Ted Sarandos, boss of Netflix, has described cinema releases as ‘inefficient’. But doesn’t the streaming giant have a vested interest in the theatrical experience dying out…? Another speech by Netflix boss Ted Sarandos, and once again, the man manages to get he and his company headlines around the entertainment press. He says things, we fall ... Netflix seems to be forgetting that the world existed before Netflix
Ted Sarandos, boss of Netflix, has described cinema releases as ‘inefficient’. But doesn’t the streaming giant have a vested interest in the theatrical experience dying out…?
Another speech by Netflix boss Ted Sarandos, and once again, the man manages to get he and his company headlines around the entertainment press. He says things, we fall for it, names get checked, and the wheel keeps turning.
Still, two pieces of news coalesced at the same time yesterday, and they’re worth having a chat about.
On the one hand, Ted Sarandos gave an address in London where he argued that a cinema release is an “inefficient” way to distribute a film that’s cost $200m to make.
To de-clickbait his comments a little, he also admitted that “it’s unique to Netflix that we have enough scale” to put its films out, the kind of scale that means you have your own huge distribution platform and don’t need anyone else’s.
It isn’t really unique – Disney and Amazon could claim the same – but Netflix has a subscriber base that makes the cinema entirely avoidable. Sarandos clearly intends to avoid it, only dialling back slightly when pressured to by certain filmmakers.
But even that pressure doesn’t always persuade him.
For the other story, the long-mooted Sims movie was confirmed this week as well, with Margot Robbie’s LuckyChap Entertainment backing that particular project. Deep in the reveal of The Sims though was that LuckyChap had signed a deal with Amazon-MGM for the movie, even though Netflix offered more money. The reason? Amazon was willing to stump up for a cinema release, Netflix wasn’t. Robbie took the lower offer.
You may recall that the last time Robbie took on a how-do-we-make-a-film-out-of-that project, it turned out to be Barbie. Warner Bros’ clearly woeful, inefficient method of distributing that film brought in over $1bn in cinema takings, which in turn fuelled interest in its eventual home formats release.
It’s why – even digging past the sensational headline – it makes Sarandos’ argument curious. Get everything correct and lined up, and you can get the best of all worlds. To go two dimensional and Microsoft Excel-driven, there’s revenue waiting to be made in lots of different places.
Look at Disney.
I can’t say I was a fan of the film, but the $1bn+ gross for Deadpool & Wolverine is instantly useful change for the company’s coffers. But also, that cinema release has created a loud noise around the movie, to the point where the streaming debut for the movie – it starts its home roll-out next month – is going to be gigantic.
Would it have been as big without the cinema? Maybe, but the story of, say, Black Widow suggests otherwise. That was the Marvel film starved of cinema’s oxygen, and while it wasn’t the best received in the saga, it still feels like it’s barely spoken about now. Not quite the lost Marvel, but considering where it sat in the chronology of its films – so close to its biggest successes – I do wonder if it paid a price for not getting a full big screen outing.
Going back to Barbie and its competition, though. To pick a Netflix release from around the same time that film hits cinemas, The Out-Laws was produced by Adam Sandler, headlined by Adam DeVine (who also produced), and – while Netflix keeps its production budgets to itself thank you very much – was a more modest film than Barbie.
I’d argue it’s also pretty much a forgotten one: no matter the merits of the movie, it’s grist to the mill, fuel for the Netflix content machine, which needs news things to keep subscribers interested. It’s been successful according to Netflix’s own numbers, but beyond that, doesn’t seem to have made much of a footprint. Made to a formula, hits the formula, stays within its tramlines.
Perhaps a better parallel is the nearest blockbuster Netflix had to Barbie’s release date: Heart Of Stone, the spy thriller that landed on the service a week or two later.
Costing a reported $150m, the movie stars Gal Gadot and didn’t get much critical attention, outside of appearing on a few worst film of the year lists (I don’t like such lists, personally), and – more positively – earning Gadot a People’s Choice Award nomination.
