You could almost hear the sigh of relief heaved in the corridors of Hollywood's big studios when this year's Academy Awards concluded with a Best Picture Oscar for the Peter Farrelly-directed drama Green Book.
The film industry has been under intense scrutiny and considerable pressure in recent weeks. The threat that Netflix poses to it has loomed large throughout the awards season, as Roma – a Mexican drama, directed by Alfonso Cuaron and distributed by the streaming service – collected accolade after accolade. A victory by a film produced outside of the mainstream studio system at its global showpiece would have given traditional movie executives nowhere to hide.
In years to come, however, Green Book's victory will probably be seen as a hollow one. The truth is that the war is already lost. Consumer habits have changed, spurred by, and, in turn, driving technological development. People just don't watch movies in the same way they did before. Cinema has survived and will always exist – just like vinyl records and books it offers a unique experience that cannot be achieved on a mobile phone or via a computer. These days, though, it is not the only way to see the latest films. It's an immersive and luxurious treat. As such, it is becoming more expensive, which helps to explain why US box office receipts remain buoyant, at more than $11 billion last year.
As regards the specific threat posed by Netflix and other streaming services, it's safe to assume that Hollywood believes it has weathered similar storms. It survived and thrived after televisions became ubiquitous in the 1950s. In subsequent decades with the introduction of VHS, DVDs and, more recently, cinematic TV dramas such as Game of Thrones, the US film industry has steadily increased its revenues, earning a total of $43bn in 2017. In the same period, Netflix made $11.7bn in revenues. Netflix, however, is punching Hollywood where it hurts the most, with the creation of innovative original content. It is also doing it in multiple languages. Roma is not a one-off.
What Hollywood executives are failing to see is that the disruptive effects of streaming services are not responsible for the problems of the movie business. Disruption doesn’t happen overnight. The first wave of industries to be shaken up – music, newspapers, travel – were ripe for it long before the advent of Web 2.0. Happy with long-established business models and convinced that nothing would ever change, market leaders were complacent and couldn’t see how weak they had become.
Similarly, Hollywood has had years to change, but it has chosen to double down on the way it has always worked. It could have opened up and embraced technology earlier, rather than fighting against the tide later. Now it is too late. The internet is mobile and connection speeds are getting faster and more reliable by the day. Why should anyone wait until their next trip to the cinema to see the latest blockbuster, or, worse still, until it is out on DVD?
The habits of viewers have also evolved. Young people do not consume media in the same way that their parents – or even older siblings – did. This is already worrying businesses that are still going strong. The English Premier League, for example, is a product that large sections of the public may not even want in 10 years’ time. Sitting for 90 minutes to watch a single game of football is already feeling like an antiquated activity, when you can catch the best of it via clips published on social media. The chase for lucrative TV revenues has meant that for years the experience of watching the sport in a stadium has taken a back seat. Pursuing larger television audiences became everything. But what happens when they are off doing something else? Football will have its own reckoning, and probably sooner than it thinks.
Meanwhile, those responsible for running disruptive streaming services are not sitting still. As Reed Hastings, the co-founder and chief executive of Netflix, said last month, the company’s business model is about winning viewing time away from other platforms – in cinemas, on TV and online. To do this, it knows that it must put the audience first, providing “a better experience, no advertising, on-demand, incredible content”.
Meanwhile, at the 91st Oscars ceremony, Hollywood plays a lonely and largely symbolic defensive hand. I wonder if anyone will still be watching the Academy Awards when they turn 100.
Mustafa Alrawi is an assistant editor at The National
