Is streaming bad news for Hollywood?

Lifestyle | 13 Apr |

Streaming is taking America by storm – and it’s even taking home Oscars.

Nearly 60 percent of Americans have some form of streaming service, and over half of U.S. streamers subscribe to Netflix. As streaming dramatically changes the media habits of Americans, its disruption of an American tradition – Hollywood filmmaking and the Academy Awards – is making waves.

Iconic film director Steven Spielberg is pushing for a rule change that would prevent Netflix from duplicating the statues it got in February in next year’s Academy Awards. The Netflix film “Roma” took home three Oscars. To do that, it met existing Academy rules while simultaneously putting the movie out on its worldwide streaming platform. 

Spielberg and others say the industry’s highest honors have always been a competition among studios that make movies for theatrical release.

“Most studios don’t have a platform that enables instantaneous, worldwide release,” says author Meredith Jordan, whose book, Below The Line: Anatomy of a Successful Movie, provides a rare behind-the-scenes look at the making of an A-list Hollywood film. “The issue isn’t whether Netflix can compete as a studio. It just needs to compete as a studio, without using the tools of its larger streaming business.”  

Currently, Academy rules stipulate that a movie needs seven consecutive days in theatrical release in either New York or Los Angeles to qualify for award consideration.  Spielberg reportedly seeks a change that would require a one-month theatrical release. 

“It’s not unreasonable to think about streaming in the context of what happened when television went mass market,” Jordan said. “If this were 1975, ‘Roma’ would be a truly outstanding made-for-TV movie being put on one of the major networks while also going into theaters for a couple of weeks, and then qualifying for competition as a feature. 

“The Academy periodically updates its rules to address cultural shifts, most recently in 2012,” she said. “This is one of those times.”

Jordan says streaming’s disruptive impact on Hollywood and modern media in general comes down to three main factors:

Building massive scale in subscribers and content. Netflix is rapidly approaching 150 million subscribers. Continually increasing capital allows Netflix to create tons of content. Last year, Netflix reportedly spent over $10 billion on new content. “They say ‘Roma’ cost $15 million to make and Netflix spent more than three times that advertising ‘Roma’ for the Oscars,” Jordan said. “Most studios use traditional marketing and distribution methods, and then later make additional advertising spends to promote a movie in contention.”  

• Luring big stars. “Netflix is playing a different game,” Jordan says. “It’s outbidding studios for top talent. While it doesn’t provide the back-end perks of traditional studio deals, Netflix replaces those with generous upfront payments.” In 2018, Netflix’s original films included starring roles by Will Smith, Sandra Bullock, and Jennifer Aniston.

• Having distribution control. A subscriber-based business model at a relatively low fee has been a huge key to Netflix’s and other streamers’ success, providing what industry observes say is better customer value than TV or cable. “By owning the direct relationship between customer and content, Netflix and other subscription-based streamers have a big advantage over TV, which is predicated on advertising,” Jordan says. “That’s something studios don’t have. Netflix is making movies as a studio and then using its role as a platform to promote those efforts. That isn’t fair, at least not for the Oscars.”  

“Streaming had already put most of the media incumbents – Hollywood, TV and cable – into a state of chaos,” Jordan says. “The Oscars – a very big stage – amplified that.”

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