How Netflix’s Deals for Foreign Movie Rights Are Changing the Global Film Business

Belgica Day One Film Sundance 2016
Courtesy of Sundance Film Festival

The impact of Netflix and Amazon on overseas business was a hot issue at Berlin Film Festival’s European Film Market. As Netflix rolls out globally, the streaming service has begun to cherry-pick most global rights on a growing number of foreign-language movies, a strategy that’s causing repercussions across the international film biz. Some of the titles already have opened in their home countries, and will now stream in other territories instead of opening in arthouses. Other films, such as India’s Sundance hit “Brahman Naman,” are premiering exclusively on Netflix.

Around the world, as in the U.S., the arthouse business is shrinking, and younger audiences prefer to stream all but event movies, making streaming a welcome platform for creatives. “A Netflix deal is very appealing for smaller or left-field films that may not get much traction in theaters,” said a French studio exec.

Creatives don’t seem worried that potential filmgoers won’t be exposed to traditional movie marketing and advertising.

“Netflix’s (recommendation) algorithms are the best way to discover new films from around the world,” said Nicolas Lopez, whose “No Filter,” a Chilean box office hit, was bought by Netflix.

One big question is how aggressively Netflix will move to acquire projects earlier in the process. “At the moment (Netflix) only buys finished product,” said Italian distributor Valerio De Paolis. “If it started pre-buying movies at script stage as well, it has the muscle to blow me out of the water.”

At Denmark’s TrustNordisk, sales agent Rikke Ennis think Netflix will start to move to secure early rights directly over the next three to five years. “In principle, a producer could go straight to Netflix: It’s increasingly crucial to board the right projects as early as possible,” Ennis said.

The reaction to Netflix’s quick international penetration varies by country as well as by age. The films it has recently acquired have been by directors 40 and under, such as David Wnendt, whose German comedy smash “Look Who’s Back” was picked up by the service for numerous territories outside of Germany.

Wnendt appreciates Netflix’s reach but will miss getting feedback from global audiences. Felix van Groeningen, Sundance world director award winner for “Belgica,” set against Belgium’s nightlife scene, shares Wnendt’s feeling. “I’ve seen a lot of movies not in a theater,” he said. “Is it ideal? No. Do more people get to see a film? Yes.”

Netflix pays filmmakers more than they would probably get by selling a project territory by territory. In France, however, it’s more important to see a film up on the big screen. “Directors and producers are not willing to have their movies skip theatrical and premiere on Netflix even if it gives them worldwide distribution,” said a Gallic exec.

Not all films bought by streaming
outlets will skip movie houses; Amazon, for instance, plans theatrical windows that could be as long as 90 days for U.S. buys.

“Audiences want to see content in different ways,” said Clare Binns at U.K. theatrical distributor/exhibitor Picturehouse. “It’s not one size fits all.”

But the seismic shock of the streaming surge should not be underestimated. While most filmmakers welcome the new buyers, distributors and sales agents are scrambling to board projects earlier or move into production to adapt to the latest wrinkle in the business.

Leo Barraclough, Nick Vivarelli and Patrick Frater contributed to this report.