The exec in charge of HBO Max breaks down the Hollywood-shaking decision to release all 2021 Warner Bros. movies to streaming and theaters simultaneously: 'Predictability is at a premium'
- Warner Bros. announced on Thursday that all of its 2021 movies will debut on HBO Max the same day they hit theaters in the US.
- The EVP of direct-to-consumer at WarnerMedia, Andy Forssell, talked to Business Insider about the unprecedented decision sparked by the pandemic.
- "It's a very stable thing and there's a lot of value in that," he said. "Predictability is at a premium right now."
- And as to whether the move could spark permanent change, Forssell said that anyone who "says they know anything about 2022 aren't being straight with you."
- Visit Business Insider's homepage for more stories.
Warner Bros. announced on Thursday that its entire 2021 slate of movies will debut on HBO Max the same day they hit theaters in the US, an unprecedented step as the coronavirus pandemic continues to upend Hollywood.
It's a blow for movie theaters but could supercharge growth for HBO Max, the company's streaming competitor to services like Netflix and Disney Plus.
The movies will be available to stream for one month before leaving and playing exclusively in theaters. They include major tentpoles like "The Suicide Squad," "The Matrix 4," "Godzilla vs Kong," "Dune," and the third "Conjuring" film. They'll play exclusively in international theaters as intended, as HBO Max is only available in the US.
The announcement comes after WarnerMedia itself, the studio's parent company, underwent a significant shakeup that emphasizes its streaming business and its centerpiece: HBO Max. That included creating a new HBO Max operating business unit overseen by HBO Max general manager and WarnerMedia EVP of direct-to-consumer, Andy Forssell.
In an interview with Business Insider, Forssell touched on the difficult place the pandemic has left major media companies that led to the Warner Bros. announcement.
"Any big media company has been talking to experts trying to project what the future looks like week by week for the past six months," Forssell said. "In the last month, we started looking at our options in even greater detail. This was the best option for exhibitors, viewers, and our partners across the board."
Forssell said that there would be a "glut of content" in theaters without the streaming option.
"In the sunniest projections, you get a year's worth of movies jammed into half a year," he said.
A person with knowledge of Warner Bros.' strategy said that while the studio is bullish on the prospects of returning to theaters, it didn't like the unpredictability of A) not knowing how long its movies would sit on the theatrical shelf and B) once theaters are fully operating again, how long it will take for audiences to feel comfortable returning.
Read more: In a major blow to US theaters, Warner Bros. announces that all of its movies in 2021 will debut on HBO Max the same day they arrive in cinemas
But though Forssell characterized the move as the best option, it is likely to anger the big movie-theater chains.
AMC Theatres, the world's largest theater chain, released a statement on Thursday following the announcement, saying in part: "Clearly, WarnerMedia intends to sacrifice a considerable portion of the profitability of its movie studio, and that of its partners and filmmakers, to subsidize its HBO Max startup. As for AMC, we will do all in our power to ensure that Warner does not do so at our expense."
AMC's stock was down 16 percent following the announcement.
When asked about deal terms with exhibitors, Forssell declined to comment "out of respect for" WarnerMedia Studios and Networks chair Ann Sarnoff and Warner Bros. Picture Group chair Toby Emmerich.
The move is a big pivot for Warner Bros., which released "Tenet" to theaters in September hoping to spark the return of the theatrical experience after cinemas had been closed for nearly six months. While the movie has grossed more than $350 million globally, it disappointed at the US box office.
Regarding "Tenet," Forssell acknowledged that it opened in "a tough environment and it is what it is." But he emphasized that the 2021 strategy had less to do with "Tenet's" performance and was more about supporting the entire entertainment "ecosystem."
"It supports the ecosystem," he said. "It's a very stable thing and there's a lot of value in that. Predictability is at a premium right now."
But speculation about the future, even beyond 2021, has already started.
Brooks Barnes, the Hollywood reporter for The New York Times, tweeted: "WarnerMedia is calling this a 'unique one-year plan.' But there will be no going back. HBO Max needs the content and consumers will not just say 'oh, okay' when they can't have instant access anymore."
The Hollywood Reporter's Borys Kit tweeted: "WB can call this a 'unique one-year plan' but don't kid yourself, this is their plan for the future."
Forssell said that anyone who "says they know anything about 2022 aren't being straight with you."
"We're open to anything but right now we have to get through 2021," Forssell said. "In six months we'll have more visibility. As a viewer I expect to go to theaters for a long time to come. The audience will tell us what form that takes."
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