U.S. President Donald Trump's proposed 100% tariff on foreign-made films has resurfaced. First floated in May, then quietly shelved, the threat returned this fall with Trump claiming other countries are "stealing candy from a baby" in the form of Hollywood. Entertainment stocks—including Netflix, Disney, Warner Bros. Discovery, and Paramount—dropped roughly 5% on the initial announcement. In September, markets barely reacted. Investors have learned these threats rarely materialize, but the proposal exposes dangerous blind spots about streaming's global supply chain.
The timing is particularly ironic. Just weeks ago, Netflix staged Creative Asia at the Busan International Film Festival, announcing expanded Asian initiatives. Meanwhile, Sony Pictures CEO Tony Vinciquerra told investors that "Crunchyroll is going to be our primary growth driver" —with the anime streamer projected to generate over 40% of Sony Pictures' operating profit over the next two years, more than theatrical releases. Crunchyroll has 17 million paid subscribers and is expanding aggressively into India, Brazil, Mexico, and Southeast Asia.
These aren't side bets. They're core strategy. Trump's tariff would penalize exactly the content driving subscriber growth while theatrical becomes a secondary revenue stream.
The policy targets the wrong metric entirely. Global theatrical box office represents roughly 1% of entertainment industry revenue, according to PwC. Streaming subscriptions, advertising, gaming, and licensing drive the other 99%. Yet Trump wants to tariff "foreign-made" films—a term that's meaningless when Netflix greenlights in LA, films in Toronto, uses VFX in London and Vancouver, and premieres globally. Which part is "foreign"?
Consider Sony's anime ecosystem: Aniplex produces in Japan, Crunchyroll streams globally, Sony Music monetizes soundtracks, PlayStation adapts IP into games. In March 2025, they established Hayate, a joint venture to create anime for Crunchyroll's platform. Sony paid $320 million to increase its stake in publisher Kadokawa to secure IP pipelines. Anime merchandise alone generates three to four times streaming revenue. Tariffs would attack multiple revenue streams simultaneously across an impossibly complex production chain.
The industry's real problem isn't foreign competition—it's that US production costs 30-50% more than Toronto, London, or Budapest. That's why 18,000 production jobs already left. Streaming platforms chase global tax incentives because subscriber acquisition costs demand it. Tariffs would only push more production overseas.
US platforms increasingly rely on international content for growth. Netflix's "KPop Demon Hunters" became its most-watched film two months after release. Korean dramas regularly top global charts. Disney+ depends on Japanese anime to compete in Asian markets. A tariff would either compress already thin margins or accelerate subscriber churn.
The economics are stark. The World’s Most In-Demand Streaming Title (Parrot Analytics) "Attack on Titan" had a $10 million budget for five seasons—what Netflix or HBO spends on one prestige drama episode. "Demon Slayer: Infinity Castle" became 2025's sixth top-grossing film globally on a $20 million budget. The anime market is projected to hit $60 billion by 2030, nearly double its current size.
At Busan, Korean director Yeon Sang-ho noted animation's strength: "how quickly you can see results and experiment with new ideas." Animation scales globally, can be produced anywhere, and avoids ballooning costs. Sony's Hayate investment and PlayStation-Crunchyroll integration show platforms doubling down on animation. Tariffs would accelerate this shift away from US live-action production.
The bigger threat Trump ignores: Netflix has 270+ million subscribers; two-thirds are outside the US. The company is investing in Japanese series like "Last Samurai Standing" and Taiwanese director Leste Chen's "The Resurrected." Crunchyroll is restructuring around "regionally-empowered teams" for international growth. Meanwhile, Japan's U-NEXT, Korea's Wavve, and China's iQiyi continue to build streaming, subscriber bases.
Implementation would be a regulatory nightmare. How do you tariff digital content delivered via streaming? Based on production location? IP ownership? Distribution platform? Compliance costs would require new tracking systems, legal reviews, and platform-level changes—all for negligible revenue that would likely violate trade agreements.
Trump already placed tariffs on Chinese entertainment merchandise. American consumers now pay more for Pokémon cards and Superman figures. Content tariffs would hit the entire IP value chain.
Three realities matter: First, Trump's pattern suggests this won't happen. Markets barely reacted because investors discount these threats. But uncertainty still disrupts deal-making and platform investments like Netflix's Creative Asia program, an “Asian” program, run by a US company with the bulk of its employees in the United States.
Second, implementation is functionally impossible given streaming's globally distributed supply chain and digital delivery.
Third, the threat creates opportunities for competitors. While US platforms navigate policy uncertainty, Asian services can move aggressively on content deals, talent, and AI production tools. As BIFF director Karen Park noted, Netflix "played a crucial role in breaking down barriers"—but that door swings both ways.
The streaming industry's challenge is adapting to a global marketplace where audiences want diverse stories and platforms compete on engagement, not national origin. Netflix's Busan conclusion was clear: "Asia's creative ecosystems are central to the future of global streaming." Sony's Crunchyroll bet over theatrical reinforces this.
Trump's tariff would accelerate the trends it claims to address: more offshore production, greater reliance on international content, Asian platforms gaining share. US streaming platforms currently dominate globally and generate trade surpluses. Tariffs would undermine those advantages while raising costs for American subscribers—exactly when platforms face slowing US growth.
Trump's proposal will likely join his abandoned threats. But it reveals policymakers don't understand the industry they claim to protect—or that streaming's competitive dynamics are global, digital, and impossible to wall off with 20th-century trade policy focused on theatrical releases when the real money is in subscription services and integrated entertainment platforms.
Douglas Montgomery is CEO and founder of Global Connects and a 20+ year veteran research and analyst in the entertainment and retail space.
Industry Voices articles are opinion columns and don’t necessarily represent the views of StreamTV Insider.