Just like the rest of society, there may not be a return to what was once normal.
To hear studio executives tell it, they turned to Premium VOD and streaming during the Covid-19 quarantine only out of necessity. Movies like Trolls: World Tour, The High Note, Artemis Fowl and others were pulled from the theatrical schedule and released on home video platforms because the studios had no other available choices. Theater owners, as well as NATO, made various statements about how they would remember how studios have turned against them, but most of those statements seem to have faded in intensity over time.
During a virtual CineEurope presentation, more studio heads made more comments about how excited everyone was about theaters reopening, confident that audiences are itching to get out of the house and see movies on a *real* big screen again.
That belief seems to be rooted in the basic idea that not only are behaviors ripe for changing but that outlets for that changed behavior will be available. Neither may actually be the case.
One study from Google indicates that consumer habits that have been evolving over the years may have taken firmer hold during the Covid-19 shutdowns across the country, meaning people are less likely to venture out and about for their shopping and entertainment fixes. In some ways that may be tied to bigger shifts across society and within the economy, including the higher frequency of someone working from home, the newfound love of cooking for themselves and more.
Those shifts as they relate to streaming behavior are expected to be represented at this year’s Newfronts as media companies make their virtual presentations to advertisers, positioning those platforms as the place where people are and they need to be. Spending on streaming entertainment isn’t expected to fade anytime soon either. There may be some level of subscription fatigue happening, but that’s likely only because people dipped their toe in so many different pools during the early days of stay-at-home orders, taking advantage of free trials or deciding now was when they were finally going to watch “The Handmaid’s Tale” and then cancel Hulu after finishing it. So it may be that these behaviors have now become entrenched in many households.
Add to that the ever-changing landscape of the theatrical industry, one that is already working from a deficit in part because the issue of wearing masks has become one with all sorts of political implications and beliefs. Add to that the recent shift of both Tenet and Mulan to August and it’s clear the summer movie season has all but vanished. There may be a few titles that still come out in drive-in locations and the handful of theaters in states that have done a better job of containing outbreaks, but that’s it.
In short, there’s a great deal of uncertainty about what’s next for the public health crisis we’re in the midst of and what the retail response to that is going to be. Texas and Florida are reversing course and closing bars again, while other states like Illinois are doing alright and slowly reopening more and more businesses.
It won’t take much for premium VOD to become much more popular than it already is. Really it seems to come down to 1) Price, and 2) Selection. If Wonder Woman 1984 were available to rent day-and-date with theaters, it would be massive, especially if that rental were just $9.99. To date the titles have been kids films and mid-tier dramas, but a blockbuster at a reasonable price would be a game-changer, one that could potentially blow the market wide open. That price point would be a stark contrast to the cost of taking a family to the theater, including the sunk time in driving etc that goes with it.
Premium VOD may never land as big a fish as WW84 or Black Widow, but it’s very likely it becomes a regular part of studio’s release planning, especially for the kinds of titles that are felt to have only moderate potential for theatrical success. Even so, that price point will have to come down, especially on the kids titles where the value for parents is in repeat viewing.
It won’t be long given the continued issues around what businesses are or aren’t open and what the protocol is for visiting them before the behavior around staying at home and bringing the world there solidifies even more than it already has. Studios will have to adapt to that, as will the theater owners who have been avoiding this conversation for over a decade.