Steven Spielberg is making his way over to Netflix (NFLX), the latest marquee Hollywood name to capitalize on the golden era of streaming, with multiple platforms shelling out billions for quality content.
The 3-time Academy Award winner inked a multi-year deal with the streaming giant through his production company, Amblin Partners. Under the terms of the deal, Amblin — the studio behind high-profile films like "1917," "The Trial of the Chicago 7" and "Green Book" —will supply Netflix with multiple movies per year over the course of the agreement. It is unclear if Spielberg will direct any of the films at this time.
Although the financial stipulations have not been disclosed, sources at both "Deadline" and "The Hollywood Reporter" say that the deal has no restrictions regarding budget or genre.
It's also possible that the films could have a theatrical release, in addition to a Netflix debut — similar to Martin Scorsese's "The Irishman" and Noah Baumbach's "Marriage Story."
Spielberg has a separate deal with Universal Pictures (CMCSA), which he still will be able to maintain under the new Netflix arrangement.
The announcement came as a surprise to many industry analysts, as Spielberg has consistently put his weight behind the theatrical experience. In 2019, the director reportedly voiced concerns over streaming films' equal treatment at the Oscars, believing it to be an inferior cinematic experience.
“Once you commit to a television format, you’re a TV movie,” Spielberg said during an interview with ITV in 2018. “You certainly, if it’s a good show, deserve an Emmy, but not an Oscar."
However, the industry's seemingly bottomless resources — as well as the heavyweight talent committing to streaming projects — may have swayed Spielberg's opinion.
"It just shows you how quickly the industry is evolving and changing," Comscore senior media analyst Paul Dergarabedian told Yahoo Finance.
"What was perhaps a truism, or a conventional wisdom a year or two ago, could be a completely outmoded idea today...The rulebook has been rewritten," he continued.
'The bandwidth is infinite'
Netflix, the behemoth in the space, currently has over 208 million global subscribers.
Led by Co-CEO and Chief Content Officer Ted Sarandos, the platform has consistently bet big on content and creators, recently spending a whopping $450 million to secure the next two "Knives Out" sequels. Prior to that announcement, the streamer revealed it would be dropping an original film every week in 2021.
Netflix's current deal with Spielberg underscores that content push, and allows the streaming giant to double down on its production pipeline.
"This is no small thing for the industry to have somebody like Spielberg — this high profile, this renowned — to strike a deal with a streamer," Dergarabedian said, adding that the move adds a level of prestige and acceptance when it comes to Netflix's place in the media world.
"Anything that Spielberg has his mark on is going to get noticed," he emphasized.
But the deal is beneficial for the world famous director as well. Dergarabedian cited Netflix's vast financial resources, creative freedoms and wide-reaching platform as key drivers in attracting top-tier creators.
"The bandwidth [for streamers] is infinite," he said, explaining that the deal symbolizes "how the lines are being blurred between big screen and small screen."
"I think most creatives today want to be able to work in both worlds — both streaming and theatrical because they're both here to stay," Dergarabedian continued. Yet he cautioned that "not all creative output is necessarily appropriate for the big screen promotion and marketing spend," whereas other films benefit from a theatrical-first strategy.
MGM, Beatles get big backing
Other streaming competitors have made big moves to compete. After news of WarnerMedia's (T) bombshell merger with Discovery (DISCA), Amazon (AMZN) announced it would be purchasing Hollywood studio MGM Holdings for $8.45 billion, a sign of how the hot industry is likely to see more big deals.
Meanwhile, Disney+ (DIS) has exclusively secured Peter Jackson's high-profile Beatles documentary. The upcoming series was originally set to debut in theaters, but will air in three separate episodes over Thanksgiving weekend.
"The flexibility and expansive nature of streaming is definitely appealing for long-form content like this," Dergarabedian noted, crediting the upcoming series' extended rollout as a unique way for fans to "immerse themselves in the [experience.]"
Despite the obvious streaming revolution, Comscore's Dergarabedian strongly believes the "the movie theater business is here to stay" — even if it looks a little different.
"I think the idea that every win for streaming is a loss for theatrical is misguided," Dergarabedian explained.
"F9" dominated the box office this past weekend, securing $70 million in U.S. ticket sales — the highest pandemic-era opening so far. The Vin Diesel action film stole the title from "A Quiet Place II," which earned $57 million in ticket sales during its Memorial Day weekend opener last month.
One of the industry's largest exhibitors, AMC (AMC), added to theatrical optimism after revealing on Monday that chains across the U.S. secured their busiest weekend since theaters shut down in March 2020 — with 2 million guests visiting AMC locations nationwide.
AMC has been a hot topic of conversation amid the meme stock trading frenzy, with many analysts casting doubt on the company's fundamentals with the stock skyrocketing over 2,500% year-to-date.
But separate data backs up AMC's recovery story.
According to foot traffic analytics platform Placer.ai, monthly visits to AMC cinemas across the U.S. have shown steady improvement. Visits were down 68.5% in May compared to May 2019 — a slight uptick from April when the visit gap stood at 70% and a significant boost compared to January when visits were still down over 80%.
More blockbusters are expected throughout the summer, with "Black Widow" making its domestic debut in July. Box office analysts anticipate ticket sales will continue to improve as more films come to market.
Alexandra is a Producer & Entertainment Correspondent at Yahoo Finance. Follow her on Twitter @alliecanal8193
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