Yahoo Finance AT&T Boss John Stankey Says Movie Theaters Will Always “Have A Role In Society”, But Streaming “Horse Left The Barn”
AT&T CEO John Stankey made his first comments on the WarnerMedia/HBO Max streaming bombshell as the shockwaves continued Friday.
The move to put the studio’s entire 2021 slate on HBO Max at the same time as theaters is “an appropriate decision for the moment we’re in,” Stankey said in an interview streamed on the Washington Post website. “Hey, we have a bunch of movies that are ready to go, and they’ve been sitting on the shelf.” (Check out the full interview with the Post‘s David Ignatius above, with WarnerMedia comments starting at the 43:30 mark.)
After testing “a couple of different concepts,” including an ultimately star-crossed theatrical run for Tenet, as well as studying the moves of rival companies, the team at WarnerMedia decided to pull the trigger. Ultimately, Stankey said, executives didn’t believe that “just pushing them until people feel safe going back to theaters was the right answer.”
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In part, the move could throw a “lifeline” to movie theaters, he said. But it also was an effort to head off what he called a welter of top-shelf releases jockeying for big screens once vaccines roll out and theaters emerge from shutdowns.
“When we think about the dynamic that’s happening with everybody who’s making good theatrical content right now, it’s kind of creating this big bubble,” Stankey said. “Once we see that the consumer is ready to come back into a theater, if all of a sudden everybody releases their inventory, then that’s not going to be a good thing either because there’s only a certain amount of theatergoing that the population is going to do at any one time.”
Mainly, though, the company’s conviction was that “we’re going to have some really good content here that’s spoiling and can be used for other purposes,” Stankey said.
“Our data would suggest that large numbers of customers are not going to feel comfortable, even if they’re movie lovers, doing that at any time in the middle part of” 2021, he said. “We’re going to be well into the late part of next year before we see infection rates and the population as a whole gaining the confidence to be out more dynamically in society and return to doing things like going to a theater to sit down for a two-hour movie. So we just think this is appropriate for this moment in time and this circumstance and we’re lucky as a business to have invested in a streaming platform where we can have the option of doing both and letting consumers choose.”
Despite the hit to exhibition stocks, Stankey said WarnerMedia is not abandoning theatrical release patterns, which have proven lucrative for major studios even though their components may be old-school.
“I think movie theaters continue to have a role moving forward in society,” he said. “They’re an experience for the right kind of content that people are going to want to continue to have. But look, storytelling on scripted content is getting better and better and better. The experience of watching that content at home in comfortable surroundings, with large screens, and having the convenience of watching it when you want to watch it is getting better and better. So, there’s no question that we’re going to see consumer behavior shifts and those are going to sustain themselves.
Despite gloomy pronouncements after the news broke, though, “I don’t believe that yesterday was the day that was the end,” Stankey said. “I just think it’s another day in a string of data points that’s heading in particular directions.”
Ignatius asked if the previous business approaches would resume once theaters reopen and the pandemic recedes, or whether customers would expect all new films to stream day-and-date. “In March, we unleashed a new normal in society,” he said. “That horse left the barn. I don’t think any of us are going to change that dynamic.”
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