April 26, 2022
LAS VEGAS — National Association of Theatre Owners (NATO) president and CEO John Fithian extended an olive branch to Netflix, which theater owners for years have considered an enemy due to its investment in original content and stepped-up original movie slate.
Speaking April 26 in the Caesars Palace Colosseum, he said the theatrical “door is always open for bigger, broader play of Netflix movies if that is a path they want to go down. They’re movie fans, like we’re movie fans.”
He also praised co-CEO Ted Sarandos, who once ran video rental stores, saying, “Ted Sarandos knows movies and TV better than anyone in Hollywood.”
Earlier in his speech, Fithian blasted the same-day theatrical and home release strategy that emerged during the pandemic, telling CinemaCon attendees that “simultaneous release is dead as a serious business model, and piracy is what killed it.”
He cited MUSO research that showed a big increase in piracy when high-profile new movies are released digitally at the same time as they open theatrically. MUSO said global film piracy increased by more than 33% during the lockdown.
When theaters were shuttered in the early days of the COVID-19 pandemic, studios shifted toward a digital release, generally at a premium price. Throughout the spring and summer of 2020, films that would have been major theatrical releases — including Disney’s live-action Mulan, Universal/DreamWorks Animation’s Trolls World Tour and Warner Bros. Scoob! — hit PVOD first before moving on to other windows.
The theatrical business didn’t begin to really recover until the spring of 2021. In the meantime, then-WarnerMedia chief Jason Kilar had made the stunning announcement that Warner Bros.’ entire theatrical slate of 17 major movies would be released simultaneously to whatever theaters were open and the HBO Max streaming service.
The theatrical exhibition business has come roaring back, despite periodic surges in COVID-19, but studios continue to tinker with same-day releases, particularly on smaller films. And the traditional 90-day theatrical window appears to have been permanently shattered. Warner Bros. is sending most of its films to HBO Max 45 days after their theatrical launch, while Universal Pictures is doing the same with its streaming service Peacock. The studio distributes select theatrical titles into the PVOD channel after 17 days if the box office is below $50 million.
Paramount Pictures is releasing most of its films to Paramount+ 45 days later, as well, although some, most notably Clifford the Big Red Dog and Paw Patrol: The Movie, are being sent to the studio’s streaming service on the same day that they hit the big screen.
Fithian implied theater owners can live with shorter windows but maintained day-and-date has got to go. He told CinemaCon attendees that if a film many people want to see is released immediately to the home market, it is much more vulnerable to piracy because of the greater profit potential for pirates.
Cinepolis CEO Alejandro Ramírez Magaña had essentially the same message during his International Day keynote address. He cited TorrentFreak data that showed nine out of the 10 most-pirated films in their respective launch weeks were day-and-date releases.