How the cinema experience can survive in the age of streaming

Duncan Jones's Netflix exclusive Mute

Video streaming is smoking hot, with Apple’s new service destined to arrive in living rooms any minute, and the new YouTube Premium taking on the might of Netflix. Cinephiles now have more films at their fingertips than ever, but does it mean the end of the traditional movie theater experience, with its flip-down seats, hushed excitement and vats of sticky popcorn?

“There was a time when a company wanted to pioneer having theatrical and streaming releases [come out] at the same time, and there was a huge debate between the traditional cinemas and the sites as to whether this was the right thing to do,” says Liz Han, deputy general manager for motion pictures and entertainment at Beijing Culture.

“It should be a win-win, but there’s a huge conflict because it shortens the mature window time between theatrical release and the streaming sites.”

Nate Fan of Shanghai Bliss Media says streaming sites need to be more confident about investing in original content – even if some, like Netflix's Mute, miss the mark

Nate Fan of Shanghai Bliss Media says streaming sites need to be more confident about investing in original content – even if some, like Netflix's Mute, miss the mark

Han is one of four industry experts speaking about the future of the film at CES Asia. The event is China’s largest tech show, and attracts professionals from around the world.  Although many of the panelists work in the traditional side of the entertainment industry, there’s a cautious optimism about the possibility of streaming sites and theaters working in harmony – for both filmmakers and audiences.

Supporting indies

“For me, it’s a huge bonus,” says Sophia Yen, a partner specializing in entertainment at law firm Manatt, Phelps and Phillips. “In the US we have so much content, but only the most premium content gets distribution through theaters.

“There are about 900 films made domestically in China [each year], but there definitely aren’t 900 films on theatrical release, so [streaming] could be a way for them to get distributed.”

Nate Fan, president of distribution at Shanghai Bliss Media, agrees that streaming makes it possible for small and independent filmmakers to find an audience for their work, which is a boon for projects that would otherwise struggle to find an audience and fund their work.

“It’s a matter of how you address your audience,” he says. “We’re talking almost $10 million for a cinema release, but if you choose to use streaming to address your audience then it’s much cheaper. As an independent filmmaker, we really can’t spend that kind of money. Here, we would spend $11 million and raise $70 million – that’s a success. We’ve been seeing how streaming can address the audience, and in the US they’ve been really brave.”

Okja

Okja, jointly funded by Netflix and Brad Pitt's production company Plan B, was released online to critical acclaim

Netflix spends 85% of its budget on original content, but Fan believes many streaming sites are too risk-averse – and that’s holding back the whole film industry. A theatrical release needs a huge marketing budget, but filmmakers who release their work to streaming sites can afford to spend more on production – provided the sites give them a chance.

“It’s not a competition, but streaming sites probably needs to be able to take more risk in producing content,” he says. “They should spend more money on production. There will be a gap in the next few years, and whoever will pay more for budget will win. Streaming people shouldn’t compete on spending money on marketing – they should spend money on content.”

The popcorn ritual

Despite their belief in streaming’s potential, all the panelists believe the traditional movie theater still has its place – though it’s becoming a more specialist niche that has to work hard to justify the price of a ticket.

“It’s like a ritual,” says Liz Han. “A social occasion for couples on dates, for friends to hang out, so that’s one thing that online streaming can’t replace. The whole experience that you get in cinemas isn’t something that you can get in your living room. Even though some online sites want to build something that’s similar to cinema, it’s still a whole experience that you can’t copy.”

“It’s all about service,” adds Nate Fan. “It’s more than the film. When I released Hacksaw Ridge, I got some bad comments online, and they were all about the cinemas – this cinema is cold, the picture isn’t clear. Those cinemas will die out soon. They provide more than just the ability to see a film, which is why I think they won’t be replaced.”

There are some parallels with virtual reality – another hot topic at CES Asia. Although you can now get an impressive VR experience in your living room, the act of actually traveling to a venue and meeting friends makes it much more of an event – and that’s something no home entertainment system can replicate.

Ultimately, the panel believe that the future of movies lies in cinemas and streaming sites working in harmony rather than competing. After all, if film flounders, there’s no shortage of other ways for viewers to get their entertainment fix.

Derren Brown's Ghost Train

Virtual reality and film offer a totally different experience when audiences make a trip to a venue like a cinema or theme park

“You could say that low budget films, or ones that won’t work well in cinemas, can go to streaming sites two weeks after theatrical release,” says Han. “There should be a way to work together so everyone can make money. Audiences can’t be harmed either way because they will have more content – either in the cinema, or on sites.”

For Sophia Yen, streaming doesn’t need to try to replicate the movie theater experience at all. Instead of settling down at home with a giant TV and Dolby sound, the likes of YouTube and Netflix have a unique advantage in their ability to provide entertainment on the smallest of screens.

“In the US, it’s very hard for a smaller indie film to do well in the theater unless it becomes one of those prestige films that generate Oscar buzz,” she says. “For everything else, if you do a wide release in the US, you need a large marketing budget to go with it. $30-40 million for a marketing budget is the minimum you need to have an impact. Having the ability to watch smaller indie films through your phone would help the creators.”

So is it curtains for cinema? The overall consensus is no, far from it – and if both movie theaters and streaming sites are willing to adapt, the future of film can be brighter than ever.