I’ve read all sorts of hot, cold, and warm takes on the pending Warners deal and it’s kind of shocking (it’s not) how many of them are rooted in amnesia. Let’s start here:

Every studio and production company that made a streaming deal with Netflix contributed to Netflix having more leverage than them.

Netflix built a pipe for digital delivery and studios supplied the content that kept Netflix’s audience subscribed. Then studios thought to themselves, gee, this is great! Why don’t we build our own digital platforms to compete with Netflix without knowing how to do it? I mean, Paramount+ was a poorly coded wrapper slapped on top of CBS All Access for years. I wouldn’t be surprised if some legacy code is still built in. And to this day, it doesn’t have the metadata visible for even obvious categories like the film’s director. Do you know how hard it is to watch James Bond movies in order on Pluto? It’s not hard at all on Amazon Prime, but then a licensing window closes and the content moves somewhere else.

You all know what platform has the best Metadata. Amazon. Jeff bought IMDb and everyone continues to give their metadata to IMDb and then pays them for Pro (I, too, pay for Pro). Do you see a trend? Give MGM a few years and it’ll be bumping – more on that later. Entertainment likes to give things to tech and tech gives virtually nothing back. That’s what the Ellisons learned with Java. To his credit, Larry kept everyone using Java, and, in turn, just asked for little more than data. Now he’s bought half of Hollywood with his kids. There’s no use complaining about acts of God, but I do wish Megan was given a bit more of the decision making.

The irony is that when the studios of yore made a deal with creatives they knew how to be greedy. They kept the lion’s share to justify their overhead with a fat cat profit margin to keep execs in pressed suits and private jets. VHS tapes used to cost video rental stores an absolute fortune and last about 30 plays. Then Netflix started putting those inexpensive and highly reusable DVDs in the mail for the studios with a nice cut. The studios let it happen without worrying about the future. But the future was a frame straight out of Terminator as technology surpassed the need (not the want) for physical media as broadband adoption in the home made digital content delivery no longer a commercial restriction. Now the studios scramble to haphazardly get their movies onto any platform that has eyeballs with little cohesion for building brand loyalty. I’ll give Disney a pass there cause boy howdy do they know how to feed their youth enthusiasts.

Let’s face it – the endless reactionary moves signal that entertainment is poorly equipped to fight a technologically superior foe. It’s a losing chess match where tech is thinking 3 moves ahead. Maybe it’s because I started in tech before moving to entertainment, but isn’t it obvious to like anyone (me for sure) why Google, Apple, Amazon, and Netflix are spanking the traditional studios? As much as I hate giving credit to Discovery for this, they are the only major player that started as a television company. The Paramount Decision was struck down 5 years ago. We have theater-level digital delivery of DCPs so studios can program any film in their catalogues with an ounce of effort. Why are studios not running their own blocks in empty theaters?

So here’s the question behind The Netflix Paradox: how do studios right the ship without failing to become their own Netflixes? Here’s my dollar store answer – turn theaters into malls for movies. I think it starts with a company like MGM that has nothing to lose. They start renting out dedicated space in movie theater chains and program whatever the hell they want. Put MGM branding inside the multiplex and wrap their theater in MGM pastiche. Make it like a birthday party that never ends. But a cool one at an entertainment facility like Discovery Zone. Invite whoever you want, whenever you want. Give your subscribers special privileges. Invite film crews as guests, throw screening series, do movie tie-ins, run midnight movies. Sell DVDs and BluRays in vinyl-wrapped junkyard Redbox machines right next to your merchandised shelves full of toys and posters. Make going to the movies an experience. In a future era of AI slop, the magic of the movies is the best tool to fight back against everything going full Skynet.

Turn the movie-going experience back into an analog one. Celebrate the craftsmanship like any of the great exhibits at The Museum of the Moving Image or The Academy Museum with displays of great props and costumes. And here’s the back end of the Netflix Paradox – this is the best way for Netflix to get into the theater game beyond buying a historic qualifier in Hollywood or New York. Minimal risk and a pipeline to get their best stuff out of home. Imagine a double feature of The Covenant + A House of Dynamite. Let’s moonwalk on the Guy Ritchie and maybe do The Gentlemen Season 2 with a Twinings brand deal instead because you’re welcome. Shout out to Theo, who was a class act on The Benefactor. I do love Kathryn… maybe A House of Dynamite X Propanolol brand deal?

And this won’t be a phenomenon that favors only the big boys. A Blumhouse or an A24 theater would be packed with the fan crops they’ve cultivated. Hell, I think every studio should do this. It would save theaters from a grueling death and give them a little dignity in running the mall. You’ll know that a theater is serious business when studios are involved in upgrading the projection equipment and maintaining the seats a la IMAX. With the decline of the movie theater, it may be time for the theater chains to buy in to the idea of inviting the studios directly in, converting the rental business to B2B and allowing the studios to acquire the customers directly. The studios would have a really strong opportunity for marketing budgets that have a horizon versus evaporating into the ether once a film is past its first window. This would bring back good old fashioned competition and the proof will be in the quality of movies that live in each theater’s studio “store.” And, if you haven’t caught on yet, the way around the risk associated with opening your own theater chain is to rent space in the movie mall.

If you believe that a WBD theater running a 3 hour block of 90 Day Fiancé wouldn’t bring unprecedented numbers of women to theaters to enjoy some quality time together screaming and throwing popcorn at the screen you should just quit entertainment right now. My sources say a block of Project Runway at the Disney theater next door would cause a full-blown riot. So that’s The Netflix Paradox. For movies to be saved, streamers need to rent theaters.

If sports teams can create a global phenomenon of fan loyalty, why can’t movie studios?