Netflix’s audience of cord-cutters and cord-shavers who can’t be bothered with traditional cable TV are disrupting another classic Hollywood viewing experience: the movie theater.
More and more luxury theater chains have popped up in the US recently as those no longer content to pay $10 or more for a viewing experience they can get on their couches demand more from the theatergoing experience. These new premium theaters from companies like Landmark Theatres and iPic Entertainment offer perks like leather recliners, artisanal cocktails, or meals delivered directly to one’s seat.
They’re slightly more expensive than traditional theaters. Ticket prices at iPic’s new theater in New York, for example, start at $14 for seats closer to the screen that don’t come with table service, and run up to $32, depending on membership and the day of the week, for better seats that recline and include table service, a blanket and pillow, and unlimited free popcorn. But the added amenities are worth the price for some. All iPic theatergoers, for example, can pick their seats in advance, and the company says their customers don’t pay fees for online ticket purchases or 3D glasses like they would at some other theaters.
Netflix just inked a deal to bring its original movies to these venues. The streaming video giant is partnering with luxury theater chain iPic to release its films in theaters on the same day they’re made available online, the Wall Street Journal reported. The theater distribution deal reportedly includes 10 films that will make up the bulk of Netflix’s original movies for the next year. They’ll be shown at iPic’s New York and Los Angeles theaters, and Netflix will have the option to screen the same films at other iPic locations or independent theaters.
One reason the partnership makes sense is that iPic customers tend to be Netflix subscribers. About 98% of iPic customers subscribe to one or more streaming services, and 84% of them were Netflix members, according to a recent company survey of 600,000 of iPic’s 1.6 million members. “These are people that love watching movies,” said iPic CEO Hamid Hashemi. “They watch them no matter what medium you stream them in.”
Since Netflix is releasing its films simultaneously online and in theaters, it needs to incentivize subscribers to pony up extra cash for the theater experience. iPic’s various amenities appear to do just that. Netflix tested its theatrical potential by releasing its children’s movie The Little Prince on streaming and in select theaters, including iPic in Los Angeles, on August 5. Netflix chief content officer Ted Sarandos told the Wall Street Journal that it sold “nearly every seat” during the iPic run.
On the other hand, Netflix likely isn’t expecting a windfall of theatergoers to attend the screenings. Its limited theatrical run of the original movie Beasts of No Nation flopped, after all.
The move seems to be designed to boost Netflix’s odds of winning an Academy Award, which the streaming service is eager to add to its trophy case. To be eligible for an Academy Award nomination, feature-length films must be released in theaters in Los Angeles County for at least a week. The movies also cannot run in non-theatrical formats before being released in Los Angeles, which appears to be why Netflix will release them simultaneously online and in theaters.
But there’s a reason Netflix chose to partner with a small theater-chain like iPic rather than a major movie house. Most major theater chains despise Netflix. The streaming video service has refused to play by the Hollywood rules for “windowing” with its theatrical releases, in which studios hold off on releasing their films in other formats for months after they’re released in theaters. Other streaming giants like Amazon that have had theatrical runs have abided by this convention—waiting a set amount of time between theatrical and digital release—but not Netflix.
The worry is that people won’t go to the theaters if they can watch the same content at home. Haschemi at iPic isn’t so concerned.
“Going to the movies is a night out that should be an experience and that’s what we deliver,” he said. “The more varied content we have the better off our guests are.”
Netflix did not immediately respond to requests for comment.