The Year Without a Summer
The cataclysmic eruption of Mount Tambora in 1816 caused a devasting climate shift resulting in widespread crop failure, starvation, and bread riots. It was called the Year Without a Summer.
The theaters are having their own version of that next year.
As I reported yesterday, Warner Media has announced that its entire production slate of films will be dropped on to HBOmax this year. Denzel Washington’s The Little Things, Judas and the Black Messiah, Tom & Jerry, Godzilla vs Kon, Mortal Kombat, Those Who Wish Me Dead, The Conjuring: The Devil Made Me Do It, In the Heights, Space Jam: A New Legacy, The Suicide Squad, Reminiscence, Malignant, The Many Saints of Newark, King Richard, Cry Macho, Matrix 4, and of course, Dune.
This isn’t just the nine-figure budget tentpole films, this is the whole catalog for 2020 and 2021. This is everything. Warner Media is leaving the theaters with NOTHING.
“Following the one-month HBOmax access period domestically, each film will leave the platform and continue theatrically in the U.S. and international territories, with all customary distribution windows applying to the title.”
In case you are wondering what, that bullshit means; Warner locked itself into a bad deal. Before they decided to get into streaming themselves, they sold off all of their streaming rights to their future catalog a few years ago. They won’t be able to keep any of their new films until those contracts expire in 2024. Good play guys!
So why bother, you ask? Because they have got to get eyeballs on HBOmax now! This service was meant to compete with Netflix and Disney+ but the truth is they are competing with CBS All-Access and PlayStation Vue. They are a very, very distant third, I mean their horse has barely waddled out of the starting gate, while the front runners are rounding the turn.
In their statement Warner claimed that this is just a one-time experiment and that they will be just tickled pink to go back to theatrical exhibition in 2022.
This is called, “lying.”
They know perfectly well that this is the death stroke. Short of a major government bailout, (and they don’t have the bribe money), the theater chains can’t survive this. They were over-specialized to begin with and the market has shifted too drastically, too fast.
The one thing that Warner Media isn’t lying about is that this is a one-time thing. Warner is only doing this once because they are getting out of the movie business.
The risk to reward was always too high for anyone’s comfort. The budgets were backbreaking, and they had to pay spoiled and demanding movie stars a ton of money. At their height, casting Robert Downey and Johnny Depp were strategic decisions that had to be approved by the board of directors.
Now, the studios are all shifting into streaming. HBOmax had a very bad stumble out of the gate. They had too many specialized streaming services (Crunchy Roll, DC Universe) when the market trend was clearly leaning hard towards aggregation. My initial review of HBOmax was more positive than I expected it to be but that didn’t stop me from canceling the service.
Mega-budget blockbusters don’t generate enough money to justify making them. But so long as you have them and can’t recoup your investment in theaters, you are better off using them to generate subscriptions as “a one-time experiment.”
Which means that this is going to be a Year Without a Summer for the theater chains.
Although, this could also mean a major opportunity this year for smaller production companies.
Regardless, my prediction for the cinema mega-plex is unchanged. They were built to serve a market that no longer exists.
