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>The only thing that makes movies economical is theatrical releases. Ah no. Home releases have been for very long the single biggest profitable part of a movie

>The only thing that makes movies economical is theatrical releases. Ah no. Home releases have been for very long the single biggest profitable part of a movie's life cycle. That's why Netflix doesn't waste its time with theatrical unless it has to, ie when they employ Scorcese and he puts in his contract, I'm assuming. https://stephenfollows.com/wp-content/uploads/2016/07/how-movies-make-money-Average-income-for-Hollywood-blockbuster-700x286.png https://stephenfollows.com/wp-content/uploads/2016/07/how-mo... https://stephenfollows.com/how-movies-make-money-hollywood-blockbusters/ https://stephenfollows.com/how-movies-make-money-hollywood-b...

jmyeet 3y ago
First, that's 2016. The central point there is how the fall in physical media sales is hurting movies. That trend has continued. I found something else suggesting DVD and BluRay sales were now about 2/3 of theatrical earnings where it used to exceed it. And that was a problem. Second, from the article: > Video on Demand performed very poorly for these blockbusters, with almost half of the films earning under 1% of their total income from VOD. So the digital home entertainment income is revenue from jsut having the content available on Netflix, Hulu or whoever. Third, even here 20%+ of the revenue came from theatrical release. Given how much a concern there is around the decline in physical media sales, losing that 20% seems like a far bigger deal, which is my point. Netflix basically loses that 20% off the bat. Fourth, these are averages. There is a long tail in theatrical earnings where the biggest blockbusters can make over a billion. By having streaming-only income you basically lose all your blockbuster potential. Lastly, just speculating here but as soon as the windows come down between theatrical release, paid VOD release and streaming release come down, it hurts all theatrical and paid VOD release revenue because a lot of people will just wait. This comes into play with simultaneous streaming and theatrical releases, which seem to make even less economic sense.
- kranke155 3y ago
  Then what's your theory why Netflix is not doing theatrical, if, like you say, it's just a missed opportunity ?

jmyeet 3y ago

First, that's 2016. The central point there is how the fall in physical media sales is hurting movies. That trend has continued. I found something else suggesting DVD and BluRay sales were now about 2/3 of theatrical earnings where it used to exceed it. And that was a problem. Second, from the article: > Video on Demand performed very poorly for these blockbusters, with almost half of the films earning under 1% of their total income from VOD. So the digital home entertainment income is revenue from jsut having the content available on Netflix, Hulu or whoever. Third, even here 20%+ of the revenue came from theatrical release. Given how much a concern there is around the decline in physical media sales, losing that 20% seems like a far bigger deal, which is my point. Netflix basically loses that 20% off the bat. Fourth, these are averages. There is a long tail in theatrical earnings where the biggest blockbusters can make over a billion. By having streaming-only income you basically lose all your blockbuster potential. Lastly, just speculating here but as soon as the windows come down between theatrical release, paid VOD release and streaming release come down, it hurts all theatrical and paid VOD release revenue because a lot of people will just wait. This comes into play with simultaneous streaming and theatrical releases, which seem to make even less economic sense.

kranke155 3y ago
Then what's your theory why Netflix is not doing theatrical, if, like you say, it's just a missed opportunity ?