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Part of a ZDNet Special Feature: Coronavirus: Business and technology in a pandemic

Warner Bros to movie theaters: Drop dead

Opinion: Will straight-to-streaming become the 'new normal' for film releases?

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Warner Bros. will offer new 2021 film releases on HBO Max at the same time as their release in movie theaters, a move that launches the first cannonball in the battle between future film screenings and streaming services.

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Warner's entire roster of films due to be released next year -- 17 in total -- will be made available on HBO Max at the same time they hit theater screens, as reported by the New York Times,.

These upcoming movies include Dune, Godzilla vs. Kong, and The Matrix 4. 

Warner says it is exploring the opportunities of the new "hybrid model," made at no additional cost, to HBO Max subscribers across the United States. However, the announcement concerning simultaneous release has the potential to shake the foundations of what is left of the beleaguered cinema industry, with many chains already facing bankruptcy

Few industries have been hit as hard as hospitality and entertainment during the COVID-19 pandemic. Theaters have been forced to close, pubs have been made to shut or offer takeaway services only, and countless people in events and creative roles have lost their jobs. 

Typically, there is roughly a 90-day period between cinemas showing new releases and content being made available elsewhere. By announcing plans to revoke this 90-day period, however, Warner caused movie theater stocks to slide on Thursday, making an already precarious situation caused by COVID-19 restrictions and the impact of the pandemic on film production and customer screenings potentially even worse. 

It was not only investors that became jittery after the news. The shock announcement prompted AMC Entertainment chief executive Adam Aron to say the chain has "commenced an immediate and urgent dialogue with the leadership of Warner on this subject," as noted by Gizmodo.

"Clearly, Warner Media intends to sacrifice a considerable portion of the profitability of its movie studio division, and that of its production partners and filmmakers, to subsidize its HBO Max startup," the CEO said. "As for AMC, we will do all in our power to ensure that Warner does not do so at our expense."   

If this is to be believed, profits generated from the Warner movie studio division could become the sacrificial lamb for propping-up and subsidizing HBO Max -- no matter, perhaps, what the consequences will be for the cinema industry at large. 

The $14.99 per month HBO Max platform has not attracted the flurry of subscribers the company would have liked to see, trailing behind rival services such as Disney+ and Netflix. 

Speaking to NYT, WarnerMedia CEO Jason Kilar said that even should the theater industry started recovering and Covid restrictions reduce, the new model -- in which new films will be shown for one month on HBO Max -- will stay in place over 2021. 

On Twitter, views were mixed. Many applauded the news, declaring their desire to watch new movies at home without rising exposure to COVID-19, whereas others criticized Warner for what could be a serious blow to traditional movie theaters. 

One Twitter user, perhaps, put one school of thought best:

"Screw 'em. I'd rather watch new releases in the comfort of my home. I resent having to wait weeks or months if I don't want to take a trip and pay extra to sit in a theater to watch 'em." 

This comment touches upon what we have grown used to during lockdowns and stay-at-home orders: immediate media consumption and gratification. 

First, we no longer had to wait week-on-week for the next episode of our favorite television show, with full seasons dumped on content distribution platforms in one go. Next, we could rent hard copies of movies anytime we wanted. Then, streaming services appeared, as well as on-demand catch-up services. 

In fairness to streaming services, many did well over lockdown to provide the widest range of entertainment possible -- and some also throttled high-resolution options to cope with the rise in demand -- as we were made to stay at home, bake, work, game, or crash out in front of a television to stay entertained. 

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The decision to give theaters no exclusive time before films end up on streaming platforms over 2021, however, may prompt other companies to follow suit - and in other countries -- perhaps satisfying our expectations for media to be available more quickly than before, but hammering another nail in the coffin for movie theaters. 

This is a reminder of when UK chancellor Rishi Sunak said the government would try to protect "viable" jobs -- leaving many in the creative industries, events, and hospitality to sink, swim, or retrain. 

When you throw a heavyweight like Warner into the ring, it is possible that a private company that could end up deciding how the future of cinema will play out (and, of course, luring more subscribers to a streaming service is a bonus) -- and also inadvertently choose whether or not the big screen is 'viable' at all, post-Covid. 

If consumers adopt "straight-to-stream" with enthusiasm, it may be nigh on impossible to return to the old 90-day model, transforming streaming services from an evening-in bolt-on to the preferred way to watch new movies. 

If that happens, the traditional cinema may become a thing of the past and lost to what will become the "new normal" after the threat of coronavirus has diminished in our minds. 

Ann Sarnoff, CEO of WarnerMedia Studios and Networks Group, said in a press release that "no one wants films back on the big screen more than we do [and] we know new content is the lifeblood of theatrical exhibition, but we have to balance this with the reality that most theaters in the US will likely operate at reduced capacity throughout 2021."

"We see it as a win-win for film lovers and exhibitors," Sarnoff added. However, the long-term consequences of this decision and its impact on theatergoers and filmmakers remain to be seen. 

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