The Growing Pains Around Netflix’s Growth Into a Movie Industry Player

Netflix has long made inroads into traditional television—largely without incident, as many of its most popular shows have helped to define the cultural zeitgeist—but when it comes to the film industry, the tech-turned-media company has proven somewhat harder to love.

That discomfort was felt at CinemaCon this week, where the streaming service—whether by name or by implication—was a primary topic of discussion among the audience, including members of the organization putting on the event, the National Association of Theatre Owners. NATO’s members, mostly theater chains, have a vested interest in the traditional big-screen cinema experience. John Fithian, its president and CEO, came up in defense of the traditional release window in his comments at the event.

“All we ask is that powerful movies in all genres, made by content creators who want their work on the big screen, be given the time to reach their full potential in theaters before heading to the home,” Fithian said, according to Variety  (opens in a new tab). “Theatrical exhibition is the keystone of this industry, and there is no replacement—both artistically and commercially—for the impact of a break‐out hit.”

(It’s not the only recent debate about tech that has caused issues for the group—just ask them about MoviePass.)

The release window issue, mixed with Netflix’s increasing prominence, is creating some strange situations in the film industry at the moment, with associations at times in the middle.

Earlier this year, the Motion Picture Association of America (MPAA) welcomed Netflix as a member, a move considered unprecedented at the time, and the service’s films received multiple nominations at the Academy Awards this year, with its high-profile Roma winning three Oscars.

But weeks after those wins, famed director Steven Spielberg, a board member of the Academy of Motion Picture Arts and Sciences, courted controversy among film fans  (opens in a new tab) by formally supporting a petition to the Academy that would exclude streaming services from awards consideration without an exclusive theatrical window of at least four weeks, arguing that films produced for television are fundamentally different. Spielberg’s cause, which faced viral pushback, received a setback this week, however, when Variety revealed  (opens in a new tab) that the Justice Department sent a letter to AMPAS CEO Dawn Hudson warning that such a stance, if approved by the board, could face antitrust scrutiny.

“In the event that the Academy—an association that includes multiple competitors in its membership—establishes certain eligibility requirements for the Oscars that eliminate competition without procompetitive justification, such conduct may raise antitrust concerns,” the Justice Department’s Makan Delrahim wrote to Hudson.

(The Academy said it had responded to Delrahim and would look into voting on the issue at its board meeting later this month.).

CinemaCon reflected this broader tension between tradition and technology, but Netflix did have its defenders, among them MPAA Chairman Charles Rivkin, who argued that for all of Netflix’s differences, it shares a large amount of DNA with film studios, and its rise reflects the fact that “how we pursue our mission of promoting and protecting creativity is evolving.”

He added that there was much that could be gained in making Netflix an equal collaborator.

“Here is what I know: We are all stronger advocates for creativity and the entertainment business when we are working together,” he said, according to The Washington Post  (opens in a new tab). “Change is not always easy, but it takes us forward.”

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