SONNY BUNCH: Customers Have a Say in What Gets Made Too.
What was most intriguing about the Harper’s piece was what was missing. At first, I thought I’d accidentally skipped over a section. But then I did a command-F and realized, no, I was right. There’s no mention, at all, of the pandemic. Or of Covid. Or of lockdowns. Or the resultant boom in streaming content as studios rushed to sate the desires of audiences stuck at home. Or the resultant theatrical crash as local and state governments kept theaters closed in New York and California, crushing the ability to distribute films domestically and putting the entire theatrical economic ecosystem at risk.
Audiences were already turning to streaming, for sure—note the rapid decline in DVD and Blu-ray sales in this post’s chart titled “U.S. Home Entertainment Market by Category” that begins in 2008, right around the same time Netflix introduced streaming—but the lockdowns undoubtedly hastened the process. Every studio decided at the same time they needed to build up a subscriber base NOW NOW NOW, and they were happy to pay handsomely to do it. How do we know they paid handsomely? Well, the screenwriters were putting up what appeared to be record-breaking numbers, as best as we can tell from WGA dues collected in 2023.
Speaking of the collapse of physical media, this is another key factor in the evolution of the business of Hollywood that gets short shrift in the feature. I don’t think you can fully understand the hard turn to IP and the reliance on foreign box office grosses in the form of big-budget spectacle without grappling with the collapse of DVD and home video alongside the increase in advertising costs that accompany every movie opening on 2,500 or more screens. It’s harder to recoup the cost of a mid-budget movie if you don’t have an extra eight figures of disc revenue coming in for every movie with Matt Damon in a courtroom on the cover. As much as it pains me to say this as a physical media die-hard, most folks are content not owning anything so long as they think they can stream it whenever they want. Customer behavior matters.
In 2010, James Cameron told the Washington Post that DVDs were bad for the Gaia and other living things, and needed to be eliminated (while simultaneously having multiple versions of Avatar coming out that same year on DVD):
It’s a consumer product like any consumer product. I think ultimately we’re going to bypass a physical medium and go directly to a download model and then it’s just bits moving in the system. And then the only impact to the environment is the power it takes to run the computers, run the devices. I think that we’re not there yet, but we’re moving that direction. Twentieth Century Fox has made a commitment to be carbon neutral by the end of 2010. Because of some of these practices that can’t be changed, the only way to do that is to buy carbon offsets. You know, which again, these are interim solutions. But at least it shows that there’s a consciousness that we have to be dealing with carbon pollution and sustainability.
And yet, if you’re part of the Cult of Greta, going all-streaming is a very bad tradeoff. Just ask the Grauniad: Streaming’s dirty secret: how viewing Netflix top 10 creates vast quantity of CO2.
Related: John Nolte: Refusal to Release Subscriber Numbers Means Netflix Likely Peaked. “Streaming is merit-based. We will only purchase your product if we like your product. Netflix has so far trounced the competition, but the days of Hollywood making money producing content no one watches are thankfully coming to an end. With cable TV, it was easy to raise revenue by raising prices. The customer had nowhere else to go. That’s not the case with streaming. Wall Street and Hollywood are looking at peak Netflix and gulping.”