WarnerMedia made some waves in Hollywood with the announcement that all 2021 Warner Bros. movies will simultaneously release on HBO Max and in theaters, drawing outrage from a number of high profile directors. 2020 was one of the most hectic years in film history, as the coronavirus pandemic swept the world bringing movie production to a grinding halt and delaying almost all major 2020 films until 2021 or later.
In an effort to salvage its delayed movie slate and drive subscribers to HBO Max during another uncertain box office year, WarnerMedia took drastic action, making the decision to send all of WB's movies to HBO Max without even consulting the directors. Needless to say, the decision drew strong backlash despite consumer . Directors like Christopher Nolan and Denis Villeneuve painted WB and parent company AT&T as greedy, claiming they were unceremoniously bringing an end to theaters without giving them a fighting chance.
In addition to the outrage from directors and other talent, theater owners, the DGA, and other organizations have also condemned the deal, with some even threatening legal action or other sanctions. While its understandable why many people may take issue with AT&T's actions, especially given the way the decision was made, the criticisms are also missing the point and ignoring a few important realities about the state of the industry and the details of the HBO Max deal.
HBO Max Made a Necessary Business Decision
Warner Bros. had hundreds of millions of dollars invested in movies originally slated to release in 2020 and had budgeted for some level of box office returns from all those film, only for the box office to dry up almost entirely, leading to one of the worst years in box office history.
The fear of coronavirus shut down a significant portion of theaters around the world, making it illegal to attend movie in public in many places, with many others simply being closed out of their own safety concerns, or due to a lack of potential business while customers stayed home in social isolation. Even the theaters that were open saw minimal business, in some cases losing more money by opening than they would have just to stay closed altogether.
While the international box office is picking back up, and vaccines are being approved, 2021's outlook doesn't look drastically better. It'd certainly be hard to be worse than 2020, but audiences aren't likely to rush back to movie theaters immediately or all at once, even with the vaccine, and WB can't delay its movies anymore.
With streaming revenue already ing box office revenue before the pandemic even started, it's essential for WarnerMedia to get HBO Max to grow as fast as possible, so combined with box office uncertainties, putting the movies on HBO Max seems like a logical move. It may not be the best-case scenario for movie theaters, but they also need content in order to sell tickets, so Warner Bros. having the financial stability to fund more projects is also in their best interest.
Why Everyone's So Mad About Movies Going to HBO Max
While the pressure (and appeal) of the decision make a lot of sense, the outrage from directors like Nolan and Villeneuve is also understandable. Nolan is one of the most outspoken advocates of the theatrical experience, so anything that threatens theaters is bad for him. Nolan certainly isn't demanding theaters throw caution to the wind and open up instead, but as he noted after Tenet's release, there was a lot to learn from how Tenet performed around the world, so he may hope there are better alternatives
Besides the threat to theaters, directors like Denis Villeneuve and other actors, directors, producers, and more involved in these movies signed on under the expectation of a theatrical release, many of them g contracts promising a percentage of box office revenue or other performance bonuses. To them, it doesn't matter if the deal is necessary, it's totally violating their expectations for release when they signed on, possibly even representing a breach of contract. Some directors are even threatening to boycott WB. Since the decision was made without consultation, a lot of people are going to be upset, even if they understand the economics behind the call.
The deal may also have a significant impact to other cast and crew who expect residuals outside of directors. Hopefully Warner Bros. is able to find a way to compensate them appropriately under the streaming model. It may be necessary to release the movies on streaming, but that wouldn't make it acceptable to cut the pay of the cast and crew.
Nolan and Villeneuve Are Missing the Point
Christopher Nolan and Denis Villeneuve had particularly strong words for HBO Max, but both are unfortunately missing the point. First of all, both of them made statements implying these movies would no longer be in theaters at all, which isn't the case. Not only will they all be simultaneously released in theaters and on HBO Max, but they will actually only be available on HBO Max for one month before returning to theatrical exclusivity before going to VOD and eventually back to streaming again.
