Warner Bros. Pictures announced on the 3rd that all its films in 2021 will be released simultaneously in physical cinemas and HBO Max streaming platforms, including action blockbusters such as Matrix 4 and Godzilla vs. King Kong. As soon as the news came out, the stock prices of many physical cinemas in the United States plummeted.
According to past practice, at the beginning of the release of a blockbuster in the United States, the audience can only go to the physical cinema to have a look. The new film will not appear on the streaming media platform until about 90 days after it is released. However, the coronavirus has hit the box office of physical cinemas in the United States, prompting Warner Bros. to find another way to save itself.
“We know that new films are the lifeblood of physical cinemas, but the reality is that most U.S. theaters won’t be able to run at full capacity for 2021, and we have to find a balance between [protecting physical theaters and getting profits],” said Ann Sarnoff, a Warner Bros. executive.
Following Warner Bros.’ announcement, the share prices of several American theaters plummeted. For example, the share price of the American theater chain fell by about 16%, the share price of Hemanke Studios plummeted by about 22%, and the share price of AT&T, which owns Warner Bros. Pictures and HBO, rose slightly.
According to Jeff Bock, a senior analyst at the North American Theater Alliance, Warner Bros.’ latest move means that the U.S. film industry, especially physical cinemas, has been hit by “the biggest earthquake”, and the overall industry pattern may change forever.
Sarnov said that the simultaneous release of the new film in physical cinemas and streaming platforms is a “temporary measure” and tentatively scheduled for one year. By doing so, Warner’s new film will be released simultaneously in cinemas and HBO Max streaming for one month, and then withdraw from the streaming platform and continue to be released in theaters only.
Currently, only US users can subscribe to the HBO Max streaming platform. In other parts of the world, Warner Bros.’ new film next year will still be launched only in physical cinemas. Subscriptions to the HBO Max streaming platform may expand to Latin America and parts of Europe in the second half of next year, AFP reported.
In recent years, physical cinemas in the United States have been constantly challenged by streaming platforms. According to the National Association of Cinema Owners, the average total price of two movie tickets in the United States in 2019 was $18.22, while the monthly subscription price of the HBO Max streaming platform was only $15. More and more viewers prefer the experience of “running less and spending less” sitting at home watching blockbusters.
As a competitor of Warner Bros., the Walt Disney Company has also recently moved some films from physical cinemas to Disney+ streaming platforms for release. The Associated Press reported that the Walt Disney Company expects to disclose more details of its plan involving streaming movies on the 11th of this month.