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Three Studios, Three Strategies: How COVID-19 Turned Film Releases Into a Free-for-All

Studios were always competitors, but after the pandemic are they all in the same business?

"Wonder Woman 1984"

“Wonder Woman 1984”

Warner Bros.

With “Wonder Woman 1984,” Warner Bros. is experiencing deja vu. Once again, they see exhibitors and the press holding their collective breath over a $200 million tentpole; once again, like “Tenet” before it, the film is becoming less a symbol of entertainment and more of a return to normalcy at theaters.

All of that adds tremendous gravity to any decision Warners makes, whether it keeps it at Christmas (very unlikely), adds home viewing options after a short window, or delays the film for months down the line. The lone certainty is that without significant films in December, and with a surge of COVID-19 cases, theaters face yet another existential crisis.

Warners’ strategy will reflect its own internal realities, and therein lies the difference. Before COVID-19, in most cases most studios would make similar decisions in handling their top films’ releases. That is no longer true.

PVOD is an option for any studio, but Sony and Paramount opted to sell some key titles to streamers like Netflix, Apple, and Amazon to cover their costs and perhaps make a small profit. They have neither the market strength nor the direct streaming options or PVOD experience seen by the top three. They also could be merger or acquisition targets; expect them to follow the leader.

Here’s a look at how the three dominant studios (Warner Bros., Disney, and Universal) are dealing with uncertain times.


Last year, Disney held 33 percent-38 percent of the domestic box office. Most of its films are budgeted over $150 million.

It also placed the biggest bet on streaming with the launch of Disney+ last November, which now claims over 70 million subscribers worldwide, likely approaching 50 million in the U.S. By making two of its top 2020 releases exclusively available on Disney + (“Mulan,” initially as a $29.99 PVOD offering, and “Soul” at no extra cost), it proved that home viewing is its current platform of choice.

Disney’s corporate pronouncements follow a similar line, with reorganization based on the idea that theaters are a “legacy platform.” A new division, separate from content creation, determines where each project will be distributed.

The assumption remains that blockbuster franchises like Marvel’s “Black Widow,” “Shang-Chi and the Legend of the Ten Rings,” and “The Eternals,” or the “Star Wars” entries, need a worldwide theatrical release to make money. Disney has delayed dates rather than push them to Disney+ or PVOD, which suggests they still hold that view. It’s also set up for alternatives.

“The Croods: A New Age”



As the first studio to jump on PVOD in the COVID-19 era with “Invisible Man” and “Trolls World Tour,” NBCUniversal CEO Jeff Shell told Wall Street that it planned to release films with aggressive home-availability timelines going forward. AMC responded by claiming it wouldn’t play any Universal titles.

Flash forward a few months and AMC has agreed to play all Universal films, with a PVOD option after the third weekend of theatrical play at the studio’s discretion. In return, AMC receives a revenue share.

This weekend sees the release of Blumhouse title “Freaky,” with “The Croods: A New Age” November 25. “News of the World” is set for domestic theaters at Christmas (with international rights sold to Netflix).

For the last six months, Universal has been the major theatrical provider — but theaters have to accept the studio’s terms on windows. For “Freaky,” it’s three weeks. “Croods,” a little longer. Exhibitors can turn down any film, and maybe attitudes will change post pandemic, but the dam has been broken.

That’s a win-win for Universal; less so, for theaters.



Warner Bros.

Warner Bros.

The studio that led the sound revolution over 90 years ago and has consistently been among the top three studios in recent decades is a natural to speak out most aggressively for theaters. It lags in streaming, with HBO Max having fewer than 10 million domestic subscribers.

Key filmmaker Christopher Nolan and major production partner DC Comics also favor theaters. Both make expensive movies, and DC has strong worldwide appeal (international is much weaker in streaming and PVOD). That makes the survival of the theatrical model even more critical for Warners.

With “Wonder Woman 1984,” it has a sequel that — based on the performance of the 2017 initial film, before COVID — once had the potential of a $1 billion worldwide theatrical gross. That’s likely beyond any chance of happening in the near future.

So Warners has these choices: Stick with December 25, take whatever theaters are available, and benefit from the holiday and the lack of competition. Or, go December 25, but have aggressive PVOD or HBO Max availability. Or, delay the film — perhaps until summer, when the hope is initial vaccine use and other measures theaters will bring us closer to normal.

Any choice will result in depreciated returns. That’s no different than what other studios face, but Warners has the most recent change in corporate ownership and the most turnover among executives. Although new WarnerMedia CEO Jason Kilar is a streaming-first leader, his movie studio seems to be facing something of an identity crisis.

Crisis can mean opportunity. COVID-19 pushed up the transition from a theater-dominant model by several years. The question is how theaters fit in when the dust settles, and no one knows when they can reopen, whether audiences will return in sufficient numbers, or whether financially challenged circuits can survive.

We are witnessing something radical. We don’t normally get to see models being tested in real time. We also aren’t getting much in the way of data, so we will have to gauge success by what each studios chooses as its preferred models.

Determining what we consider a movie will have decreasing relation to how it is shown: a loss for theaters and viewers, but perhaps a salvation for the medium.

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