Netflix vs. Theaters: How Netflix Wins Directors
# Netflix’s Film Strategy: How Big Spending and Creative Freedom Are Winning Hollywood Over
Netflix has quietly become a major force in the film industry, attracting top talent and producing critically acclaimed movies. Its strategy of offering meaningful financial resources and creative freedom is proving irresistible to directors, writers, and producers who might otherwise struggle to get their projects made.
## Netflix’s Rise as a Film Powerhouse
netflix’s success in film is undeniable. “The Mother,” starring Jennifer Lopez, is the platform’s best-performing film to date with more than 230.9 million views. This impressive viewership is a key factor in Netflix’s ability to draw in high-profile creatives.
It’s hard for directors and other creatives to dismiss the kind of viewership Netflix brings, hollywood insiders told CNBC. It’s one of the reasons that Netflix has been able to draw in big-name directors, writers and producers over the last decade.
Netflix has also been more flexible with its purse strings. “The electric State” is just one example. Martin Scorsese’s “The Irishman” also saw studios pass on the film because of its ballooning budget, but Netflix stepped in and acquired the rights. the film went on to garner 10 Oscar nominations, although it ultimately went home empty-handed during the 2020 ceremony.
Al Pacino, Martin scorsese and Robert De Niro attend “The Irishman” International premiere and Closing Gala during the 63rd BFI London Film Festival
Mike Marsland/WireImage
“Netflix, because they have interest in getting awards and nominations and all that stuff, have funded and purchased and been involved with directors who are really high-quality filmmakers worldwide,” said David Poland, a film industry analyst.”It’s a tribute to Netflix that those movies exist.”
The streamer has had at least one best picture contender at the Academy Awards since 2019.## Investing in Talent and Content
The company has not been shy about spending money to secure top talent. It’s signed dozens of lucrative first-look deals with creators, which give it the exclusive right to review and possibly purchase or distribute a new project before it is indeed offered to other buyers. past deals have run the gamut between television and film and included creators like Tyler Perry,Antoine Fuqua,Shonda Rhimes and Jennifer Lopez.
netflix has even been more targeted in its contracts, as was seen when it penned a two-picture deal with Dwayne Johnson for sequels to his 2019 film “Knives Out,” which reportedly was for more than $400 million.
“It would be tough for any creative to turn down the offer of the financial resources to realize their creative vision,” said Paul Dergarabedian, a media analyst. “And despite wanting their movies to be seen on the biggest screen possible, [they] have made the calculus that getting their works realized on film and presented on a major streaming platform is a bargain worth making.”
Wall Street doesn’t seem to mind Netflix’s movie strategy. The company’s stock is valued at nearly $1,300 a share and has soared 45% since January and more than 90% in the past year.Netflix is expected to spend around $18 billion on content this year, according to the company. It does not disclose what percentage of that funding goes to its movies versus its television productions. The company currently projects that its full-year 2025 revenue will be between $43.5 billion and $44.5 billion.
### The Future of Netflix and Pricing
Insiders said that with those kinds of investments,consumers might need to watch out for more price hikes. MoffettNathanson’s Fishman noted that Netflix will continue to weigh its value proposition to determine if it needs to increase the cost of its services.
If Netflix keeps creating content from top-tier creators, then the analyst firm expects prices to increase.*Disclosure: Comcast is the parent company of NBCUniversal and CNBC.*