Related: WB's 2021 HBO Max Release Strategy is The Smartest Option
Also, HBO Max is only available in the United States right now, where box office has been especially poor. In fact, the international box office hasn't been nearly so bad, which Christopher Nolan should know, as Tenet made over $300 million outside the U.S.. It'd be ignorant to say this won't have any impact on theaters, but it's certainly giving them a fighting chance.
Of course, we also have to consider that a lot of the outcry could be merely performative. As two of the most respected working directors and champions of the theatrical experience, they can't just allow WB to make such a sweeping decision without doing their own posturing in return. Judd Apatow said the decision was disrespectful, and it's understandable how it could be seen as a slap in the face to directors accustomed to operating with high levels of control over these aspects of their movies.
There's also the fact that all the talent involved in this decision will have to sit at a negotiating table with WB again sometime in the future, and allowing the studio to make sweeping unilateral decisions that impact the deals with actors and directors without major blowback doesn't set a good precedent.
Why WB Didn't Tell Anyone About the HBO Max Deal Ahead of Time
The economic necessity of the decision to simultaneously release the movies on HBO Max is easy to grasp, but complaints over the lack of consultation, with many getting no more than a 30-minute heads up, and others like Villeneuve finding out when the announcement hit the media, are more than understandable. While AT&T and WarnerMedia are the primary decisionmakers, as they're funding the bulk of productions, decisions about streaming or release dates aren't typically made without consulting of directors and producers, so on top of being against the wishes of some, like Nolan is a bit of a slap in the face.
Regardless of whether Warner Bros. should or shouldn't have consulted with directors first, the industry reaction to the news reveals why WarnerMedia thought it was best to keep it a secret. It's clearly something they were set on doing despite the predicted backlash, and making opponents of the decision aware of the decision ahead of time could have given them a chance to block it from happening at all, the perfect example of "asking forgiveness, not permission," only AT&T isn't actually apologizing, spinning to focus on the positives to consumers.
How the HBO Max Deal Will Impact the Cinematic Experience
The first thing to note about theaters is that they're only a venue. Yes, there's a long and storied theatrical tradition, but theaters dying doesn't mean movies are dying. And as long as there's movies, there'll be theaters, they just might need to undergo some drastic change to be more competitive with the convenience of staying home to watch streaming content. That lack of competitiveness was already causing attendance to wane before the pandemic.
Those changes might mean there are fewer theaters with fewer screens and they focus on mostly truly big-screen event movies, which drive most of the box office anyway. While that sounds like a harsh reality for anyone who preferred catching smaller indie movies on the big screen, movie theaters are playing too many movies in front of empty audiences to justify the number of screens some multiplexes have. We could also see more movies premiere on streaming only to get bumped up to a theatrical release if it proves popular enough.
We could also see more directors taking a page out of Kevin Smith's book and abandoning the traditional theatrical release model. Smith instead took Jay and Silent Bob Reboot on tour with a roadshow featuring a Q&A after the movie, which actually helped The Jay and Silent Bob Reboot set a new record for highest per-screen average. The roadshow model would only truly pay off with much lower budget movies, but it's a great example of how some theater experiences may need to change for the industry to survive.
One thing that's certainly not at risk are big-budget movies. In fact, we may even see a spectacle arms race where streaming services try to put out the biggest movies to draw customers. Due to the difference of the streaming model, it could eventually make bigger budget movies even bigger. WarnerMedia CEO Jason Kilar even said enough subscriber growth could one-day justify $1 billion budgets, which is something that'd certainly necessitate a big-screen experience.
Ultimately, movie theaters will be around as long as there's movies, but the industry as we know it today has been on its way out for a long time. Warner Bros. and AT&T may have contributed to accelerating their decline, but considering most theaters were closed for the majority of 2020. It's understandable why the likes of Christopher Nolan and Denis Villeneuve are upset - especially considering how it went down - and why they'd feel an obligation to stand up for the theater industry, Warner Bros. was also between a rock and a hard place and decided to make the hard decision. Hopefully everyone's still able to benefit from it.
