Netflix is on a mission to become the king of low and mid-budget films. The streaming giant promised 80 original films in 2018, and now we’re starting to get a better idea of what their slate might entail. If you like $20-80 million action, sci-fi, or horror films, Netflix has a monthly subscription to sell you.
Yesterday, LRM reported that Netflix was seeking to acquire God Particle (aka Cloverfield Station) from Paramount — the third film in the loosely-connected Cloverfield franchise. Paramount also recently sold Netflix Alex Garland’s Annihilation — a mid-budget, sci-fi thriller, based on the best selling novel by Jeff VanderMeer. OK, what’s the connection?
At first glance, these moves by Paramount don’t make much sense. The Cloverfield films have been wildly profitable; the first two iterations had a combined production budget of $40 million, but earned over $280 million worldwide. Garland wrote such sci-fi gems as: 28 Days Later, Dredd, Sunshine, and Ex Machina (the last of which he also directed). Why is Paramount bailing from a successful franchise and running away from a major sci-fi talent like Garland?
It’s another signal that Paramount — and likely all of the major studios not named Disney — are shaving their slates to focus on blockbusters. Paramount views these mid-budget productions as low-risk, moderate reward. Even though these are generally profitable projects, the problem is that they’re not profitable enough. What? That’s right, even though a film like Ex Machina only cost $15 million, it only made $36 million, which barely broke even (after factoring-in marketing costs).
Paramount’s chairman Jim Gianopulos, who rose to power last spring, has apparently been taking a sharp knife to their list of upcoming productions. A source spoke with THR regarding these deals, “[Jim] sat down and looked at what is theatrical, what is not in this day and age.” That’s ominous.
It’s also a subtle way of saying: let’s stop wasting our marketing dollars on break-even projects, and instead focus our efforts on high-risk, high-reward CG-spectacles. Too cynical? Consider Paramount’s 2017 at the box office: Mother!, Monster Trucks, Ghost in the Shell, Baywatch, Downsizing, Suburbicon — all of these movies tanked hard at the box office. Transformers: The Last Knight was their biggest hit (and it was only number 23 at the box office). Whether or not you agree with Mr. Gianopulos, you have to appreciate his situation.
So, where’s this all heading? Paramount and the other majors are all struggling to produce successful big-budget hits while fending off growing threats from the streaming services. Blockbusters cost a ton of money to produce and market — but marketing puts butts into seats. So rather than spreading their cash and resources on dozens of smaller productions with minimal upside, this gives them the ability to funnel more into Transformers, Mission: Impossible, Terminator, and whatever other tentpoles they’re developing.
Ultimately, Paramount, Universal, WB, and Sony are all looking up at Disney and their roster of Marvel-Pixar-Lucasfilm properties (and soon Fox’s franchises too). All of this plays right into Netflix’s hands, who’s seizing the opportunity to pick-up more and more finished (and nearly finished) low and mid-budget films, to satisfy their ravenous subscriber base. This is just the next chapter in the streaming wars, and Netflix is positioning themselves brilliantly.
Do you want to see more or fewer mid-budget films on Netflix? Let us know in the comments down below!
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