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The first line-up announcements for the 2018 Cannes Film Festival dropped, with new films from Spike Lee and Jean-Luc Godard joining the high-profile premiere of Ron Howard's Solo: A Star Wars Story. But the international celebration of cinema still finds itself dealing with the repercussions of drawn battle lines between powerful distribution player Netflix and the iconic fest.

Variety initially broke the news, saying that Netflix was refusing to send any of its original films to France in May because of a disagreement with the Cannes fest over rules for Netflix films that want to play in competition. Cannes says only films that play theatrically should be able to compete. Netflix says it will allow its film to play theatrically, but they balk at a law in the country that prevents films from playing on a home platform for 36 months after a theatrical debut. Netflix, in the past, has done day-and-date releases for movies that it also sent to movie theaters, from Mudbound to Okja.

In the Variety interview, Netflix's chief content officer Ted Sarandos bemoaned the Cannes rules change -- which he believes is aimed directly at Netflix -- and explained:

Film festivals are to help films get discovered so they can get distribution. Under those rules, we could not release our films day-and-date to the world like we've released nearly 100 films over the last couples of years. And if we did that, we'd have to hold back that film from French subscribers for three years under French law. Therefore, our films they are not qualified for the Cannes Film Festival competition.

This morning, at the press conference to announce the initial slate of Cannes titles, Artistic Director Thierry Fremaux walked back the challenge to Netflix slightly, saying that Netflix remains "welcome in Cannes," and that the two sides were having "constructive dialogue." According to Deadline, Fremaux clarified that the theatrical-window rule is actually old, but only needed to be brought back up because of the way it applies to Netflix's current distribution model. He went on to say:

Netflix is welcome in Cannes. We have an ongoing debate. We want to tell Ted [Sarandos] and Reed [Hastings] and Scott [Stuber] to come, let's keep talking.

The industry likely will pay very close attention to how this is resolved. Netflix is continuing to grow as a distribution option for filmmakers who can not get their movies into theaters. Netflix also is taking a chance on original films such as Duncan Jones' Mute (from earlier this year) and Jody Hill's The Legacy of a Whitetail Deer Hunter, which recently played at SXSW.

At the same time, Netflix recently had to weather a small storm as Steven Spielberg took a hard stance on movies that premiere on the platform, calling them "television movies" and claiming that they should not be able to contend for an Oscar.

We'll continue to see how this shakes out. For now, Netflix appears to be sitting out Cannes, and with people on social already complaining that the announced Cannes movies look weak, I'm wondering which party is getting more hurt by these developments.

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