This is wild. Here’s Netflix CEO Ted Sarandos, at a TV industry gathering in London, trying to make the case that streaming is the way to go for big-budget movies, and not theatrical.
Sarandos claims that the streamer doesn’t feel the business need to recoup film investment in cinemas, he explained. “It’s unique to Netflix that we have enough scale,” Sarandos said. “We can uniquely spend $200 million on a film and have enough scale of viewership to put it directly on Netflix without trying to recover some of the economics in the theater, which I think is a fairly inefficient way to distribute some movies.”
Essentially, Sarandos is all about viewership and subscription numbers. Spending $200M on a movie, which makes no money back, and just gets “views,” is the way to go. He has no interest in theatrical exhibition, and he’s really going to die on this hill. A film being financially successful is besides the point, according to Sarandos.
Of course, it’s not just about “views” with Netflix — they make a good chunk of their profits off of ad revenue and subscriptions. Meanwhile, Netflix’s business numbers rely heavily on the stock going up. Their main concern isn’t necessarily making their money back on a $200M+ movie.
Yet, Sarandos is also leaving a TON of money on the table. The media treats every streamer misstep as a pinata to swing at, except for Netflix. A recent report claimed that with a P&A spend, “Glass Onion: A Knives Out Mystery” could have grossed $600M in global box office if it had received a normal theatrical rollout.
Netflix has another opportunity to make amends by releasing the next ‘Knives Out’ installment, ‘Wake Up Dead Man’ in theaters, where it belongs. However, most believe Netflix will not be doing that — they have a “strategy,” and it doesn’t involve theatrical exhibtion.
What Sarandos/Netflix are essentially doing is killing cinema, that’s their end goal. Don’t kid yourselves otherwise. They would like nothing more than to have theatrical die and be turned into the big game in town. The fewer people that go to cinemas, the more successful Netflix gets. They have no desire to help the movie ecosystem.
Edward Berger seems to have settled on what comes next. His Lance Armstrong biopic, starring Austin Butler, is now holding casting calls, with production eyed for January.