In a long analysis of the cable television business yesterday over at Huffington Post, Tom Silva argued “Movies fared quite poorly during the economically shaky year of 2011. Last year was the weakest year in terms of movie tickets since 1995, with overall revenues dropping by 4.5% compared to 2010–despite the fact that prices were at their highest ever. So, what happened? It could be that, just as Hollywood had to fend off television in the 1940s and 50s, Hollywood is facing a new assault — but this time from Pay-TV. There is a serious case to be made that the center of the media constellation has shifted to Cable TV.” I think there’s definitely truth to the idea that richer storytelling is taking place in serialized form on television than it is in many two-hour chunks of the movies. But the relationship between television and movies is even more complex than that. Cable television is starting to make truly excellent movies that movie studios probably wouldn’t produce. And while they have very different core business models, FX, Netflix, and HBO are suddenly in collective competition for at-home viewers rental dollars, whether they come in the form of a cable package or a Netflix subscription.
In an interview with Deadline, Tony Gilroy, of Bourne and Michael Clayton fame, astutely noted that mid-budget action movies are essentially non-existent these days. “It doesn’t seem that long ago that I finished Michael Clayton and in my fantasy, my life would be, I’ll write for dough and I’ll try to make Crimes And Misdemeanors every year-and-a-half or two years. Well, that model just doesn’t work. That disappeared by the time I woke up, you know, from Duplicity. It’s over,” he said. “There will be exceptions. I don’t want to be Chicken Little or anything, I think stuff like that will exist and I don’t think that’s any big secret to anyone that it’s all gone and it’s gone to some place really great – it’s gone to cable television. As upsetting as it is to watch the movie part of it disappear, it’s pretty exciting you realize that television is better than anything’s ever been in the history of entertainment probably.”
He may have been referring to the tone and grown-up (as opposed to adult) orientation of content. But it’s also true that TV is making a lot of terrific and ambitious movies right now. HBO’s adaptation of Andrew Ross Sorkin’s financial market meltdown Too Big to Fail boasted a fantastic cast and snappy writing. It easily could have gotten the theatrical release and video on demand deal that Margin Call received, and HBO could have just as easily bought Margin Call for a premiere airing and on-demand screenings. Even if I thought it was laughably bad, Hemingway & Gellhorn was visually experimental, the kind of television movie that only works because relatively inexpensive large flat-screens have become so ubiquitous (the same reason, I think, Breaking Bad has been able to be so visually ambitious).
And even when cable channels aren’t making their own movies, they’re aggressively acquiring them for secondary distribution. HBO’s been able to resist putting its contents streaming on Netflix not only because the value of its original scripted series is so high that people will buy them stand-alone, but because it has a considerable movie library to both stream and air. FX has also been aggressively acquiring top-grossing movies—network president John Landgraf said at the Television Critics Association press tour that FX had purchased rights to 20 of the 30 movies that made more than $100 million in 2011—in part as a way to push back at Netflix, which has previously suggested that FX doesn’t have the capacity to build its own streaming site like HBO GO or Netflix. If FX can put the squeeze on Netflix by snapping up desirable movies, it can negotiate more favorable deals for content like Sons of Anarchy.
And Landgraf is pushing critics to demand specific numbers that would place a value on Netflix’s content, particularly as that company starts production on new episodes of Arrested Development and continues work on its House of Cards remake.
“Netflix could tell you how many people watched Lilyhammer — each episode of Lilyhammer if they wanted to,” he pointed out at TCA. “And what I’m saying to you is, look, to say that 20 million unique users sampled something tells me nothing. They might have watched 30 seconds of it. You understand? That’s 30 20 million people spent, an undefined amount of time interacting with a piece of programming, whereas, if I tell you that 3 million people a week or 8 million people a week in a certain demo or total viewers watched a show, that means that’s the average viewership for every minute of that show.” If Netflix’s prices are to rise, and they may have to in order to let the company keep up in the content and development arms race, cable companies are going to want to make the case that consumers get a better value for their money from the cable bundle and premium channels than from Netflix or Hulu Plus.
In other words, the idea that the future of cable and the future of the movies trade off with each other isn’t quite right: instead, they, and the future of streaming video services, are merging into a continuous ecosystem. The movies will still be able to make huge up-front investments that a network like HBO is spreading over seasons and years with something like Game of Thrones, and roll the dice on tiny movies that could be hits or busts, but that won’t garner the basic audience cable needs to sell subscriptions and advertising. Television will still dominate truly long-term storytelling, no matter how many movies Peter Jackson turns The Hobbit into. And as television you watch on a television set becomes only one element of the cable business model, the long-term monetization of movies will be a place where cable networks and movie studios interests—and ours—intersect.
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