios have been trying to continue to shrink that theatrical window, but they’ve been getting serious pushback from movie theaters that require that particular window in order to survive, despite their main profits coming from the concession stands. This year, however, things have gotten really bad with a global pandemic. Movie theaters shuttered with big blockbuster movies being pushed back months if not years until this thing ends. Some movie studios have opted to release some of their new releases on VOD like Disney’s remake of Mulan. While this particular experiment didn’t work for Disney, the possibility of cutting out the middle-man was there. So why am I bringing this up?
Just recently, The Hollywood Reporter and Variety both reported that Warner Bros. had announced that their entire 2021 slate of movies would be released simultaneously to both theaters and their proprietary streaming service, HBO Max. A couple of months back, Universal Studios had approached AMC Theaters about shortening the release window to 17 days before releasing their movies on home video/streaming services. The middle-man still existed, but the chances of the movie theaters making profits had dwindled. At that point, the deal didn’t go through, because big chains like Regal and Cinemark were against it, and if they weren’t on board with it, the deal wouldn’t have worked. But now that Warner Bros. made their announcement, the middle-man(movie theaters)is being cut out. Let’s be honest here: This was going to happen eventually anyway. No matter how hard movie theaters have fought this, the way the audience consume their entertainment has evolved over the past 20 years. With streaming services like Netflix, Amazon, and Hulu producing their own original content, movie theaters getting left in the dust was always going to happen. It was just a matter of time. Unfortunately, the pandemic has forced some movie studios to accelerate their plans. Some studios had complained that the timing of this was bad with the advent of a viable COVID-19 vaccine on the horizon. The problem is, is that it probably won’t be until the end of next summer when most people would be vaccinated.
How do I feel about all this? Warner Bros. had said that this was going to be a one-year deal, but anybody who has the slightest sense of business is going to know that this a lie. If this is successful, and there’s no reason to expect that it won’t be, it could very well be a permanent thing. The paradigm of the theater-going experience was always changing, but this situation is taking it in a different direction. Look, I love going to the movies. Watching Star Wars on the big screen is an experience that everybody should enjoy. Most movies are meant to be seen on the big screen. But we, as a society, are consuming our entertainment in different ways. Now we can legally watch these films on our phones, tablets, computers and TVs via streaming services. Me? I’m a huge fan of physical media, as I’ve got a pretty good collection of DVDs and Blu-Rays. But within the next 5 or 6 years, physical media will most likely be a thing of the past with everything going to streaming. Now some YouTubers like Chris Stuckmann have said that this thing would actually give people more options and lower the price of tickets for people who want to see movies on the big screen. I don’t think that movie theaters are going to die. Not at all, there’s always going to be a demand for them. But the convenience of watching these movies at home on the day of their release is going to be a tough challenge for theaters to overcome, and some of the smaller movie theaters will end up going out of business. Again, this was inevitable, but it really shouldn’t have happened this quickly. I would’ve expected at least another decade before this came to pass, but here we are. The movie industry will survive. The movie theater industry may also survive, but the winds are changing and it will never be the same. The best thing that I think we can do is wait and see what happens. This thing that Warner’s doing might end up not being successful. There’s always that possibility, but we have to understand that as long as this pandemic persists, these businesses have to do what they can to survive. That’s not always going please movie theaters and it may not please theater-goers. But the choices that these companies have right now are limited. On this sailboat of uncertainty, we have to wait and see where the winds take us.