In December 2020, WarnerMedia — the entertainment conglomerate that owns Warner Bros. and HBO — announced they would be releasing their entire 2021 movie slate on their new streaming service HBO Max, in addition to regularly scheduled theatrical releases. Despite earning Wall Street and Silicon Valley’s praise, their unforeseen decision has been enveloped in controversy, sparking public outrage from high-profile actors, lobbyists, and filmmakers, including Tenet’s Christopher Nolan, Wonder Woman 1984’s Patty Jenkins, and Dune’s Denis Villeneuve. 

Many major studios have used the ongoing pandemic to launch or endorse their streaming services; in fact, WarnerMedia’s HBO Max has spent the year competing against new rising stars like Disney’s Disney+ and NBCUniversal’s Peacock. However, this explicit divergence from Hollywood’s distribution model threatens the theatrical exclusivity that cinemas — notably, small, independent cinemas — heavily rely on to bring in revenue. Furthermore, should WarnerMedia’s streaming experiment pioneer a more profitable way to mass-release films? Will the voices of independent movie studios have as big of a voice in a streaming space dominated by big-budget blockbusters? 

On March 16, 2020, Canada’s largest cinema franchise, Cineplex Inc., announced that they would be temporarily closing their doors on all of their 165 theatres in response to the coronavirus pandemic, with independent theatres issuing similar statements. Nearly one year later, Cineplex Inc. has been able to sell assets to manage debt, but many independent cinemas are facing shutdowns. Health concerns and a lack of films available for theatrical distribution have taken the lives of many long-standing community cinemas across Canada — most recently, the ByTowne Theatre in Ottawa.  

For many independent cinemas, hosting online movie nights and monetary community support have been generating enough revenue to keep them alive. However, critics are speculating that, even if indie cinemas survive the full vaccine rollout, WarnerMedia could set a new distribution precedent that could inflict long-term financial damage on domestic theatres. 

The Independent Cinema Alliance has voiced their concerns to WarnerMedia, pleading for them to reverse their decision due to the value of theatrical exclusivity (a period of traditionally 90 days where a film can only be seen in theatres). Basic supply and demand models can explain why this trend is dangerous specifically for small theatres: if people can enjoy the same eccentric and artistic films that are exclusive to indie cinemas from the comfort of their homes, streaming services become a very favourable substitute for cinemas. When consumers are presented with a more convenient option, it is inevitable that some will forego the cinematic experience and download HBO Max, therefore, decreasing independent theatre demand and driving down their revenues. 

In predicting the future of independent cinemas, we must consider the consumer as much as the distributor. Therefore, it is undeniable that this streaming service choice will make 2021’s most anticipated films much more accessible and affordable. 

When accounting for transportation, tickets, and concession, a night at your standard cinema could cost you approximately $30 in tickets and snacks; however, for American consumers, HBO Max is priced at 14.99 per month and contains a catalogue of over 10 000 hours of content. For half the price of a single night at the movies, one has access to all HBO Originals, the full DC Universe collection and the Harry Potter TV series, classic sitcoms like Friends, and more, in addition to their highly anticipated 2021 movie slate. 

COVID-19 has infected over 100 million people worldwide, with over 26 million in the United States alone. While President Joe Biden intends to administer 100 million vaccine shots in his first 100 days of office, the pandemic rages in America, causing alarming rates of anxiety and unemployment in its wake. Both the safety concerns surrounding the pandemic and the glaring recession that many Americans face make streaming a very favourable option — but not for everyone. 

At a superficial level, streaming seems like the most accessible form of distribution. However, there’s a broadband internet divide in the United States of America that excludes rural communities. According to the Federal Communications Commission, 39% of rural American communities lack access to high-speed broadband internet; therefore, the shutdown of local theatres in favour of streaming would eliminate a large population of potential customers 

So, is this the end of the movie theatre experience? Innis College Principal and former Cinema Studies Director, Charlie Keil, is doubtful, further explaining that the “call for cinema’s death” is one that has occurred so often in the face of new technology that it borders on the edge of “self-parody”.  

“Given all the technological competition it has had to contend with, it has proven to be an incredibly resilient media…” he says, “[However] it’s not necessarily that cinema itself will die, so much as certain variants may have a tougher time.” And those variants are the independent theatres. 

Dr. Keil uses the “media behemoth” Walt Disney Pictures and their recent acquisition of 20th Century Fox to demonstrate a scary shift for the independent theatres and the studios who fund them. Searchlight Pictures, an independent offshoot of 20th Century Fox, has produced some of the best indie films of recent years, like Slumdog Millionaire, 12 Years a Slave, and The Grand Budapest Hotel. However, with Disney’s family-friendly policies, Dr. Keil wonders if Disney will have the desire to keep Searchlight Pictures alive.  

Studios rely on the theatrical release process to generate revenue, and Avenger’s Endgame’s $2.503 box office earnings illustrate that clearly. However, as studios acquire or create their own streaming platforms with their private blockbuster agendas, Dr. Keil asks, “Who will be left to serve the independent cinemas?”  

Hollywood’s distribution arm has fuelled independent cinemas across the continent for centuries; however, WarnerMedia’s disruption of that flow greatly jeopardizes the small businesses that highlight the diversity of today’s film landscape. With revenues impeded by the pandemic and content being snatched up by Netflix and other streaming services, the future of independent theatres can feel grim. However, with unprecedented change comes a surge in unprecedented creation. By continuing to support local cinemas and businesses, let’s hope that we can all take part in observing that creation together.