Wolk’s Week in Review: Memorial Day moviegoing tanks, Charter and Paramount continue The Great Rebundling

Wolk's Week In Review

 

1. Memorial Day Moviegoing Tanks

American movies experienced their worst Memorial Day weekend since 1995, with box office at around half of what it’s been in banner years.

Part of that is due to misjudgment around the two tentpole movies.

Garfield, the lasagna-eating cat, is regarded as an embarrassing relic of what passed for humor in the 80s, while Mad Max seems to hit a little too close to our current reality for comfort. And that’s before you dissect the name “Furiosa” which sounds like it could be a moody Zoomer recording artist or a suggestion on how to play a piece of classical music. Take your pick.

But mostly the decline is due to the fact that seeing movies these days is largely an unpleasant experience coupled with the shrinking cultural cachet of film as a medium.

Allow me to explain.

Why it matters

Let’s start with the more existential of the two issues: films have nowhere near the cultural impact they did in years past.

There are many reasons for this.

There’s the almost complete disappearance of the sort of independent films that dominated the 80s and 90s coupled with the dominance of films based on comic book superheroes and other “IP.”

I mean the fact that you can even make reference to “IP” without having to explain what it means pretty much tells you all you need to know.

Independent films disappeared for two reasons.

The first is that they’re now being made into TV series. Blame it on Mr. Robot, the dystopian USA Network drama that made Sam Esmail and Rami Malek’s careers. The story was originally designed to be a movie but Esmail realized he could tell it better in 10 episodes and NBCU was willing to write a check and so a trend was born.

The Netflix hit, The Queen's Gambit, is a more recent example of a TV series that started out life as an unwanted movie script but succeeded as a TV series where the story could be fleshed out.

Then there’s what I’ll call the Netflix Effect.

Netflix and other streaming services frequently buy the rights to small independent films. This is great for the filmmakers as Netflix pays them a good chunk of change. 

The problem is that many charge that Netflix and other streamers do nothing to promote their movies, which then sink into the vast library where they remain largely unseen. 

Or as one filmmaker told me not all that long ago, “At least with art houses we knew people would see it. Film critics would write articles about it. There was the possibility to create some sort of buzz.”

So there’s that and there’s the fact that TV series got a lot more highbrow (think Succession or BoJack Horseman) at a time when movies got a lot more lowbrow. While Marvel movies may do well at the box office thanks to a young male demographic, those movies are also kryptonite for a different demographic, the one that gatekeeps culture for us. Thus, TV became much more culturally relevant among people who value cultural relevance.

Or, to put it another way, the New York Times did not run 10 stories in a single day about the latest Spiderman movie. Succession, OTOH….

Then there’s the physical issue, or how much actually going to the movies sucks.

There is, first and foremost, the disappearance of many movie theaters during the pandemic. To use my own life as an example, there used to be a theater in downtown Millburn, the New Jersey railroad suburb I live in. (Railroad suburbs have small walkable downtowns built around a train station.) The Millburn theater closed down during the pandemic, as did the theaters in the two adjacent railroad suburbs, Summit and Maplewood. So rather than the somewhat low-key possibility of dinner at a local restaurant followed by a short walk to the theater, going to the movies now involves a trip to a large multiplex off the side of a highway many miles away.

Then there’s the actual experience in the movie theater. 

People talk. They use their brightly lit phones. They talk on their brightly lit phones. They bring small children to adult movies. They spill things and leave empty boxes lying about which are rarely cleaned up between shows. Popcorn and a bottle of water can cost close to $20. There is a seemingly endless array of ads and pre-movie trailers.

So it should not be surprising that people want to stay home and watch on their 75 inch screens, knowing full well that shorter windowing means they can see the movie about a month or so after it opens, and that even if they have to wait two months, it’s the rare film these days that seems to demand immediate viewing.

What you need to do about it

If you are a streaming service, realize that one of the reasons people like watching movies on streaming is that they can be viewed in several sittings, especially those three hour plus opuses that people making Very Important Films seem to favor. And that those three hour-long sittings are a lot easier to schedule than the 10 hours needed to watch most streaming series. 

