3 Reasons Warner Shattered Theatrical Release Windows (& Theater Relationships)

WarnerMedia rocked Hollywood this past week with its decision to release its entire slate of feature films direct-to-home (DTC) via HBO Max on the same day 1 as in movie theaters. Although shocking to many, Warner’s decision should come as no real surprise, given all of the unprecedented forces that the studio faces right now (and recent announcements, including its upcoming DTC release of Wonder Woman). Here are Warner's 3 primary reasons for taking this step now.

First, we are just about to enter 2021, and U.S. pandemic realities look grim. The more time goes by with the pandemic as being story #1 in our lives, the worse it gets for movie theaters. Right now, it’s hard to imagine any major theater comeback in 2021 in the U.S. Faced with this daunting reality, Warner – like other studios – essentially has no choice but to try to maximize its massive film investments where the dollars are. And that’s at home – in the pockets of consumers who see no escape from their couches anytime soon.

Second, HBO Max has garnered little buzz thus far amidst the streaming war noise generated by its massive competitors, namely Netflix, Disney+ and Amazon Prime Video, which have dominated the headlines (and consumer subscription dollars). Those goliaths already benefitted from massive head-starts over HBO Max, and Warner must find a way to break out into consumers’ minds as a formidable force. Consumer confusion over its HBO Max branding strategy didn’t help. As with other major streamers, and with this announcement, Warner will now use its highest budget franchise films to serve as the foundation of its 2021 HBO Max marketing strategy. And now that the genie is out of the bottle – with DTC release on day 1 – it ain’t going back. So while Warner says this is a temporary strategy for 2021, don’t be too sure about that. They, like the other studios, will study their overall return on investment and lock down final strategies based on results from these new major experiments. Theatrical windows have already been shattered. Theatrical relationships too. That damage is done.

And, third, just as Disney reignited confidence and support from its shareholders and the investment community when it recently prioritized streaming first (and restructured the entire company to emphasize that point), Warner is doing the same thing with this move. Warner’s parent company, AT&T, is stealing a page from the Disney investor relations playbook and demonstrating that it is going “all in” to win – or at least be a major success – amidst other giants in these streaming wars.