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IMAX Backs Away From Netflix’s ‘Crouching Tiger’ Sequel (Exclusive)

The streaming giant will handle the Feb. 26 domestic opening of ”Sword of Destiny“

IMAX has stepped back from the controversial Feb. 26 theatrical release of Netflix’s “Crouching Tiger, Hidden Dragon: Sword of Destiny,” individuals with knowledge of the situation told TheWrap.

IMAX now plans to play in around 12 locations, significantly fewer than expected, as the online streaming service offers the film simultaneously for its subscribers. The superhero smash “Deadpool” will continue playing in the remaining 330 or so IMAX sites in North America.

The Weinstein Company, which produced Woo-Ping Yuen’s $50 million martial arts epic for Netflix and announced the release with much fanfare in September 2014, never planned to handle theatrical distribution in North America outside of the IMAX bookings, a TWC spokesperson said. However, TWC will handle the film’s release in China with the China Film Group.

Netflix did not return calls for comment. IMAX declined to comment on Thursday.

Both TWC and IMAX drew heavy fire from the exhibition industry after jointly announcing with Netflix in 2013 plans to produce and release the sequel to Ang Lee‘s Oscar-winning 2000 film, which remains the highest-grossing foreign film ever at the U.S. box office with $128 million.

The rollout called for a simultaneously release of the film, led by returning star Michelle Yeoh, in North American theaters and on Netflix’s online streaming service. Announced in September 2014, at the same time as Netflix’s four-movie deal with Adam Sandler was announced.

The release was initially set for last Aug. 28, when IMAX was planning a broader rollout of the film, but was pushed back to this year.

But Netflix’s day-and-date release scheme for “Sword of Destiny” was a red flag for movie theater owners, who saw it as an encroachment on their exclusive theatrical “window.” The four largest chains, AMC, Regal, Cinemark and Carmike, said that in protest they would not play the new “Crouching Tiger” in their theaters.

The shortening periods between the theaters exclusive runs and movies’ availability for streaming or download digital versions is a major issue for theater owners. Theater chains were behind similar boycotts of last year’s “Beasts of No Nation,” which at the time of its October release was considered a potential Oscar Best Picture contender, and “Paranormal Activity: Ghost Dimension” after Paramount Pictures cut a deal with Cineplex and AMC for an early video-on-demand release.

For the record: A previous version of this story stated that The Weinstein Company backed away from handling domestic theatrical distribution on “Crouching Tiger, Hidden Dragon: Sword of Destiny”; in fact, TWC produced the film but only had theatrical distribution rights in China.

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