AT&T Pisses Off Everybody (Especially Christopher Nolan) For Launching Movies Straight To Streaming

Movie Industry

from the right-idea,-wrong-implementation dept

To be clear, AT&T has no shortage of nasty habits, whether we’re talking about how the company routinely does too little to thwart criminals eager to rip off AT&T customers, or the way it can routinely be found hoovering up taxpayer money in exchange for, well, less than nothing. But one thing the company did get correct (or at least more correct, more quickly than other counterparts in cable and TV) was that streaming was the future.

Most cable TV companies refused to fully embrace streaming, worried they’d cannibalize existing traditional cable revenue and thinking they could milk a dying cash cow forever. AT&T jumped in with both feet early on, launching a dizzying array of different streaming services. Sure, AT&T then proceeded to lose seven million pay TV and streaming customers in just three years thanks to a series of bone-headed mergers, rate hikes, and idiotic branding choices, but its original instinct to get out ahead of the problem was the right one all the same.

Earlier this month, AT&T announced that Covid had forced it to effectively put a bullet in traditional movie release windows, resulting in the company releasing new Warner Brothers films on streaming the same day they’re released in theaters. It’s obviously a necessary response to an unprecedented threat, and it comes with some caveats. One, it’s only a one-year trial. Two, movies will still hit theaters. Three, you’ll probably pay more for home viewing than is sensible. It’s likely a temporary shift in tactics that’s geared as much toward goosing lagging HBO Max subscriptions as it is public safety.

Still, the decision resulted in no limit of consternation in Hollywood, which was already sore about AT&T’s steady parade of layoffs at Time Warner properties (HBO, DC) it acquired in 2018 (promising no limit of amazing synergies), and the general annoyance of having bumbling telecom executives stumbling around a more creative, competitive sector than AT&T’s used to. Director Christopher Nolan was particularly pissed off:

“Some of our industry?s biggest filmmakers and most important movie stars went to bed the night before thinking they were working for the greatest movie studio and woke up to find out they were working for the worst streaming service.”

Ouch. For a company that’s struggling to keep pace with the likes of Amazon, Disney, and Netflix, that’s not exactly what you want to hear. Nolan’s biggest gripe is that AT&T, in a rush to drive HBO Max streaming adoption and please Wall Street, doesn’t really understand what it’s dismantling as it works to pivot from brick and mortar releases to the virtual world:

“Nolan said that the Burbank, CA lot was ?dismantling? an ideal distribution system between theaters and homes ?as we speak. They don?t even understand what they?re losing. Their decision makes no economic sense and even the most casual Wall Street investor can see the difference between disruption and dysfunction.”

Of course this being Hollywood, a chunk of this is just errant hyperventilation. Hollywood has long despised any attempt to disrupt the traditional movie release window, despite the fact it’s an antiquated construct that doesn’t make a whole lot of sense during the broadband and streaming era. This is not an industry that takes change or disruption particularly well, and that’s pretty well evident here.

But it would be a mistake to suggest this is entirely just Hollywood being afraid of change, and Nolan’s not entirely wrong.

Having written about AT&T for twenty years I can assure you the company doesn’t really know what it’s doing in the entertainment space. AT&T’s good at two things: running networks and lobbying the government to kill competition. And while it tries to hire competent entertainment-sector executives (like Warner Brothers Chief executive Jason Kilar) those executives will, sooner or later, run up against rigid-minded executives from a government-pampered telecom monopoly that don’t really understand (or care to understand) how creative ventures work.

That was reflected in AT&T’s early streaming headaches, it’s reflective at the consternation at HBO and DC Comics, and it’s also apparent here. Despite a lot of pretense to the contrary, AT&T is making it up as it goes along:

Nolan claims AT&T didn’t really bother to fully consult with Warner Brothers folks before undergoing such a massive pivot, one that’s going to hit union employees particularly hard (something I’d wager, based on its history, AT&T’s not too broken up about):

“The director called the decision by WarnerMedia, owned by tech giant AT&T, as devaluing billions in film assets ?by using them as leverage for a different business strategy without first figuring out how those new structures are going to have to work, it?s a sign of great danger for the ordinary people who work in this industry.”

Dune director Denis Villeneuve was even more blunt in a piece at Variety:

“There is absolutely no love for cinema, nor for the audience here. It is all about the survival of a telecom mammoth, one that is currently bearing an astronomical debt of more than $150 billion. Therefore, even though ?Dune? is about cinema and audiences, AT&T is about its own survival on Wall Street. With HBO Max?s launch a failure thus far, AT&T decided to sacrifice Warner Bros.? entire 2021 slate in a desperate attempt to grab the audience?s attention.”

Again, this is all a bit more complicated than Hollywood being a disruption-phobic baby (though that’s absolutely part of the equation). Everything about AT&T’s venture to dominate streaming has been a convoluted mess, including the $200 billion in megamergers that saddled AT&T with so much debt it resulted in an investor and consumer revolt. So while pivoting hard(ish) to home releases is the right move at the right time, there’s absolutely no indication that AT&T’s the kind of company capable of doing a good, conscientious job at it based on what we’ve seen so far.

In short, AT&T’s right to adapt to the historic health threat at hand by pivoting hard to streaming, but creatives under the AT&T/Time Warner flag are also probably right to worry that a pampered telecom monopoly with a long history of dodgy ethics will do a crappy job at it.

Filed Under: chris nolan, covid, day and date, hbo max, home release, movies, release windows
Companies: at&t