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Tenet will absolutely not be a streaming-first title, AT&T CEO says

But things in the industry are changing

As film studio executives struggle to determine what movies should be held for a theatrical release and what titles can become streaming exclusives, AT&T CEO John Stankey reaffirmed that Tenet will absolutely go to theaters.

Stankey was asked about the growing industry trend of taking certain movies originally scheduled for a theatrical release and making them streaming-only titles. Warner Bros., which is owned by AT&T, moved its animated Scooby Doo movie to an on-demand rental title before it landed on WarnerMedia’s streaming service HBO Max. Comcast’s NBCUniversal made Trolls World Tour to a digital-only title, and Disney has sent three movies, including Hamilton, straight to Disney Plus.

Warner Bros. blockbusters like Wonder Woman 1984 are unlikely to go streaming first, but Tenet, Christopher Nolan’s movie that’s been delayed to an unknown date later in the year, will definitely be a theatrical release.

“Do I think there can be some things that we built for theatrical release that migrates into a [streaming] construct? Sure,” Stankey said. “Is It going to happen on a movie like Tenet or Wonder Woman 1984? I would be very surprised... actually, I can assure you on Tenet that’s not going to be the case.”

Tenet is a movie that was “engineered” for theaters, Stankey said in an interview with CNBC. Since it “needs to show up that way,” Warner Bros. isn’t looking to turn it into a premium video-on-demand or HBO Max exclusive. Especially considering that Tenet in a pre-coronavirus world would likely do well at the global box office. Dunkirk and Interstellar grossed $527 and $677 million at the box office, respectively. Then there’s also Nolan’s desire to seemingly have Tenet be the movie that reopens theaters, by which the studio is trying to abide.

“Certainly, Christopher would like it to be validated,” Stankey said. “That’s how he wants that piece of work that he’s done to be seen by movie goers, and that’s why it’s going to be something that shows up in a theater.”

While the AT&T CEO reaffirmed Warner Bros.’ commitment to exhibitors, stating that the theatrical experience “still has an important role moving forward,” he also acknowledged the industry is changing. More studios now have streaming services they can feed movies to, and with so much uncertainty surrounding the theatrical industry, studios are leaning on those streaming platforms more. The coronavirus pandemic simply accelerated trends the industry was already seeing. As such, Stankey recognized that changes were going to happen because of the pandemic, adding that he would be surprised “if the industry as a whole didn’t see some adjustment to the theatrical construct.”

“There’s no question that the longer this goes on there’s going to be some content that would be better served in a different construct,” Stankey said, pointing to streaming and digital releases. “I love that we have that option now.”

A big part of the ongoing issue is that no one knows when theaters are going to reopen. AMC Theaters announced today that it would push back it’s opening to mid-August — around the time that Disney’s Mulan and The Last Mutants are slated to be released. Disney could change those release dates, however, and if coronavirus cases in big metropolitan areas continue to grow, AMC could delay its opening again. If an area like Los Angeles isn’t allowing theaters to reopen, Warner Bros. won’t just release Tenet state by state, Stankey told CNBC after the call.

It makes sense for AT&T. Movies that WarnerMedia can find other distribution paths for will continue to move to streaming platforms; this helps bolster HBO Max’s subscriber base. Through digital rentals and HBO Max, WarnerMedia has a platform it can leverage in the pandemic and beyond. Streaming is here — it’s a viable revenue source for studios and the conglomerates that own them. Not taking advantage of those distribution methods doesn’t make sense, but as long as there’s a theatrical business, Warner Bros. isn’t walking away from it.