With increasing demands on everyone’s time and attention, you’d be forgiven for choosing a night in, as your 5-to-9 after your daily 9-to-5. Considering the entertainment options available to you, that sort of consumption choice might even be a given for some people. Staying home to watch a movie once meant choosing between low-budget made-for-TV fare or outdated popular films, which had already completed a long run in the theaters.

During the pandemic though, streaming services actively sought to cater to (literally) captive audiences’ expectations. Thus, they began releasing many more, and higher quality, movie titles primarily or even solely on their streaming platforms. At the same time, traditional studios shortened the time between theatrical releases and in-home viewing options. Even massive blockbusters often appear in theaters for only about month, before being released to stream on an affiliate service.

Although these trends have remained consistent in recent years, some smaller, niche films might be challenging the new normal, by demonstrating surprising levels of success with a theatrical release. For example, Paramount+ released its low-budget horror film Smile in theaters, in response to really promising feedback during test screenings. The movie went on to gross more than $200 million in sales—an unexpected and welcome return on its $17 million budget. Likewise, Sony’s romantic comedy Anyone But You and MGM’s The Boys on the Boat found box-office success. 

In contrast, the big budget blockbusters that once seemed to be the main reasons people went to the movies have been falling short of their predicted returns. Apple suffered a string of losses, earning only $157 million on Killers of the Flower Moon, which cost $200 million to make. Likewise, the spy flick Argylle cost Universal $200 million, but it only grossed $96 million in theaters.

These changing patterns have prompted studios to take more individualized approaches. Rather than relying on conventional wisdom, they have begun to evaluate each project on its own merit, including projecting each film’s potential performance at the box office before greenlighting its theatrical release. Paramount largely has pioneered this strategy, and industry observers predict that other media companies, like Disney and Warner Brothers, will soon follow suit. Recently, Apple chose to open its Brad Pitt–George Clooney vehicle Wolfs in a limited number of theaters for just one week, before making the movie available on Apple+.

Not only box office numbers but also investor sentiment seems to support this approach. As ad revenues shrink from traditional television channels, and the number of new users joining streaming services diminishes, adding back in some immediate earnings from movie theaters seems promising. Yet simply reverting to a theatrical model cannot be the total solution, and it will not be enough to revive studio profits. Each distributor needs to find its own release schedule, such as choosing to assign smaller films to theaters during slower periods. If the studios can do that, it’s possible that lower budget films may consistently enjoy the box office success once reserved for blockbusters.

Discussion Questions

1. How can studios maintain consistent profits, even as they release multiple films across different platforms?

Sources: Frank Pallotta, “How Long Should Movies be in Theaters Before Streaming? Hollywood is Trying to Find Out,” CNN Business, February 28, 2021; Nicole Sperling, “Apple Rethinks Its Movie Strategy After a String of Misses,” The New York Times, August 25, 2024; Sarah Whitten, “To Stream or Not to Stream: Hollywood Studios Could Send More Films to the Big Screen as Wall Street Pushes for Profits,” CNBC, January 31, 2024