Amazon is beginning to invest more in theatrical releases as major box office returns are becoming a safer bet than streaming distribution.
Key Details
- Amazon is taking its film distribution in a new direction in addition to its exclusive distribution through Amazon Prime Video.
- The company is going to begin rolling out theatrically released films—investing as much as $1 billion per year to produce 12 to 15 new original films per year. It plans to begin rolling out theatrical releases in 2023, according to Bloomberg.
- Many of its previous films have received a limited theatrical release but the commitment would position Amazon alongside other major Hollywood studios as a major production company.
Why it’s Important
Amazon’s move marks an attempt to edge into another new market following a year of chaotic financial investments and attempts to edge into new industries. Its billion-dollar investment into producing a Lord of the Rings television series for Amazon Prime was met with relative critical malaise and the innovation arm of the company is reportedly bleeding money. It has made major investments in sports and health care with mixed results.
“Even though Amazon is in a cost-cutting mode, the company is ramping up its investment in original movies following the $8.5 billion acquisition of MGM, a 98-year-old Hollywood studio that released Ben-Hur and Legally Blonde,” says Bloomberg.
Even while the company as a whole is laying off thousands of workers and cutting divisions, it sees opportunity in its film division after the modest critical and financial success of smaller films like Manchester by the Sea and The Big Sick.
Backing up a Bit
The relationship between theatrical releases and streaming has been tense since Netflix tried to edge itself into the market as a legitimate studio. In order to qualify for the Oscars, films must have a two-week theatrical release in Los Angeles. The company has released numerous Oscar-contending films including The Irishman and Power of the Dog but faced initial backlash for releasing films in an untraditional theatrical window.
“Streaming services have eschewed theaters with most of their original movies or released the titles for less time and on fewer screens than traditional movie studios. Netflix in particular has aggravated cinema chains by releasing more than a movie a week for viewers at home,” says Bloomberg.
It has become more common over time for streaming services to release awards contender films in limited releases, including Netflix’s newest films like Glass Onion and Pinocchio.
Notable Quote
“Theaters will welcome the new product from Amazon, whenever it comes. U.S. ticket sales are down more than 33% from 2019, the last full year before the pandemic closed theaters. Many of the biggest movie studios are part of companies that have started releasing original movies online to boost their streaming services,” says Bloomberg.