With The Possibility Of Theaters Closing For Good, Streaming May Become Our New Normal.
Due to the widespread outbreak of COVID-19, social distancing along with the ongoing quarantine WarnerMedia is “rethinking our theatrical model". This was recently stated during the media giant’s first quarter earning call. There wasn’t much offered up in the way of details when it comes to that statement, however it must be related to the pressure the movie theater industry is currently facing.
Theaters are hoping to open back up in July but top executives are not very optimistic with AT&T COO John Stankey stating “Don’t expect that this is going to be a snap back recovery.” Stankey also added “I think that’s going to be something that we’re going to have to watch, the formation of consumer confidence, not just about going to movies, just in general about being back in out in public.”
At home releases very well may be the future for new releases, as we saw Universal and Disney recently release Trolls World Tour which has gone on to make 50 million in video on demand sales. It is assumed that other film companies are contemplating releases via video on demand in their business strategy especially with no end in site to the COVID-19 quarantine. AT&T the parent company of WarnerMedia reported a 24% plunge in theatrical movie revenue in the first quarter.
Prior to the release of these figures WarnerMedia announced that HBO Max will launch on May 27. Streaming has seen a huge uptick in recent months and companies are hoping these services will help make up for recent losses. In February, WarnerMedia announced the creation of Warner Max which will produce “a steady stream of high-quality and highly curated original film”. There will be 8 to 10 annual titles tailored to streaming. With the creation of HBO Max and Warner Max films that were originally slated to be released in theaters can very well be repurposed for streaming. Only time will tell the fate of the theater industry, and if streaming will rise and take it's place permanently.