Grab Some Popcorn and Watch Theater Chains Fight Netflix Over ‘Crouching Tiger II’

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Well, that was fast. Less than 48 hours ago, we got word that the Weinstein Company and Netflix are partnering up for a sequel to Crouching Tiger, Hidden Dragon with an unusual distribution strategy: a simultaneous release online via Netflix and in IMAX theaters. Already, the four largest exhibitors in the country (AMC, Regal, Cinemark, and Carmike) have joined Canada’s biggest chain (Cineplex) and Europe’s second-biggest (Cineworld) to announce they will not screen the Crouching Tiger sequel if that release plan stands. Imagine my surprise.

This is not the first time they’ve pulled this kinda thing. Back in 2011, DirecTV launched a premium on-demand service, offering up Adam Sandler’s Just Go With It for $30, 69 days after its theatrical release. Chains threatened not to play trailers for films using the service, and filmmakers penned an open letter decrying this desecration of the sacred movie-going experience. It got uglier that fall, when Universal floated a plan to release Tower Heist on demand in two markets, three weeks after its theatrical debut, for the totally reasonable price of $60 — and the exhibitors lost their fucking minds, and when they threatened a boycott, Uni immediately backed off.

In the years since, the push-pull has remained, between the financial concerns of the powerful exhibitors’ lobby and the studio’s interest in maximizing advertising dollars by shrinking the window between theatrical and home media release. But in that time, simultaneous and near-simultaneous releases have proved something of a lifeline for struggling indie and specialty distributors, who put out their titles on-demand simultaneously with (and often in advance of) their theatrical debuts. Those release patterns keep them out of the chain multiplexes, whose policies blackball any movie available on-demand within the established “window.” But it’s not like they’d rack up a lot of bookings there anyway; besides, in many markets, they can play at Mark Cuban’s Landmark chain, which is itself heavily invested in VOD.

It gets tricky when you start talking about movies that could do well at the multiplex, if they were allowed to play there. The Weinstein Company got a taste of this last summer, when its VOD release of Snowpiercer, two weeks into a theatrical run that had (at that point) only reached 250 screens, turned into a success story for both platforms. Snowpiercer’s sci-fi/action leanings and snazzy cast could have made it a bigger theatrical hit than it was — yet because it was distributed by TWC’s junior, VOD-centric Radius label, bigger chains wouldn’t show it.

And that’s pretty much where we’re at on Crouching Tiger, Hidden Dragon: The Green Legend. The Netflix-and-IMAX strategy seems, to this observer anyway, to make a lot of sense; you can either see it at home, on your small-ish screen of choice, or you can go to the theater and see it on the hugest screen possible. But the four American chains participating in the boycott hold 257 of IMAX’s 418 screens in the US, and theatrical exhibitors are bound and determined to hold on to this archaic notion of exclusivity for as long as they can, whatever the cost.

The question is how long they’re willing to put their hands over their ears and scream at the top of their lungs. Box office revenues aren’t plunging like Michelle Yeoh leaping off a rooftop solely because people can watch movies at home. It’s because the theatrical movie-going experience is often a miserable one, filled with texters and “second screens” tolerated by theaters catering to their ADHD mindset of the 12-year-old boys the studio slates are geared towards, and these same exhibitors respond to falling profits by jacking up their prices and adding on surcharges for 3D and IMAX and RPX and, God fucking help us, 4D.

But there are a couple of factors here that could make this standoff noteworthy. Unlike the costly and ultimately barely profitable Tower Heist, Crouching Tiger II is a modestly budgeted movie (“in the $20 million range,” according to Variety) with name recognition, and it will probably make back its budget handily without even a US theatrical release; there are over 200 IMAX screens in China, for example, and no Netflix. Even more intriguingly, its domestic release date is August 28, 2015 — smack dab in the middle of the late-summer dry spell that resulted, last summer, in the worst grosses in years, and which some wise souls suggested Hollywood try plugging some high-profile movies into. In other words, TWC and Netflix have very little to lose here, and come next summer, as they’re staring at a slate dominated by that year’s equivalents of The Identical and As Above/So Below, the chains might realize they have everything to gain. It’s an entertaining showdown, and it’ll be interesting to see who blinks first.