Netflix co-CEO Ted Sarandos is leaning harder into his promises to not dismantle Warner Bros.’ theatrical model should the streamer acquire the legacy studio, vowing to not just keep a 45-day theatrical window for Warner’s films but to also maintain a premium video on-demand window afterwards.
On the latest episode of “The Town With Matthew Belloni,” Sarandos was pressed on specifics for what kind of theatrical window Netflix would commit to with Warner Bros. films like DC’s sequels to “Superman” and “The Batman” that are on its 2027 slate.
Sarandos, promising no “coded talk,” said that after Warner’s films were in theaters for 45 days, they would not go directly to streaming on HBO Max but instead to premium video on-demand (PVOD) before going to streaming.
“The core thing is that it will feel traditional in how long it is in theaters and how long it takes to get to HBO Max,” Sarandos said.
Other studios that have shorter theatrical windows, such as Universal, have taken a similar approach, arguing that the customer base for PVOD is different than for theatrical or streaming. By placing family films on PVOD, for example, before placing them on streaming, studios can appeal to cost-conscious families who want to see new films but can’t afford to pay for four movie tickets plus concessions while still making more concrete revenue from a single film compared to streaming, where its availability is part of a monthly subscription price and its profit is more abstract.
Theaters have long argued that longer windows mean more profits for both themselves and for studios, as training audiences to assume that movies in theaters will be available on streaming less than two months later will make them less likely to buy tickets or buy or rent them on home platforms.
While Sarandos has said in the past that he believes that theatrical windows as they currently stand are not friendly to consumers, he has pivoted in multiple interviews and in testimony to the Senate Judiciary Committee, saying that Netflix would not get the full value out of its nearly $83 billion proposed deal to buy Warner Bros. if it does not sustain the theatrical infrastructure it would inherit.
“We’re buying a business model and we’re going to invest in it and grow it, not kill it,” Sarandos said.
Sarandos’ comments come as Warner Bros. has reopened negotiations with Netflix’s main acquisition rival, Paramount Skydance, which has been given a seven-day window to present a new offer to buy the company.
“During this period, WBD will engage with PSKY to discuss the deficiencies that remain unresolved and clarify certain terms of PSKY’s proposed merger agreement,” Warner Bros. said in a release on Tuesday.
Sarandos told CNBC that Netflix granted Warner a waiver to reopen those talks with Paramount, saying the company was okay to “let them make a move.”
“Paramount had been making a ton of noise, flooding the zone with confusion for shareholders … including floating all these hypothetical offers and talking directly to the shareholders and bypassing the Warner Bros. Discovery board,” Sarandos said. “So we’ve given the opportunity to get those shareholders exactly what they deserve, which is complete clarity and certainty.”
Watch Sarandos’ comments on windowing, as well as on claims that his commitments are not long term, in the clip above.