Still, the film didn’t have a cinema release and thus its moment in the sun was, say, two weeks on the front of the Netflix menu. Countering that, it was the most popular movie on the service on its week of release, and reportedly the second-most watched film on the service in the back half of last year, so for Sarandos’ purposes, the box has been ticked.
After all, for Netflix, it led to over 100 million people spending two further hours on its service (assuming they skipped the credits), and that’s the goal. Has the film had any further footprint? Again, I’d argue not. If you wanted to watch it today, it’s still there. That said, I do think there’s still something of a Coda effect about it, which I talked about last year.
Netflix’s most popular film of all time incidentally is also one of its most expensive: the pretty tepid Red Notice, which cost in excess of $200m, and starred Dwayne Johnson alongside Gal Gadot and Ryan Reynolds. Coming up in the future, it’s reportedly spent over $300m on the Russo brothers’ The Electric State, and will be looking at a Rebel Moon-esque promotional campaign for the film. Positioning it as a blockbuster, using the tactics of cinema releases, but not actually bothering with the cinema.
At heart, Sarandos is sort of right. There’s nothing particularly efficient about a cinema release. Just on a logistical level, it involves striking prints (well, Digital Cinema Packages), booking screens, and persuading people to leave their homes. It’s a whole lot of effort all round. On one hand, that’s arguably what makes it all a bit special, but on the other, there’s a lot of faff involved.
In terms of business efficiency, he’s better placed to comment on his own business than me. But I do wonder if he looks at the 125-year plus history of films, and dismisses it all as people doing it all the wrong way until Netflix turned up. Or that he’s revelling in the idea of Netflix being a ‘disruptor’, and looking for new ways to turn things upside down.
I’ve read lots of stuff over the years suggesting that Netflix wants to kill off cinema, and I’ve never really bought it. But conversely, I’m increasingly of the view that it’s to the actual benefit of Netflix if the cinema and theatrical releases actually die.
Yet there was a world of film before Netflix came along, and there will be a world of film when it decides it wants to try something else. Looking through the film release calendar between now and the end of the year, it’s hard to find a week where there aren’t eight to ten films going onto the UK cinema circuit. That’s down on pre-pandemic times certainly, and there’s also some emotive and personal reasons for moviemakers wanting a big screen release.
Yet there’s also, I’d suggest, the sense that a cinema release can be and is an important part of a film’s lifecycle. It was always so, and as much as people do tend to fear change, I do think it still is. I remember when home video first arrived, and that was going to kill cinema, as it was more efficient to put films straight onto VHS. Before that, when television became mainstream, that was going to kill cinema, and it was more efficient to make material just for the small screen.
Here we are again, with the head of a company that needs to make billions a year to break even, telling us that a cinema release is inefficient. Trying to talk us out of it. Trying to change a medium that’s evolved over more than a century, with a massive cinema screen at its heart.
It might be folly for you, Ted. It might be for Netflix. But also, Netflix is – as much as the noise around it may suggest otherwise – a small part of the movie ecosystem. It’s backed films that others never would, and that’s a huge positive. It’ll still put a smaller film such as His Three Daughters on a small cinema run, at least for the time being, and that’s a huge positive.
But at the top of the company, there’s little sense of a love for film. Again, others are the same – just do a search for David Zaslav for evidence of that. Yet let’s not conflate things, even so. Netflix is a part of the film world, and works within it. Netflix is not the parent of cinema, nor any kind of steward of it. And reducing movies to efficiencies plays to a bigger goal. Cut the cinema out, make the cinema less desirable, more people watch their films at home or on their personal devices.
It doesn’t feel like progress. It feels a little like vandalism. It also, ultimately, doesn’t feel like where cinema’s come from, or where it should go.
And that’s the case wherever you ultimately choose to watch The Sims…
