Warner Bros. announced Thursday that it will make all of its movies slated for release in 2021 available to stream for one month only, exclusively on HBO Max. Every film will be simultaneously released in theaters and available for a limited time on the streaming service.
The new hybrid model represents a novel deviation from the typical program studios follow, where films are released in theaters first, and then hit other platforms months later.
"WarnerMedia succeeded in making day and date theatrical and streaming a reality, something Netflix has been trying to accomplish, unsuccessfully, for years — this is a huge win for consumer choice," said Rich Greenfield of media research firm LightShed Partners. "Legacy media has always tried to dictate how you consume their content — now the consumer is in control."
Movie theater stock prices fell on the news. AMC shares dropped more than 15 percent, while Cinemark was down 14.5 percent.
The move comes as theaters continue to close in many markets because of the Covid-19 pandemic. In U.S. markets where theaters have reopened, sales and attendance have not matched pre-pandemic levels.
After the one-month period on HBO Max, the films will be taken off the platform and shown only in theaters in the U.S. and internationally. HBO Max and Warner Bros. are both owned by WarnerMedia, which in turn is owned by AT&T.
The first movie to be released using this model will be "Wonder Woman 1984" this month. Among the movies expected to be released this way next year are "Godzilla vs. Kong," "Tom & Jerry," "In The Heights," "Space Jam: A New Legacy," "The Suicide Squad," "Reminiscence," "Malignant," "Dune" and "Matrix 4."
“We’re living in unprecedented times, which call for creative solutions, including this new initiative for the Warner Bros. Pictures Group,” said Ann Sarnoff, chair and CEO of WarnerMedia Studios and Networks Group. “No one wants films back on the big screen more than we do. We know new content is the lifeblood of theatrical exhibition, but we have to balance this with the reality that most theaters in the U.S. will likely operate at reduced capacity throughout 2021."
WarnerMedia CEO Jason Kilar said in an interview Thursday with CNBC that the decision to pursue a hybrid release model was related to the pandemic — but that he was optimistic people would eventually return to theaters.
“That’s why we’re doing it. We haven’t spent one brain cell on what the world looks like in 2022," Kilar said. "I have conviction that for the next several decades there will be a very large volume of consumers worldwide that will choose on any given night, especially a Friday or Saturday night, to go out to a theater to be entertained by a great Warner Brothers movie."