In its never-ending quest to win an Oscar for Best Picture, it seems that Netflix will be releasing at least one of their original movies into cinemas each year in some form or fashion. Questions remain, however, exactly what forms and fashions Netflix has in mind when releasing their films theatrically, and whether they will upend longstanding industry practices that key stakeholders heavily rely on.
A Little Background
To date, Netflix has followed the traditional method of entering the annual awards season; the same time tested technique employed by the traditional Hollywood studios. Starting in September the company premieres some of its awards contenders at prestigious fall film festivals such as those held in Venice, Telluride, Toronto and New York. It initiate a press campaign over the next two months building toward a November theatrical release limited mostly to arthouses in major cities (New York, Los Angeles and also London). This is because Netflix refuses to honor a traditional theatrical release window and thus most large cinema chains refuse to book their films. In fact, the next step for Netflix in its march toward collecting accolades is to make a film available on its streaming platform less than 30 days after it premieres in cinemas, usually in December.
It is around this time that Netflix commences with a hefty awards campaign for the movies they believe will vie for awards. This is the route filmmaker Alfonso Cuaron’s “Roma” took in 2018 on its way to winning three Oscars, including Best Foreign Language Film, two Golden Globes and four BAFTA Awards including, controversially, Best Film. Its run began at the Venice Film Festival, where it took home the Golden Lion. It then barnstormed through festivals in Telluride, Toronto and New York, in short order winning tons of critical praise on its way to 10 Oscar nominations. Depending on who you ask, the amount Netflix spent on the Oscar campaign for “Roma” was as little as USD $20 million and as much as USD $60 million. To put that in perspective, keep in mind, the movie’s budget was USD $15 million.
Those figures pale in comparison to the reported USD $150 million Netflix spent on its big awards movie this year; Martin Scorsese’s highly anticipated “The Irishman.” Netflix agreed to produce the movie after all the major studios turned it down due to the astronomical production budget and three-and-a-half hour running time. “The Irishman” was released in cinemas on 1 November (in the United States) after premiering at the New York Film Festival in September. Netflix will begin streaming it on 27 November. No word on when or if the company will send out a pricey coffee table book as part of its awards campaign, like it did for “Roma.”
Box Office Disruption
Living up to its reputation as a market disruptor in the television industry, Netflix is developing the same persona for distributing its movies theatrically. With many exhibitors shunning Netflix releases that don’t provide a theatrical release window, (which is all of them so far), the company has been four-walling its movies; a distribution method in which a distributor rents an auditorium from a cinema operator, usually by the week. In most instances, the distributor gets to keep 100% of the box office for the film, rather then split it with the exhibitor.
During the release of “Roma” there were more arthouse and independent exhibitors that reached out to the company hoping to show the film then Netflix was willing to book. Those cinemas that wound up showing “Roma” had to do so under a very strict set of guidelines and rules set forth by Netflix. Chief among them was that absolutely no box office or attendance was to be reported to anyone other than Netflix. That includes Comscore, Numero or any other box office aggregators.
Because Netflix monetizes its films through its streaming platform the company doesn’t really care whether they makes a fortune at the theatrical box office. The company has all but stated publicly that the only reason it distributes movies to cinemas in the first place is to appease A-list filmmakers like Scorsese, qualify for awards and pick up whatever prestige there is from winning awards while working with A-list filmmakers. Any box office grosses it collects are nice, but not necessary. Instead, Netflix focuses, in-part, on how many subscribers its movies attract, both new and existing. Every time a subscriber streams one of their original movies rather than watch a studio film Netflix is saving money on licensing content.
Source: The Problem With Playing Netflix Movies in Cinemas – Celluloid Junkie