HomeBusinessNetflix’s New Film Strategy: More About the Audience, Less About Auteurs

Netflix’s New Film Strategy: More About the Audience, Less About Auteurs

Back in, say, 2019, if a filmmaker signed a deal with Netflix, it meant that he or she would be well paid and receive complete creative freedom. Theatrical release? Not so much. Still, the paycheck and the latitude — and the potential to reach the streaming service’s huge subscriber base — helped compensate for the lack of hoopla that comes when a traditional studio opens a film in multiplexes around the world.

But those days are a thing of the past.

Dan Lin arrived as Netflix’s new film chief on April 1, and he has already started making changes. He laid off around 15 people in the creative film executive group, including one vice president and two directors. (Netflix’s entire film department is around 150 people.) He reorganized his film department by genre rather than budget level and has indicated that Netflix is no longer only the home of expensive action flicks featuring big movie stars, like “The Gray Man” with Ryan Gosling and Chris Evans or “Red Notice” with Ryan Reynolds, Gal Gadot and Dwayne Johnson.

Rather, Mr. Lin’s mandate is to improve the quality of the movies and produce a wider spectrum of films — at different budget levels — the better to appeal to the varied interests of Netflix’s 260 million subscribers. He will also be changing the formulas for how talent is paid, meaning no more enormous upfront deals.

In other words, Netflix’s age of austerity is well underway. The company declined to comment for this article.

Now that Netflix has emerged as the dominant streaming platform, it no longer has to pay top dollar to lure auteur filmmakers like Martin Scorsese, Alfonso Cuarón and Bradley Cooper. It also helps that some of the big studios are again allowing their films to be shown on Netflix not long after they appear in theaters, providing more content to attract subscribers. The latest list of the 10 most-watched English-language films on the service featured six produced outside Netflix.

Mr. Lin’s predecessor as Netflix’s film chief, Scott Stuber, took the job in 2017, when the company had no track record as a place for original movies. To succeed, Mr. Stuber, who had once been the vice chairman of production at Universal Pictures, spent lavishly on talent, promising filmmakers near-complete creative freedom and hefty budgets. It worked — to an extent. The directors got to make their passion projects, and their films earned Oscar nominations (though few wins.)

In 2021, the streamer hit its apex of production, declaring that it would release a new movie a week.

Mr. Stuber, an affable friend to talent, pushed to get Netflix to embrace the idea of wide theatrical releases. And it was a big coup when he landed the sequels to the box office hit “Knives Out,” in a $465 million deal, which some thought could nod toward a change in direction. It never came to be.

Under Mr. Lin, who once ran production at Warner Bros. and produced such hits as “Aladdin” for Disney and the “It” and “Lego” movie franchises, the aim is to make Netflix’s movies better, cheaper and less frequent. Mr. Lin, who declined to comment for this article, also wants his team to become more aggressive producers — developing their own material rather than waiting for projects from producers and agents to come to them, according to two people familiar with his thinking, who spoke on the condition of anonymity to discuss internal communications. This approach, the thinking goes, should help them have more say over the quality of the films.

Netflix was reconsidering its pay structure before Mr. Lin’s arrival. Since the company began sharing performance metrics last year, there have been discussions about basing pay for filmmakers and actors on a film’s performance, similar to how the traditional studios reward them when movies perform well at the box office.

Yet a more economical approach to budgets, along with Netflix’s continued aversion to releasing films in theaters, has some producers and agents in Hollywood griping that the streaming service is no longer a top choice when trying to find a distributor for their films.

Several high-profile filmmakers who made movies for Netflix moved on for their next projects. After making “The Irishman” for Netflix, Mr. Scorsese jumped to AppleTV+ for “Killers of the Flower Moon.” Maggie Gyllenhaal is making “The Bride” at Warner Bros. after directing her first film, 2021’s “The Lost Daughter,” for the streamer. And Scott Cooper, who directed “The Pale Blue Eye” for Netflix in 2022, is taking his highly anticipated Bruce Springsteen biopic, starring Jeremy Allen White, to 20th Century Fox. (New films by the Netflix loyalists Guillermo del Toro and Noah Baumbach are both in production for the service.)

Netflix recently declined to bid on the rights to a short story that Millie Bobby Brown, a star of Netflix’s “Stranger Things” and the “Enola Holmes” films, was attached to, two people familiar with the matter said. It is also no longer moving forward with a film by Kathryn Bigelow based on David Koepp’s apocalyptic novel “Aurora”; the director left the project a few months ago.

Edward Berger — who directed “All Quiet on the Western Front,” which won four Oscars, for Netflix — has been complaining that the service is demanding budget cuts on a film he’s trying to put together with Colin Farrell, according to three people with knowledge of the deal, who spoke on the condition of anonymity because of the delicate situation.

A spokesperson for Mr. Berger declined to comment.

Shortly after Mr. Stuber left the company, Bela Bajaria, Netflix’s chief content officer, gathered members of the film staff in a conference room and told them that the quality of their movies needed to improve, according to three people with knowledge of the meeting, who spoke on the condition of anonymity to describe internal communications. She also indicated that if they weren’t comfortable with moving in a different direction, they might want to consider leaving the company.

One thing that does not appear to be changing anytime soon is Netflix’s strategy regarding theatrical release, a bone of contention with some filmmakers and stars — not to mention theater owners.

“The data from the pandemic is clear that movies released only to streaming don’t get the awareness and pop of a movie that was first released theatrically,” said John Fithian, former chairman of the National Association of Theatre Owners and founding partner of the Fithian Group, which advises clients on ways to support the cinema experience. “Almost all of the most-watched movies on streaming services are movies that were first released theatrically.”

Yet many in the creative community are rooting for Mr. Lin. With the business consolidating, they are desperate for Netflix to continue buying movies. The hope is that with a renewed focus, Netflix may greenlight movies that the studios would say no to, and provide a home for more romantic comedies and midbudget character studies in Hollywood’s shifting landscape.

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