Read Part 1 here
Disney vs Netflix
(Studios vs Streaming)
The Venom and Spider-Verse movies have definitely breathed some new life into Sony Pictures. They’re now up in 4th place among the big studios revenue wise.
So there’s a question about whether Sony will ever give up the movie rights for Spider-Man back to Marvel.
I believe the real question to ask is about who owns the merchandising rights. Who sells the Venom toys and operates the Venom theme park rides. Those are the studios that will benefit the most (long-term) from the movie rights when all is said and done. That’s what we should be focusing on rather than the quality (or even box office) of said films.
You can only make so much from movies long-term. When all is said and done, any studio that doesn’t run its own ‘theme parks’ is vulnerable…unless they are owned by a bigger conglomerate that can provide additional integration.
Apart from Sony Pictures being owned by Sony (who make a lot of cross-promotional gadgets), the whole PlayStation ecosystem (which heavily features Spider-Man) can be said to be a form of theme park. Who knows, that might help keep Sony’s studios afloat.
Universal has theme parks (that’s where you’re likely to see the Venom rides) and is owned by Comcast…so they’re good. They have “shut up Disney” money and they have shown a willingness to use it if push comes to shove…or sometimes merely to shove Disney around. Guess who bought DreamWorks Animation for nearly $4 billion in 2016. They’re nearly right up there with Disney when it comes to the merchandising mindset but they also embody the other end of the paradigm when they keep costs low. So if there are only two studios left standing, it will be Disney and Universal…based on the number of franchises they own that are easily merchandisable.
Any studio that depends primarily on their movies being successful at the box office is vulnerable.
It’s high time the studios realize that it’s not enough for other studios to not exist. Even if Disney owned all the other studios, they wouldn’t be able to rest on their laurels. They’d still have to compete with Netflix, video games, sex, and any legitimate reason for anyone to leave their home (or not leave their home).
This means the studios had better start figuring out how to cooperate. The soft merger between Marvel and Sony to bring Spidey into the MCU has profited both Disney and Sony (albeit in different ways). That was a glorious exercise in giving the fans what they’ve always wanted.
“…and, by extension, the merchandising mindset…”
These studios need to stop struggling with each other because the cinema paradigm as a whole is under threat. Even Steven Spielberg and George Lucas (the pair that near single-handedly created the blockbuster and, by extension, the merchandising mindset) have had predictions of woe to share.
Like I said earlier, there is now more pressure for any blockbuster release to be massively profitable. This pressure means more fear of risk…which will hinder both creativity…and the ability to play the numbers game the likes of Netflix are playing. Banding together means studios can share risk and dream even bigger.
It means, someday, WB and Disney could decide to work together to create some Amalgam universe….because they’ve figured out that the fans ‘really want it’. If the thought of that bothers you, then you may need to put some petty “Marvel vs DC” squabbling aside and embrace this big cool future. Either way, these studios don’t have a choice. It’s merge or die. Yes, as I predicted, the death of the middle-class of films continues. This death is almost complete at Disney. In our lifetime, we’re likely to see only big merchandise movies and specific indie/arthouse/Oscar-bait/passion projects remaining at the cinemas.
Everything else will likely travel the on-demand route.
Eventually, the cinemas will evolve to a point where there won’t be additional special costs to studios for screening at the cinemas. Many cinemas will be configured to be able to ‘stream’ any movie at any time almost as soon as the distribution contract is signed.
That means no more arbitrary costs for prints. The movies will simply be uploaded to the cinemas’ servers and they will stream based on demand.
No more arbitrary release windows. The cinemas won’t share profit. They’ll pay a per-view (or per-thousand-views) licensing fee…and they’ll ‘stream’ the movies on-demand on their huge screens. First-come-first-served demand. Meaning that people will vote (with their dollars) for what movies they want to see and the theaters will screen the movies with the most votes at any given time slot.
The reason why this paradigm hasn’t taken over isn’t because the technology is not here. I posit that the reason is because the old guard is simply protecting its interests like a racket and I can’t blame them. They spent decades (centuries?) building the cinema infrastructure and are not planning any drastic transitions any time soon.
To them Netflix is like a poison…
…but streaming is here to stay. Who knows, Netflix might be the first to build these new-paradigm viewing centers (if Amazon doesn’t beat them to it).
I know there is some fear that internet users have found ways to ignore digital marketing (such as skipping videos) but I’m almost sure that this disdain for advertising actually started as early as the traditional media era. If people can skip videos online, they can surely skip your friggin’ TV ads. At least now you can ‘know’ if your internet videos are being skipped.
I repeat, it makes little sense (commercially speaking) to cast a wide unpredictable net when you can get a prior commitment from those that will see your film. Technology now abounds for accurately tallying the exact number of people who want to see your film made. Think Kickstarter if you must.
Zero waste with this model. It’s a no-brainer. I know I said in my earlier article that humans don’t really know what they want. It’s almost contradictory, but whether humans know what they want or not, it’s still better to get as many commitments as possible before you spend your money. Yes, people don’t know what they really want till they see it. So you find ways to show them teasers early…and get their individual feedback (if not early financial investment). Another advantage of the new model is it costs viewers less to take a chance on your work . If the critics hate on a movie like Bright, it won’t cost on-line subscribers as much to still see the movie to find out what the fuss is about. At least, not as much as it would cost them if they were to take their bath, dress up, drive to the movies, and buy tickets (don’t forget the popcorn). The old model can max out at 400 million people in a year each paying 10 bucks to see one particular movie. That’s 4 billion dollars that the most successful movie in the world could possibly make (and something tells me I’m being really generous here), half of which does not go to the studios and isn’t enough to keep the cinemas free from a dependence on overpriced concessions. The new streaming model can max out at 3 billion people in a year each paying 2 bucks to see a movie. Yes, I just yanked those numbers out of my ass, but if I got you to imagine the future with me for only a second, then it was worth it.
While I agree with Spielberg that cinemas need to be around forever, I disagree with his reasoning for excluding the streaming companies from the Oscars. Yes, television has a particular format (for example, aspect ratio, length/time allotment, and, many times, quality) that lends itself to the television distribution format. However, the streaming platforms are not truly restricted by format. They’re a more versatile medium for distribution. They can distribute any film or TV show irrespective of aspect ratio, length, or quality. They can even distribute Spielberg’s movies (Spielberg has admitted that his movie Lincoln was almost an HBO movie…I wonder how he would feel about losing all those Oscar noms and wins the movie eventually had). A Spielberg movie is a Spielberg movie. I don’t see how it makes sense to distinguish them based on how many weeks they spent in the cinemas… …unless we’re afraid the streaming platform will kill the cinemas. Now, if they’re going to kill the cinemas, they will kill the cinemas. Your excluding them from the Oscars won’t stop that trend. I can’t believe I’m having the nerve to disagree with Spielberg. Just to be clear Mr Spielberg, I still worship the ground you walk on and I will sacrifice a lot for the opportunity to fetch coffee on your movie set. Till then, no need to panic about cinemas disappearing. Buildings with huge rooms where movies are projected onto a huge screen will always be with us…the same way TV hasn’t done away with radio or the way the internet hasn’t done away with TV. While, these traditional platforms will no longer be the default means of distribution, they will all hold on to or manifest their true niche value offerings.
Yes, cinemas will no longer be the platform for first/exclusive-window viewing. They will simply be part of the theme-park. A very awesome important part of it.
Thanks for your time.
Artist who loves spreadsheets.