Remember when Netflix’s competitors, like Warner Bros., kept their biggest stuff on their own streaming services? That’s so 2021.
Would you like to watch Dune, the big, sweeping sci-fi epic, starring Timothée Chalamet and Zendaya?
If so, you can head over to Netflix, which started streaming the 2021 movie this week.
Then again, if you have Max, the streaming service owned by Warner Bros. Discovery (WBD), you’ve been able to watch Dune for almost two years, which makes sense: WBD also owns the Warner Bros. movie studio that made Dune. And you can still watch Dune on Max now.
It’s not unheard of to have the same movie playing on multiple services: You can also, for instance, watch Wolf of Wall Street on both Netflix and Paramount+. But Dune is different for a couple of reasons. And the reason its appearance on Netflix is important is that it tells you how Hollywood and Wall Street have changed the way they look at streaming.
A very brief history of the streaming wars: For years, movie studios and TV networks were happy to sell Netflix their old stuff. Then they realized they’d helped build Netflix into a major competitor and changed their minds. Led by Disney, the big studios stopped selling Netflix their best stuff and put those movies and TV shows on their own services instead.
That’s why Jason Kilar, the former CEO of WBD’s predecessor, thought he was doing the right thing by making all the Warner Bros. movies that came out in 2021— including Dune — available to stream on his service the same day they were in theaters. Part of the logic was that it would be hard for most people to see movies in theaters because of the pandemic. The other part was that Kilar wanted to give people a reason to subscribe to what was then called HBO Max.
But that was the old way Big Media thought about the streaming wars: spend a ton of money to build up Netflix competitors, and don’t worry about losing money because that didn’t bother Netflix either.
That point of view expired more than a year ago, when Netflix lost customers and saw its stock tank, and then Wall Street decided it was no longer going to encourage media companies to lose money building streaming services as quickly as possible.
Now, Wall Street is pushing big content companies to turn their spending way down and find new ways to make money from the stuff they have. Which is what WBD did earlier this year when it licensed a bunch of HBO shows to Netflix. And that’s at least part of what’s happening here with Dune.
One difference, though, is that when it came to HBO shows, WBD sold its competitor Netflix older titles, like Band of Brothers or Ballers, but not its marquee stuff, like Game of Thrones or Succession. Dune is a recent movie, and a big one: It grossed more than $400 million at the box office, even though it was released when lots of movie-watchers were still avoiding theaters because of the pandemic.
So you might think WBD would want to keep Dune on Max, especially since its sequel, originally scheduled to debut this fall, will come out next spring. New movie = new opportunity to tell people about the old movie and where to watch it exclusively, right?
Nope. Instead, WBD people tell me, the company made two calculations: One is that licensing Dune as a “co-exclusive” to Netflix, just like selling HBO shows to Netflix, will generate some cash for a company that needs cash because it has close to $50 billion in debt. And the other is that putting the first Dune on Netflix could help generate more ticket buyers for Dune 2 when it debuts next year.
And that second idea seems … plausible? For starters, Dune has been streaming on Max for a while, so anyone who wanted to subscribe to see it has probably already done so. And also, it’s entirely possible that Netflix, with its giant subscriber base, could indeed generate interest in a new movie.
After all, it’s pretty well established that reruns can do very, very well on Netflix. See: Breaking Bad, The Office, Friends, and now … Suits? And HBO programming boss Casey Bloys told me last week that HBO reruns on Netflix were spiking interest for the same shows on Max. It’s decent odds that this might also work for a sprawling movie starring two of pop culture’s biggest stars.
Which is a very long way of saying that while there are lots of people in Hollywood worried about Big Media’s about-face on streaming — in particular, people looking to make or sell projects streamers would have snapped up a couple of years ago but won’t touch now — there is some upside, at least for consumers: If your favorite movie isn’t on the streamer you subscribe to, just wait. It may get there eventually.