Netflix is mulling over paying some form of bonuses to filmmakers whose movies perform well on the streaming platform or nab prestigious awards, according to a report from Bloomberg. The tactic would be a way to win over on-the-fence directors and producers who might be shopping a project around at multiple streaming services, while also entertaining the idea of a traditional theatrical release.
According to Bloomberg, the bonus idea is still being debated internally, but it could be a costly change in strategy for Netflix. The company has traditionally covered the cost of production and paid fixed premiums to filmmakers and producers on top of that.
Hollywood operates differently. Studios tend to grant talent — typically directors and producers, but sometimes also high-profile actors (like Dwayne “The Rock” Johnson) — a percentage of box office sales in addition to salaries and other incentives. But Netflix, which is only gradually beginning to screen its films in theaters, and typically only does so to court awards or meet film festival requirements, would have to come up with unique benchmarks for rewarding filmmakers.
Netflix’s television division doesn’t have to compete as much with that medium’s traditional ad-based distribution models, the WSJ points out, because the large checks it cuts for TV talent and production are competitive with or superior to the incentives offered by cable and network channels.
Even if the bonus scheme never fully materializes, it’s more evidence of Netflix’s ongoing struggles to establish itself within the traditional film world, even as it dominates the TV market. While Netflix won three Oscars in February for Alfonso Cuarón’s Roma, the company has irked the traditional Hollywood establishment and festival circuit by refusing to widely screen its original films in theaters, or by demanding day-and-date releases, meaning a streaming and theatrical release simultaneously. Yet Netflix is also hungry for official recognition in the form of prestige pictures and the accompanying awards, which has required winning over directors, actors, and screenwriters more inclined to go the traditional route.
The ongoing tension resulted in Netflix pulling out of the Cannes Film Festival last year over ongoing eligibility disputes. It’s also sparked a number of controversial public feuds with studios, theater chains, and directors, particularly Steven Spielberg, who earlier this year floated the idea that the Academy of Motion Picture Arts and Sciences should change its eligibility requirements to exclude streaming services.
The Academy decided against that, although Netflix has since shifted its ambitions by planning to release Martin Scorsese’s The Irishman and other original films in theaters this fall before making them available on its own platform. That helps Netflix satisfy award eligibility requirements while appeasing theater chains and directors that see at-home streaming of prestige films as a serious existential threat to the Hollywood business model.
Whether Netflix goes a step further and decides to court filmmakers with even larger sums of money may depend on who the streaming service is trying to convince, and whether its recent financial woes may render such an approach too risky.