Netflix Exec Offers Big Prediction About Movie Theaters, and It's Not Pretty

Netflix's chief operating officer Greg Peters made some candid comments about the future for movie [...]

By Michael Hein

Netflix's chief operating officer Greg Peters made some candid comments about the future for movie theaters in a new interview on Thursday. Speaking at the virtual Morgan Stanley Technology, Media and Telecommunications Conference, Peters said that he believes the dwindling importance of theatrical releases is inevitable because "It's what the consumers want. It's hard to buck that trend for too long and I think that's eventually where things go."

Peters said that the coronavirus pandemic only sped up a process that was already in place, confirming that Netflix was looking at ways of getting around theatrical releases long before the virus hit. According to a report by Deadline, Peters was the company's product chief until last year when he took the additional COO title as well. He pointed to critical successes like The Irishman and Roma as the paper trail of Netflix establishing a respectable film portfolio. At the same time, he said that Netflix has been in talks with theater chains and distributors about how to move forward in the new world of streaming.

"We have created the most compelling collection of entertainment available at the click of a button that's ever existed," Peters said. "That's incredible for consumers and for our members. For us, as user experience designers and builders, it creates a challenge because, across that wide range of choice, our job is to distill that down into something that makes it easy and fun and exciting to pick what you want to watch next. We wake up every day thinking about how to make this better. So, we're far from content with where we are and there are hundreds of tests that are being run to try to make it better."

These frank comments from a Netflix executive follow on similar input from other streamers in both word and action. Warner Bros. shocked the entertainment industry late last year by announcing that all of its new movies in 2021 would premiere simultaneously in theaters and on HBO Max. A similar deal will reportedly be in place for Paramount+.

Meanwhile, Disney CEO Bob Chapek seemed to take the same side as Peters last week during his own Q&A at the conference. He said: "The consumer is probably more impatient than they've ever been before, particularly since now they've had the luxury of an entire year of getting titles at home pretty much when they want them. So, I'm not sure there's going back. But we certainly don't want to do anything like cut the legs off a theatrical exhibition run."

"This is a fluid situation and it's fluid for two reasons," Chapek said. "The short term impact of COVID on the number of screens open and on consumers' willingness to go back, but also the fundamental changes of consumer behavior, which might be more profound. We are watching very carefully... to see how long term those preferences are going to shift. and that's why we talk about flexibility so often."

Disney's adaptations have been less consistent than other companies', with some new movies like Soul and Cruella going up on Disney+ for no additional cost, but others like Mulan and Raya and the Last Dragon premiering for a PVOD price of $29.99. So far, Netflix has not taken the step of charging an additional price for a new movie, though the streamer has branched out successfully into just about every genre of films, from blockbusters like The Old Guard and Extraction to thoughtful, Oscar-worthy movies like Da 5 Bloods.

"We have originals that were in the 'challenge for awareness' state that are now in a completely recognized state," Peters said in his interview. As for what comes next, he said "it's a fertile space" for experimentation, but it "mostly involves listening to members."

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