Netflix’s acquisition of Warner Bros.: impact on theaters

Netflix’s acquisition of Warner Bros. immediately prompts one question throughout Hollywood and on Main Street: what happens to the movies in theaters. Early indications from regulatory filings and comments made by each company suggest a clear throughline — Warner Bros. films will continue playing in theaters — but with a Netflixian twist to how long and how soon they’re streaming.

What changes immediately for Warner Bros. theatrical plans

Netflix makes clear in disclosures to antitrust regulators and in separate joint statements that it will keep Warner Bros.’ core businesses, not least theatrical distribution. That point of view is in line with reporting by Bloomberg that continued play on the big screen was a cornerstone, not an afterthought, of Netflix’s approach.

Variety has noted Warner Bros. already has multiyear bookings with exhibitors; in other words, the release plans for the near term won’t be rewritten overnight. Look for the studio’s pipeline — DC, Monsterverse, Dune and awards contenders — to remain on the calendar while any change in policy is phased in.

There will still be bureaucratic obstacles. The transaction is subject to United States securities and antitrust reviews, as well as potential examinations in strategic markets internationally where Warner titles are sold. None of that necessarily changes how long movies remain in theaters, but it could influence the timeline for closer integration.

Why the theatrical window is the key battleground now

Netflix co-CEO Ted Sarandos has been saying for some time now that extended exclusive theatrical windows aren’t consumer-friendly. On an investor call following the announcement of the deal, he reiterated a commitment to starting a film’s life in theaters while suggesting that interest was being shown in seeing whether the streaming on-ramp could be sped up. Translation: the issue is not whether Warner Bros. movies would play in theaters, but for how long.

The industry has already been moving away from that longer window. Post-pandemic, many studios landed at 45 days for wide releases (though some worked on 31-day and even 17-day windows based on opening-weekend performance and genre). Some in Hollywood believe that Netflix will be able to press for even shorter periods, with whispers of a two-week window thrown around by people familiar with the discussions; others argue that the windows would necessarily have to be longer. The final number probably will be different title by title.

Shorter windows can help shorten the marketing spend, and speed the streaming bounce, which is good for a subscriber business. The trade-off: fewer “legs” at theaters, potentially lower box office multiples and tougher economics for exhibitors and talent with box office participation.

A likely theatrical and streaming playbook by genre

Expect segmentation. Tentpoles — whether DC epics, Monsterverse entries or the next “Dune” installment — will help keep traditional wide releases fluent in premium formats and hammy ad campaigns. Symptoms may abate, but these movies require theaters of scale to unlock global IMAX and PLF grosses as well as fan buzz.

Netflix could also experiment with performance-based windows for midbudget comedies and thrillers: go wide, then rush to streaming if something flops; or give a surprise hit like “Bohemian Rhapsody” a longer theatrical life. Prestige dramas as well as director-driven works will still probably keep playing in theaters to qualify for awards, given both Warner’s history and Netflix’s own awards aspirations.

Meanwhile, smaller titles and niche documentaries are positioned for adaptability: targeted platform releases in key cities, event-style engagements or bypassing theaters with a direct-to-streaming approach when there isn’t much theatrical upside. This echoes Netflix’s traditional practice — limited, curated runs meant to impress critics, please fans and meet eligibility requirements — now supercharged by Warner Bros.’ distribution muscle when a broad push is warranted.

How exhibitors and talent could be affected by new windows

The headline win, however, for theaters, is continuity of the Warner slate. But the finer print matters. AMC, Regal and Cinemark have long resisted ultra-short windows for Netflix originals. In recent months Netflix has experimented with short-lived, limited releases and extended runs in major chains. Should Warner titles embrace squeezed windows, exhibitors could call for improved revenue terms or premium-format exclusives to compensate for the shorter runs.

The economics of talent, too. It will be exponentially more difficult if people start to say, “We’ve already funded our future.” Back-end participation linked to box office is harder to quantify in the era of sudden streaming pivots. Look for more upfront buyouts, performance-based bonuses and data-sharing thresholds to compensate. The memory of the outcry over day-and-date strategies still lingers with the industry, and Netflix will want to avoid charges being leveled against it a second time by providing both transparency in how productions are scheduled and released as well as incentives for star talent and producers (or at least those with proven track records).

Consumer behavior is the wildcard. Comscore and its data partner, the MPA, have consistently demonstrated that heavy streamers are also frequent moviegoers. A middle ground — strong theatrical for event films, quick streaming thereafter — may be able to expand audiences rather than eat into them, provided the messaging is clear and the windowing predictable.

Global considerations for release windows and streaming

And abroad, Warner’s decades-old ties with local distributors and the significance of markets with quotas or censorship reviews argue for robust theatrical footprints. But franchises that are dependent on overseas grosses require a steady stream of big-screen presence, and local-language marketing campaigns are not so easily recast at the 11th hour if a window moves by as much as it has during this crisis.

And anticipate that Netflix will still keep up its regional strategies while consolidating post-theatrical timing into the beast of the global service. Quickening the pace of streaming can also aid in synchronizing global conversation and lower piracy risks when a film has already opened in one section of the world.

What to watch next as Netflix integrates Warner Bros.

And key indicators will come shortly: updated pacts with major exhibitors, formal guidance for minimum theatrical windows for tentpoles and the first wave of release schedules under Netflix stewardship.

Also look for cues from guilds and top-tier talent — if marquee directors or stars publicly support the plan, negotiations around compensation and transparency probably are headed in the right direction.

The bottom line: Warner Bros. movies aren’t leaving theaters. But in the Netflix era, a film’s theatrical chapter of its life is arguably going to become one that is tighter, more strategic and more variable — with the intent, however unlikely it seems today for almost anyone but Marvel Studios, of maximizing both box office and the streaming surge that comes next.