Remember Qwikster? No? Sure you do. In 2011, Netflix decided it would spin off its DVD-by-mail service, long the backbone of the company, in order to more closely associate the brand name with streaming, which was rapidly becoming its primary offering. That DVD offshoot would be called Qwikster, and it would require a separate subscription. In theory, that was a good idea. In practice, it was a calamity. Users revolted over the price hike and confusing new plan. Netflix lost 800,000 subscribers in a single quarter, and the stock price collapsed. Spinning off DVDs under another name was an attempt to further establish Netflix as a streaming destination, while also creating another related brand. The problem was that Netflix, one of the most successful companies of the digital age, thought it could impose its will no matter what. Turns out, customers don’t like it when costs double without warning, regardless of how many episodes of Buffy the Vampire Slayer they can stream.
Fast-forward to 2015, the year of “Netflix and chill,” and you can nevertheless see the foresight in that ultimately ill-fated decision. Whether or not CEO Reed Hastings knew that his company’s name would become synonymous with teens making out, he did realize that streaming was the future, and particularly the future of Netflix. Here we are, then: You Netflix-and-chilled this weekend, and maybe, just maybe, you watched Beasts of No Nation, the new film from writer-director Cary Joji Fukunaga, starring Idris Elba as a warlord in Africa leading an army of child soldiers. As Netflix’s first original movie—the company paid a hefty $12 million for it a year ago—Beasts represents not only the company dipping a toe into the pool of feature filmmaking, it also signals a shift in the increasingly volatile picture of how movies are released. According toVariety, Netflix plans to spend $500 million on original content in the next year alone, and each project will debut on streaming either before or in conjunction with its debut elsewhere.
Putting your movie in both theaters and on VOD at the same time is what’s called a day-and-date release, and it’s been on the rise for a few years, as indie distributors try to figure out the best way to seed their products into an increasingly crowded marketplace. Beasts of No Nation premiered Friday, October 16, on Netflix. It also received a limited release in 31 indie theaters. While day-and-date might seem like an attractive option—let people pay to watch your movie however they want to do so—it’s a complicated prospect. Many theaters have a 90-day window of exclusivity between the theatrical release and VOD availability, meaning that if you want to screen at those theaters, day-and-date is out of the question. A number of the distributors that use day-and-date aggressively also have a corporate presence in theaters—for example, Magnolia’s parent company owns Landmark—but for those without that kind of access, like Netflix, they’ll often have to do what’s called four-walling, which means buying out the entire theater ahead of time. Four-walling entitles a company to 100 percent of the revenue (and makes the movie eligible for Oscar consideration), but it comes with a cost: If those seats don’t sell, you eat the outlay.
One indie distributor I asked said that with the increasing number of films being released day-and-date, he’s starting to see the VOD takes drop. Movies of lesser quality are being mixed in with prestige films, and with some of the streaming services, he said, it’s hard to tell the difference: It’s a mess of indies competing for an overserved audience. In fact, his company is moving back to traditional releases, focusing on well-reviewed, high-quality indies that can sustain theatrical runs.
Beasts of No Nation, then, is a sort of petri dish for the Zeitgeist, colliding many different strands of distribution and release strategy. If we’re treating its theatrical release this past weekend like a controlled experiment, then it’s hard not to call it a failure. Beasts bowed to $50,699 from its 31 theaters for an average of $1,635. It’s hard to overstate how bad that is for a limited-release prestige picture; it’s the kind of average that you’d expect from a day-and-date indie with no star power, publicity, or theatrical expectations.
Of course, the situation here is different: An enormous percentage of folks who’d go to theaters to see an awards-worthy film like Beasts have access to Netflix. Since this is subscription VOD versus à la carte VOD, it also means that that movie, on Netflix, is adding very little to the company’s bottom line. The question becomes whether the value-add Netflix gets from the film is worth the $12 million it paid for it, plus the price of showing it in theaters. (Which, granted, did qualify it for the Oscars.)
Now, this isn’t Netflix’s first dalliance with distribution: Its partnership with the Duplass brothers has already resulted in a few very good films hitting Netflix very soon after short theatrical windows. Those are smaller movies, though, often made for less than or just a few million dollars, that are well suited for home viewing; also, Netflix doesn’t distribute them theatrically or have a guaranteed day-and-date, lessening the commitment. Beasts, on the other hand, is the whole enchilada: a difficult, dramatic war movie that most reviewers have urged moviegoers to seek out in theaters. Fukunaga, one of our fastest-rising filmmakers, has more cachet among the hyperinformed than he does with the general public, who, if they know him at all, might still think he’s involved with True Detective. While the Duplass deal showed a commitment to new film,Beasts is Netflix taking full responsibility for the dissemination of a movie.
If the Qwikster debacle taught us anything, it’s that just because Netflix does something doesn’t mean it’s the right thing to do. Beasts of No Nation is not Qwikster: It’s a movie with ardent supporters and pristine credentials, and it will almost certainly attract an audience during its run on the streaming service. But its dismal theatrical performance also shows that the praise surrounding its trailblazing release was optimistic, if not hyperbolic. As usual, Netflix’s instincts are spot-on. But for the first time in a while, we can subtract some points for the execution.