Apple’s Shrinking Theatrical Window

Flashy Pixels Issue 24: Apple’s Shift in Release Strategy Reflects Deeper Struggles in the Streaming Space

There was a time when A-list movie stars avoided commercials, especially in domestic markets. That unwritten rule has faded, with even Hollywood’s biggest names now appearing in ads. Consider Matt Damon's ill-timed cryptocurrency ad proclaiming, 'fortune favors the brave' just before the crypto market crashed.

The new signifier of A-list movie stardom is that you only appear in movies with a theatrical release, no direct-to-streaming. George Clooney recently underscored the value that actors still place on the theatrical experience during an interview with Deadline. Discussing the process of shopping his new movie, Wolfs, to potential buyers, Clooney stated, "Brad [Pitt] and I made the deal to do that movie where we gave money back to make sure that we had a theatrical release." 

Apple TV+ acquired the rights to Wolfs three years ago. The plan was to release it during the Venice Film Festival and then roll it out into theaters using the Paris Olympics as one of the promotional tentpoles. On August 7th, Apple abruptly announced that Wolfs would bypass a traditional theatrical run, opting for a direct-to-streaming release with only a one-week theatrical engagement in select theaters. 

Matt Dentler, head of features at Apple Original Films, tried to spin the decision positively, claiming, "Wolfs is the kind of big event movie that makes Apple TV+ such an exceptional home for the best in entertainment." However, not everyone shared this enthusiasm. The film's director, Jon Watts, expressed his dismay at learning about the changed release strategy mere days before the public announcement.

This incident is part of a pattern emerging around Apple's foray into original content production. The tech giant has gained a reputation in Hollywood circles for its lack of transparency regarding the distribution and promotion strategy of the shows and movies it acquires. Alena Smith, creator of the Apple TV+ series Dickinson, articulated this frustration in an article for Harper's Magazine, citing a "radical information asymmetry" in understanding Apple's priorities and metrics for success.

Apple seems to be applying its notorious 'need-to-know' corporate culture to the streaming world, much to Hollywood's frustration. This strategy has served the company well in its hardware development, allowing it to create buzz and anticipation for new products through carefully orchestrated events. However, the entertainment industry operates on different principles. Apple's reluctance to adapt has led to friction with industry talent, who feel more like a link in their supply chain than a valued collaborator.

Apple's recent box office performance highlights the company's challenges in the entertainment industry. Despite featuring top-tier talent and significant budgets, Apple Originals like Killers of the Flower Moon, Napoleon, Argylle, and Fly Me to the Moon have all underperformed. These outcomes raise concerns about Apple's ability to effectively market and distribute its theatrical releases.

Five years in, the industry is still puzzled: What is Apple’s endgame in streaming? “If this whole division went away, I don’t know that you’d see a difference in Apple’s business.” Says The Ankler’s Richard Rushfield. “The brand halo effect I’ve never bought from day one. It’s going to help get people talking about Apple, but eventually, they are going to start talking about how much of a disaster this is.” 

While the company's resources and brand power give it significant advantages, the unique challenges of the entertainment industry have proven to be a formidable test of its adaptability and strategy. However, Apple is a three trillion dollar company, so all this streaming investment is a rounding error on its balance sheet. The question now: Can Apple pay enough to make movie stars forgo theatrical releases entirely? Matt Damon’s agents are likely on standby.

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