Corporate heavyweights in the film industry are testing their own streaming services and there will be some casualties, according to Majestic Cinemas chief executive Kieren Dell.
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The in-demand streaming services such as Netflix, Amazon and Apple suddenly have competition from the very industry supplying them with their biggest blockbuster films.
Disney Plus, owned the Walt Disney Company, was quick to the subscription service party after launching in Australia in November 2019.
Viacom CBS subscription service, Paramount Plus, was launched in the US, Canada, and Latin America on March 4 this year and will go live in Australia in August.
"The reality is that there is a streaming and content war going on, and it's all about who owns what content," Mr Dell said.
"Universal are setting up Peacock in the US, Paramount are rebranding CBS Online as Paramount Plus, you've already got Disney Plus. There is HBO Max available in the US, owned by Warner Bros.
"The main streaming players are Netflix, Amazon and Apple who are producing some of their own content now, but basically the key media conglomerates are taking back their major content from those streaming players. That is the content war going forward.
"There are eight big streamers all competing for the consumer dollar, but no-one has subscriptions for all eight so there will definitely be some casualties there."
Cinema has always survived through technical innovations like TV, then colour TV, then home video and DVD, and it will again because it offers something you just can't replicate at home.
- Peter Howard
Mr Dell said film industry players like Disney have also been testing their reliance on cinema during the pandemic, but found surprising results.
"The superhero film Black Widow for example was released for $35 on Disney Plus or you could watch it in cinemas at the same time," he said.
"But, the figures are saying that Disney took $60 million sales online and took $215 million in cinemas, not including in China.
"There are new problems because Black Widow has dropped significantly in its second week, they have missed those delayed viewers they could have gotten in a month's time and piracy for Black Widow has shot through the roof because it was released online.
"Unfortunately studios making a film for $200 million, then putting it on a streaming service to make $60 million is not going to pay the actors, directors and costs involved."
Film studios are realising that online piracy is widespread and the profits aren't there, according to Mr Dell.
"The new streaming services have tested a number of things during the pandemic and that has been interesting to see, but blockbuster movies still make their most money in the first three weeks in cinemas," he said.
"It's a complicated ecosystem and there has been an impact with COVID-19 around the world on cinemas.
"These new services are changing the content that comes to cinemas, there is a shift towards big blockbusters for theatre release because the middle size dramas and movies are going straight to streaming or being turned into an eight hour series.
"There is going to be some interesting interactions along the way but cinemas and streaming are part of the same ecosystem and will likely co-exist."
According to Peter Howard, who operates Great Lakes Cinema 3 in Tuncurry and Fays Twin Cinema in Taree, the rise of streaming services was inevitable but had been markedly brought forward by COVID-19 and people being locked down in their homes for significant periods of time.
"COVID really ramped up people cocooning at home which helped streaming services immensely," Mr Howard said.
"However, we have seen that people will come back to the cinemas in big numbers when they feel safe, and the movies are there that they want to see.
"We were trading extremely strongly towards the end of June, in fact the best we'd seen at that time of year in a long time.
"But, the current situation in Sydney has scared people again and they're staying away a bit more.
"I'm sure as it passes, people will return to the movies.
"After all, streaming isn't 'going out', and humans are social beings who like to escape their homes."
Mr Howard said streaming had not been the only challenge to impact cinema operators.
"Cinema has always survived through technical innovations like TV, then colour TV, then home video and DVD, and it will again because it offers something you just can't replicate at home.
"People gravitate away, and then gravitate back when the novelty wears off."
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