THB #279: It Was A Very Good Year
Oh my lord, if you read some of the industry writers out there, the sky is falling at the same time that hell is freezing over and it’s like they are imagining a world in which Will Smith would be arrogant and self-destructive enough to release an awards wannabe less than a year after he assaulted Chris Rock on stage without even so much as apologizing in a way that suggests he takes any responsibility.
HA! Like that could happen!
I was originally planning on this being a Top 10 list… but my schedule loaded up and I mixed in some of the things happening together. If I am feeling it, I will do more of these in the weeks to come. But for now, these three…
Netflix Gets Whacked
On November 11, 2021, Netflix was trading at an insane $691 a share. Two months later, $525. Two months later, $340. Then, the big drop, falling below $200 a share for the first time since December 2017… $188 on April 26.
Of course, the stock has recovered since. $290 a share as of this writing. Many are still living under the delusion that the company is invincible. As the increasingly muopic Barry Diller said, “Netflix won… get over it.” This coming from the man who succesfully launched a 4th television network in America, owned by an Australian tabloid magnate. Oy.
Netflix is still, unquestionably, the leader in streaming. But a 5 year+ headstart has a lot to do with that status. That and doing many things well. But the fall of Netflix - to just being overpriced by the market and a media company with a massive worldwide footprint - is a real thing. People really don’t want to wake up and smell the problems. Least of all the leaders of Netflix. But they are hardly the first to have the arrogance to believe they will be on top forever.
We can all see the guy(s) behind the curtain these days. He’s human, like everyone else. He has big successes…but also, plenty of failure. When Bob Chapek is too stubborn for the company’s best interests, he gets killed. When Netflix leadership gets too arrogant to seriously consider remodeling the house, their stock price jumps 20%. Go figure.
I have long held that the massive/insane stock price, closing in on $700 a share, was a millstone around the company’s neck. How can you make major adjustments when everyone is still betting on you to overperform any remote possibility of success? In some ways, it’s the dog that caught the tire.
Netflix is a breathtaking company. Make no mistake on my view. But to all things, there are seasons.
Besides their own issues and the need to make some real changes, they have been a terrible influence on all the other major aspirants in streaming. In so many ways, no other company could realistically emulate how Netflix rose to success and led the way to the next iteration of television. I don’t think they meant to damage others by giving them something impossible to repeat… but they did.
The stock market hasn’t caught up yet, but the fall of Netflix has reset the playing field and left some oxygen for different ways of approaching the future of streaming. All the same problems, especially for Legacy television, are there. They are there for everyone, including Netflix.
But in my opinion, Disney’s future under Hamlet’s returning father, Bob Iger, is not going to be about chasing Netflix’s accomplishments. Amazon seems ready to make its position clearer than it has ever been in this arena. Warner Bros Discovery needs some PR help, but they told us last summer that they really wouldn’t be unveiling their future until Summer 2023. Media refuses to wait. Comcast and Paramount and Starz each are trying to figure out how this works best for them.
Since the bottom fell out, which took 2 quarters for the Netflix Kings to seriously acknowledge, Netflix has shown again that it is no longer drawn to the bleeding edge. Even as they have jumped into an advertising tier, they didn’t leap so much as toe dip with a tier that is marginal at best. They sold the idea that they were breaking new ground in theatrical with Glass Onion… but it didn’t even get to theaters before Ted Sarandos was pooh-poohing the whole thing. The hope that gaming would bring a new edge to the company have become muted.
Netflix will be fine for the next few years, regardless of how they drag their feet. But will they be the leader anymore? Are they leading now?
The fall of Netflix has opened up the possibilities of streaming for everyone… including Netflix.
Domestic Theatrical is viable again
I’ve come at this issue from a lot of different directions in the last year. As the year ends on an Avatar, I will try another.
Last year, in 2021, there were 14 movies released that grossed over $100 million domestic. Those 14 movies represented 63% of the overall domestic box office.
This year, in 2022, there are 17 movies (adding in Avatar 2) that will gross over $100 million domestic. I can’t measure Avatar in this (since it hasn’t opened), but the 16 films that have already been released have represented 62% of the overall domestic box office to date.
So what do you think things were like in 2019?
31 films did over $100 million domestic. They generated 67% of the overall domestic box office.
In other words, 2/3 of the market is blockbusters… before COVID and “after” COVID.
Also… n 2019, wide releases (over 1000 screens) represented 89% of all domestic box office revenues. This year, 2022, that percentage is 91%. Again… close to identical.
The average domestic gross of a wide release movie in 2019 was $77.5 million.
The average domestic gross of a wide release movie in 2022 has been $63.9 million.
That’s roughly an 18% difference… which seems about where we are in the recovery.
So why are grosses down by much more than 18%? Because as of December 15, we have had 97 wide releases in 2022, compared to 131 in 2019.
That’s a 26% pullback in the number of wide release films.
Put another 35 titles in wide release next year and you will likely see domestic box office break $9 billion, if not $10 billion.
35 x $63.9 million = $2.2 billion.
$2.2 billion + $6.8 billion = $9 billion. And that 2022 gross figure is before Avatar: The Way of Water.
There are 79 wide releases currently on the domestic theatrical schedule. That will expand. But some of those titles will also dissolve. If the 2023 total breaks the 100 film mark, it will be a surprise.
So yeah, lots more IP films coming in 2023. But the implications of there not being more films of all kinds is not positive.
It’s been a kinda great year for women in the film industry. Yes, it may be that Sarah Polley is the only serious candidate for Best Director at the Oscars. But do get over the small stuff. Black Panther: Wakanda Forever is a movie more powered by women than men, at least on screen. Nope… female lead. Smile, The Lost City, Where The Crawdads Sing, Scream, Everything Everywhere All at Once, The Woman King, Halloween Ends, Don’t Worry Darling, Downton Abbey: A New Era… even Barbarian.
That’s a full third of the top 36 domestic releases this year that were led by women.
It’s not everything… but it ain’t nothing.
Of course, this doesn’t include Turning Red or The Wonder, or Empire of Light or even Women Talking, which hasn’t opened theatrically yet. Not to mention X/Pearl, Aftersun, Nanny, Master or The Eternal Daughter.
And back to that awards thing… the realistic list for male lead is about 6 or 7 deep. Lead Actress is easily 11 deep.
And one thing about these “women’s” movies… they are, overall, smarter than the guy’s movies. May of them are seriously about something and not just trying to entertain.
The answer is not always obvious. Everything Everywhere All At Once is Michelle Yeoh’s movie… but is written and directed by men. The Woman King is loaded with women running departments… which doesn’t make it a better movie than others… but does matter in a real way.
What are the hot shows on streaming right now? Wednesday and The White Lotus… led by women.
Yes, we need to do even better in this regard. But I would say this was a rather good year.
How was the year for you? Santa will be extra nice if you subscribe today! But if you believed in Santa, why would you be reading me?