Demand for First-Run Movies Online On the Rise

New data from Parks Associates indicates that 25 percent of U.S. broadband homes prefer using an OTT service to watch new films, while 24 percent would rather see them in movie theaters first.

“COVID-19 has upended the traditional content-windowing process, and consumer research shows this paradigm shift is impacting consumer attitudes,” said Steve Nason, research director at Parks Associates. “An OTT source scores higher than movie theaters when consumers report their preferences for first-run movies. This shift might be temporary, and nearly 30 percent have no preference for how to watch a new movie, which gives theaters a glimmer of hope they can eventually gain back some audience for first-run titles.”

WarnerMedia has upended the theatrical window, announcing that the entire Warner Bros. 2021 theatrical slate will be released on HBO Max at the same time as they hit theaters. This followed news that Wonder Woman 1984 would arrive on HBO Max on Christmas Day. Disney, meanwhile, has been experimenting with a PVOD release on some titles, beginning with Mulan this year.

Parks also reports that as of May of this year, 8 percent of U.S. broadband homes canceled at least one video service during the pandemic, including 4 percent that axed a traditional pay-TV service, largely due to the absence of sports. More than 40 percent of former pay-TV subscribers said they would re-subscribe once sports resumed, while more than two-thirds of former online pay-TV subscribers would sign back on.

“The lack of sports programming had a significant role in households canceling their pay-TV services early in the pandemic,” said Jennifer Kent, senior director at Parks Associates. “All major leagues have now resumed play, and that should bring back many of these households, especially online pay-TV subscribers, who have an easier path to re-subscribe compared to traditional pay TV. However, the ongoing economic crisis could push additional households to trim services. Service and video providers are shifting to focus on retention and finding ways to keep subscribers through innovative partnerships and unique content.”