Movies

Warner Bros. will Debut all 2021 Films on HBOMax

WarnerMedia of AT&T revealed Thursday that at the same time they hit theaters, its entire slate of 2021 theatrical releases would debut free for HBOMax ‘s U.S. subscribers. Due to the Covid-19 pandemic, it’s the boldest step by a big movie studio struggling with theater shutdowns. This year, other studios have carried out numerous experiments with movie launches, but the signs are clear that the exclusive windows of theaters for movies are going extinct. As so many other emerging trends intensified by Covid-19, the way we watch theatrical releases during 2020 saw huge changes. The most critical shakeup: AT&T’s WarnerMedia revealed on Thursday that all Warner Bros. 2021 theatrical releases would debut at no extra cost on HBO Max for U.S. subscribers at the same time.

Warner Bros. will Debut all 2021 Films on HBOMax
WARNERBROS.

That means you’ll get to watch blockbusters like “Dune,” “The Matrix 4,” and The Suicide Squad” from your living room couch if you’re already an HBOMax subscriber, instead of risking a trip to the theater next year.

They all saw this coming. With the advent of video streaming, with the exception of the largest blockbusters, interest in going to a theatre and investing all the time and money to watch a two-hour film plummeted. The brightest media theorists saw a not-to-distant future where lining up for a movie release outside a theater would only become a niche occurrence for the most committed cinephiles. And when Covid struck, theaters were forced to close and studios had to think up imaginative ways to get their 2020 releases eyeballs on their slate.

There’s been a lot of experimentation from different studios across the year. For example, Disney released its Pixar animated film “Onward” directly on its Disney+ streaming service early on in the pandemic. And several movies were released directly to on-demand platforms, including Universal’s “Trolls: World Tour” and “King of Staten Island”.

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But when it became apparent that theaters would stay closed for months or reopen with strict capacity limits, as blockbuster films in 2020 saw delay after delay, studios were forced to become ever more creative.

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After many delays, for a one-time, $30 charge, Disney released its $200 million film “Mulan” on Disney+. Disney has not yet announced sales for “Mulan” but at the company’s investor day on Dec. 10, executives promised further information on its theatrical release plan. It will be fascinating to see how Disney’s 2021 ambitions compare with this week’s bold move by WarnerMedia.

HBOMax: With major theater chains including AMC and Cineplex, NBCUniversal negotiated a narrower theatrical window, meaning movies will go straight to on-demand sites in a month or less, down from the usual 90-day window.

Bear in mind that the studios are careful to say that these moves are all temporary, and that once the pandemic is over, they would like to maintain their partnerships with theaters and it is safe to go out to the cinema again.

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In an interview Thursday, “Everyone should take a breather,” WarnerMedia CEO Jason Kilar told CNBC’s Alex Sherman. “Let’s let the next six, eight, ten months play out And then let’s check back in.”

But Kilar also left space for the disruptive model he unveiled on Thursday to be sustained.

“Certainly this is pandemic-related,” said Kilar. That’s why we’re doing it. In 2022, we have not spent one brain cell on what the world looks like.”That’s why we’re doing it. We haven’t spent one brain cell on what the world looks like in 2022.”

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And the truth of the situation is seen by the sector. Following WarnerMedia’s announcement, AMC shares tanked 16 percent Thursday, an indication that investors expect that straight-to-home movie releases are a trend that other studios will jump on and customers will prefer.

“Clearly, WarnerMedia intends to sacrifice a considerable portion of the profitability of its movie studio division, and that of its production partners and filmmakers, to subsidize its HBOMax start-up,” AMC CEO Adam Aron said in a statement Thursday. “As for AMC, we will do all in our power to ensure that Warner does not do so at our expense. We will aggressively pursue economic terms that preserve our business.”

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On the other hand, for the studios, there is a chance. If they are subscribers to any particular streaming service, is it worth spending $100 million or more on a movie that will be released directly to consumers in their homes at no extra cost? Theaters are where studios make a lot of their money, particularly in international markets, even though we’re trending toward a majority-streaming future for movies. Economics doesn’t just work out.

HBOMax: Moffett Nathanson analysts wrote in a note Friday reacting to the WarnerMedia announcement, “Pushing your best content into a subscription window caps the upside on the truly mega hits that drive all of the profit,” “And the move into HBO Max undoubtedly will have downstream impacts on home video and rental revenue streams, as well.”

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In the meantime as the pandemic rages on we will continue to see a lot of experimentation from studios. It may be a hybrid model, where to watch a movie through a provided streaming service, you pay a one-time fee. (The Disney-“Mulan” model.) Or after a shorter-than-normal theatrical window, go straight to on-demand services. Or just give the movies away for free, hoping it will persuade more people to subscribe to a subscription service. (The NBCUniversal model.) But the signs are obvious that we’re leaving the theater windows for good in the early innings.

Nevertheless, even though that might be the current plan today, we have a hard time believing the message that this is just a temporary 2021 plan,”We have a hard time believing the messaging that this is only a temporary 2021 plan, however even if that might be the current plan today,”

“Once the windows change, it will be hard to go back.”

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