nScreenMedia OTT multiscreen media analysis

Spielberg wants the Oscar, Netflix taking the audience

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Steven Spielberg says movie streaming services like Netflix shouldn’t get Oscars and Cannes won’t let it get a Palme d’Or. Reed Hastings, Netflix CEO, probably isn’t that upset. After all, he has the audience.  

Cannes bans Netflix

Netflix movies are not eligible for a Palme d’Or at this year’s Cannes movie festival. Last year there was uproar at the inclusion of two Netflix movies – Okja and The Meyowitz Stories – in the competition. Critics complained Netflix “ploy” of releasing a movie in few theaters for a week or so to qualify for the competition was not in the spirit of the industry.

Apparently, the organizers of Cannes were listening. The board changed the rules for inclusion in the 2018 competition:

“Any film that wishes to compete in competition at Cannes will have to commit itself to being distributed in French movie theaters.”

Thierry Fremaux, Cannes festival head, said he hoped this would persuade Netflix to comply with the requirement. It did not. Mr. Fremaux went on to try and draw a distinction between films created by SVOD services and films targeting movie theaters. He claimed SVOD films are more like a hybrid between a film and television show.

No Oscars for Netflix?

The same complaints about Netflix were echoed by none other than Steven Spielberg in an interview with the UK’s ITV News:

“Once you commit to a television format, you’re a TV movie. If it’s a good show, you deserve an Emmy. But not an Oscar.”

He also complained that releasing a movie in a couple of theaters for less than a week was just a “token.” It should not qualify a movie for an Academy Award.

The difference between a TV and movie screen

Trying to define a difference between two screens is something we have seen before. The television industry tried to control which screens its content could and could not be seen on. For example, Comcast refused to authenticate apps running on TV connected devices, seeking to reserve control of the TV experience for itself. The battle is largely over. Television providers are growing ever more comfortable with allowing consumers to decide the best viewing environment for them.

Not everyone in the movie industry buys into the differentiation between screens. UK arthouse movie chain Curzon releases many independent movies in its theaters and through its app on the same day. According to Curzon Managing Director Philip Mordecai, this strategy has not damaged the theater business and expanded the audience for the movies. He recognizes that there is a difference in experience between the theater and television experience but allows his customer to decide which works for them.

This is something the rest of the film industry cannot bring itself to do. It has talked about a premium VOD window for movies, allowing customers to watch a film in the later part of the theater run. However, it lacks the will to make it happen.

Film industry circles the wagons around theaters

Mr. Spielberg recognizes that the film industry has a serious problem:

“A lot of studios would rather make branded, tentpole, guaranteed box office hits, than take chances on smaller films.”

He went on to say those smaller filmmakers are increasingly going to Hulu, Netflix, and Amazon. He added, however, that he would continue to make movies like The Post for theaters.

Unfortunately, the movie industry’s problems go far deeper than eschewing smaller movies. For example, major studios like Disney are making tentpole movies like Star Wars far less profitable for theater owners than they used to be. Without the smaller movies, can many theaters even survive?

Meanwhile, audiences are increasingly exchanging time they used to spend watching movies by bingeing addictive shows on Netflix and HBO Now. Netflix’ success highlights the biggest problem the movie industry must face of all. There are plenty of close substitutes for its product readily and cheaply available to consumers through SVOD services. What’s more, the television screen is a great place to enjoy it all.

Why it matters

The traditional movie industry is trying to shut Netflix out of major awards like the Oscars and Cannes.

The industry is trying to draw an artificial distinction between the theater screen and a TV screen.

Consumers are voting with their eyes, watching fewer movies and more SVOD originals.

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