Decides to Play Nice With Hollywood

Bending to Hollywood's wishes, Amazon agrees to allow the traditional 90-day window for theatrical releases. Here's why it's a smart move.

Jeremy Bowman
Jeremy Bowman
Mar 11, 2016 at 8:00AM
Consumer Goods

In their quest to make streaming the predominant form of movie enjoyment, (NASDAQ:AMZN) and Netflix Inc (NASDAQ:NFLX) have run up against an unsurprising roadblock: Hollywood.




Now, Amazon is stepping back from that strategy and conforming to Hollywood's desires. According to Mashable, the e-commerce giant will release several upcoming flicks in the same way the regular studios do. It will collect half of the box office receipts and wait 90 days before shuttling it to the Prime Video streaming service. 

Not all of Amazon's new releases will abide by the 90-day window, but the higher-profile titles are expected to, such as Manchester by the Sea, a potentially award-winning drama the company bought for $10 billion at Sundance. As Amazon ramps up its movie production, catering to Hollywood's whims could be a winning strategy for a number of reasons.

Attracting talent
Not only do the Hollywood studios and movie theater chains prefer the current windowing system, but so do the auteurs behind the movies. Not surprisingly, filmmakers prefer to have their work screened at a theater rather than on your TV or smartphone. At the recent Sundance Film Festival, where Amazon and Netflix left with six films each, taking the biggest hauls of all buyers, many filmmakers expressed a sense of disappointment at seeing their movies go straight to streaming. The desire for a wide box-office release was strong enough to make Birth of A Nation producers turn down Netlix's offer of $20 million and sell to Fox Searchlight instead for $17.5 million.  


If you can't beat 'em, join 'em
Netflix has resisted the windowing process more directly than Amazon, but its results have been unimpressive. The leading streamer's first theatrical release, Beasts of No Nation, pulled in just $51,000 at the box office as movie theaters by and large shut it out because Netflix offered it simultaneously via streaming. Not only was Beasts a loser at the box office, it also disappointed during awards season, scoring no Oscar nominations. Nonetheless, the movie seemed to be received positively, rating 91% on review site Rotten Tomatoes. 



I think it's good for customers and good for filmmakers to have the movies get into theaters and have a robust theatrical run. Obviously, [the big screen] is the best way to see a movie ... I think preserving the theatrical experience and the theatrical window makes sense for everybody and we support that -- it's an important part of our approach.


As both companies dive further into original movies, Amazon may have the edge as it curries favor with the industry. The results of Beasts of No Nation and the Crouching Tiger sequel make it clear that Hollywood intends to fight back even as Netflix grabs a greater share of viewers.