Viewpoint: Watch out movie theaters, Netflix is coming for you

Madi Miller
Madi Miller
Madi Miller

By Madison Miller

Online video streaming has been and is becoming one of the most common ways people watch their favorite television series and films. The problem with this is that eventually these online streaming systems will create a world without the need for movie theaters or movie distribution. The average attendance has decreased to 1.34 billion in 2013 from 1.5 billion in 2004, according to the Motion Pictures Association of America.  This decrease in attendance and profit will eventually cut down the profit films bring in from the box office.

We saw the collapse and bankruptcy of the Blockbuster franchise because of the changing economy and the availability to rent movies from places such as Redbox. I predict that eventually, if Netflix and other online streaming services continue to grow as they are, Redbox will no longer be necessary. Eventually we will see movie theaters the same way we see drive-in movies: a rare special event.

In 2010, Netflix switched its distribution method from mailing DVDs to video on demand. When buying a BluRay player, the remote control that comes with it has a one-click Netflix button that will automatically boot a Netflix account through the Internet connected to the BluRay player.

Netflix thrust itself into the film and television business by coining the term “binge viewing” with the creation of hit series such as “Orange is the New Black” and “House of Cards.”

According to Variety, an entertainment website, Netflix has launched two movie deals to create its own films. In a letter to their stockholders, Netflix announced that it will release a film called “Crouching Tiger Hidden Dragon II: The Green Destiny,” on Aug. 26. Based on Netflix’s track record, these movies are sure to be hits. Netflix has claimed that it is creating four feature comedies starring Adam Sandler. It decided not to have a theatrical release and to just release them online.

This is a problem. If brands like Netflix begin doing this, the traditional movie theater would no longer be of use and the way we watch newly released films would be forever changed. Although Netflix does not pick up all new movie releases, it is heading in that direction. It also raises the question as to what films will look like in the future. Will the creation of original films by Netflix hinder the quality of films being made or will it boost the creativity?

A prime example of the distribution issue was “The Interview.” The buzz around this film was not the actual film, but the distribution method. It was released by several different streaming sites such as YouTube for $7, which is cheaper than most movie theaters.

With this different distribution method, film companies are losing revenue with less and less attendance at the theater. Theaters are having to bump up prices to make profits on the films.

In an interview on YouTube in October with Douglas Anmuth of J.P. Morgan and Michael Nathanson of MoffettNathanson, co-founder and CEO of Netflix Reed Hastings said Internet TV is going to be everything in a couple of years.

“All the big networks are moving to internet video and it is becoming a very large opportunity,” Hastings said.

In Netflix’s quarterly letter to its shareholders, the company announced that it had a successful launch in France, Germany, Switzerland and other countries, which added 66 million households to its addressable market. This is not surprising, but it is worrisome. What will be the use of DVDs or movie theaters at the rate they are growing? They launched their international streaming four years ago and it has only gone up from there. In a letter to shareholders published Jan. 20, the international market gained 2.43 million members in the fourth quarter of 2014 compared to 1.74 million in 2013.

While I do like the idea of having films available online, I do not think that they should take over the film industry because it would hurt so many film companies as well as physical movie theaters. We need to cherish the act of going to the movie theaters because I fear our remaining time with them is limited.

Madison Miller is a senior journalism and film and digital media double major from Prosper. She is a reporter and regular columnist for the Lariat.