AT&T Executives Double Company Budget amazing decision last week to make Warner Bros. The entire selection of 17 theatrical films for 2021 available to stream on HBO Max on the same day the films debut in theaters.
After a murderous weekend of criticism and pushback from directors, stars and critics, AT&T CEO John Stankey defended the unprecedented move as a ‘win-win-win’ – which, for WarnerMedia, would help nascent streamer HBO Max “break into the market.” faster.”
“Our feeling is that there is a win-win-win solution here,” Stankey said today at the UBS Global TMT virtual conference. “There is a victory for us, there is a victory for our customers and there is a victory for our partners. And every time you change your model, I know it creates some noise, and it’s certainly no exception. But I think at the end of the day the rational parties will take a step back and look at this and say, “ Give the room owners a predictable flow of content over the next few months that they can plan and start working on their. business is good for them. . ”
The move, which comes as conditions for theater owners and studios remain unfavorable amid the relentless Covid-19 pandemic, will almost certainly spell the end of the theater industry’s traditional 90-day exit window and could forever change consumer expectations when it comes to movie release. . Pragmatically, this is a sign that WarnerMedia believes theater business will be particularly slow to pick up.
The company didn’t want to hold onto the titles until the theaters could function more fully “because snow clearing all theatrical content until the end of 21 or early 22 probably won’t help anyone,” said Stankey. And even then, the studio is bracing for a slow return to theater seating.
“One of the unfortunate effects of the pandemic is that there has been virtually no theatrical presentation activity, and it is painful for a lot of people,” Stankey said. “In the theater business, we’re going to be in a situation where the psyche of the people, the willingness of people to go back to big venues… it’s going to be a bit of a prolonged recovery.
Another option on the table – selling the titles at a higher price than other streaming services in the market – could generate immediate licensing revenue, but would undermine long-term plans to expand WarnerMedia’s streaming ambitions.
“Giving these people who are your biggest competition additional weapons is probably not the smartest way to deal with this content,” Stankey said.
The move, which Stankey said “would give customers choice,” rocked the feathers of the industry, and some industry bigwigs have vigorously pushed back. Director Christopher Nolan, whose film Tenet premiered in theaters this year to disappointing box office returns, told the Hollywood Reporter Monday that “some of the greatest filmmakers in our industry and the most important movie stars went to bed the night before they thought they were working for the biggest movie studio and woke up to find they were working for the worst streaming service. “
Despite the murderous response, HBO Max will certainly benefit from the film’s slate, which Stankey says would help the streamer “get to market faster and faster” while also helping to keep customers engaged.
Even before release, HBO Max is growing. The service is approaching 12.6 million activated users, nearly 4 million more than the 8.6 million direct subscriptions reported by the company at the end of September in AT’s third quarter results & T. Time spent on the service is also increasing: Stankey said that over the past 30 days, the number of hours HBO Max customers spent watching the service increased by 36%.