TL;DR: keep making and buying movies.

If you are a Hollywood studio, realize that you are at a crossroads. You can continue to program for teenage boys and international audiences, but it seems you may have already milked those audiences for all they are worth. 

Meaning it’s time to put more effort into finding those breakthrough stories. Maybe even finding some promising TV scripts and convincing the writers that what they have would make a really good movie.

You’d also be well served by figuring out how to make moviegoing a better consumer experience. Which means doing some research into where and why people are still going to the movies. What you can do to bring them back to theaters. Or whether you should even try to bring them back to theaters.

If you are the industry in general, it may be time to start contemplating the unthinkable, that movies as watched in an actual movie theater are an artform that made sense for around 100 years but which have now evolved into being another form of at-home entertainment, and no amount of marketing and technology and physical improvement is going to change that trajectory.

That’s a tough one to swallow, but it may just be where we’re headed.

Sit with it.

2. Charter and Paramount Continue The Great Rebundling

Of all the MVPDs, Charter seems to really get where the industry is heading. Hence their deal several months back with Disney where they traded carriage for discounts on the Disney streaming bundle.

This week comes news they’ve struck a deal with Paramount to offer the ad-supported versions of Paramount+ and BET+ to their subscribers for free.

This is not Charter’s first deal with Paramount either. Charter subs who subscribe to Showtime also get ad-supported Paramount+ thrown into the mix.

Why it matters

Charter has over 28 million residential broadband customers.

I could stop there and that would be reason enough, but the key to streaming subscriptions is going to be to bundle them in with broadband. 

Sure, you can throw in things like audio and newspaper subscriptions, but the reality is that Spotify doesn’t have much of a churn issue, so has less incentive to join a bundle.

SVOD services, OTOH…

As per Bevin Fletcher at StreamTV Insider, Charter is even actively pushing Paramount’s services to its broadband subscribers, making use of its “nearly 25,000 onshore, in-house marketing and sales employees to offer Paramount’s streaming services for retail purchase to its broadband-only customers.” 

Talk about sweetening the deal. 

Also notable is that Charter is pushing the ad-supported version of Paramount+. At the risk of sounding like a broken record, you will be seeing this a lot—the subscription services need to give people a financial incentive to choose the ad-supported version, because if the difference is just $5 or $10, then it’s going to be hard to convince people to go ad-supported, particularly if they are signing up to see a specific show.

That’s notable too because it puts the scenario we’ve been calling “15,000 Merits” into sharper focus. 

“15,000 Merits” is the title of a Black Mirror episode about a world where every surface in a room gets turned into an immersive ad and the only way to turn it off is to pay, “merits” being the currency of that particular world.

In our own world, more affluent people will most definitely pay to avoid ads on TV and will install multiple ad blockers on their phones and laptops. Meaning that there will be an important cohort of consumers who can only be reached during live sporting events, making the value of said events that much greater.

So there’s that too.

What you need to do about it

If you are Charter, take a bow, you are definitely leagues ahead of your peers in figuring out how to skate to where the puck is headed.

Ditto Paramount who has been ahead of the pack in that regard, too—Walmart+ subscribers, for example, get a free ad-supported Paramount+ subscription.

If you are the rest of the industry, bundles are the future, so is broadband, figure out a way to make that work for you. There are all sorts of permutations on how that could end up, but the key thing to keep in mind here is that people who are afraid of churn are going to be the most motivated.

Go for it.

Want to be up to speed about what’s on the horizon for free ad-supported streaming TV (FAST)? Join Alan Wolk and a lineup of industry leaders for TVREV’s Future of FAST Supersession June 24 at the StreamTV Show in Denver. Register today to hear the latest on the state of FAST, detailing what you need know, why it matters, and what you need to do about it.

Alan Wolk is co-founder and lead analyst at the consulting firm TV[R]EV. He is the author of the best-selling industry primer, Over The Top: How The Internet Is (Slowly But Surely) Changing The Television Industry. Wolk frequently speaks about changes in the television industry, both at conferences and to anyone who’ll listen.

Week in Review is an opinion column. It does not necessarily represent the opinions of StreamTV Insider.