Variety; Netflix’s New Film Strategy: Why the Streaming Giant Is Betting on Quality Over Quantity

Story from Variety:

In 2018, “Saturday Night Live” captured the public perception of Netflix as a ceaseless river of content. In a satiric ad, the late-night program hawked the streaming service as an “endless scroll,” promising that “by the time you’ve reached the bottom of our menu, there’s new shows at the top.” And when it came to movies, “SNL” joked that Netflix was so desperate for things to make, it had resorted to shooting the fake films from “Entourage.”

Scott Stuber, the head of Netflix’s film division, is the man responsible for feeding the algorithm, and for much of his six-year run, his mandate was clear: quantity, not quality. In 2020, for instance, Netflix announced it planned to release a new movie every week. It never got around to making “Medellín,” Vincent Chase’s passion project from “Entourage,” but the strain of producing so many films showed. For every Oscar winner like “Roma,” there was an array of forgettable movies, such as “Thunder Force,” a laugh-deprived superhero farce, or “The Last Thing He Wanted,” a dreary Anne Hathaway drama that no one, it seemed, wanted to watch.

“We were growing a new studio. We’d only been doing this for a few years, and we were up against 100-year-old companies,” Stuber says. “So you have to ask yourself, ‘What is your business model?’ And for a while it was just making sure that we had enough. We needed volume.”

Now, Netflix is shifting strategy again and opting to take fewer bets. Instead of making roughly 50 films annually, the goal is to back between 25 and 30. The result of this judiciousness is one of the company’s strongest fall film slates in recent memory, a compelling mixture of broadly appealing comedies, thrillers and sci-fi adventures, along with Oscar contenders from the likes of Bradley Cooper and the Obamas.

When I meet with Stuber in October, it’s the day after Netflix has commandeered Lincoln Center’s David Geffen Hall for the lavish premiere of “Maestro,” a look at the tangled relationship between Leonard Bernstein and his wife, Felicia, that’s expected to be a major awards player. The film has earned rapturous reviews. Stuber is thrilled by the critical reception and happy that Cooper, who produced, wrote and directed the film in addition to starring in it, received a waiver from the striking actors union to attend the screening. “Maestro,” the Netflix film chief argues, embodies the company’s new approach.

“Right now, we’re not trying to hit a set number of film releases. It’s about ‘Let’s make what we believe in,’” Stuber says. “And let’s actually put forth a slate that we can stand behind and say, ‘This is the best version of a romantic comedy. This is the best version of a thriller. This is the best version of a drama.’”

This fall, Netflix has already fielded “Fair Play,” a provocative look at sexual politics that it acquired out of the Sundance Film Festival for $20 million, as well as “Pain Hustlers,” a dark comedy with Emily Blunt and Chris Evans playing amoral pharmaceutical reps. November sees the debut of “The Killer,” David Fincher’s most crowd-pleasing revenge thriller in years. And many of the streamer’s splashiest releases are still rolling out. They include “Nyad,” a biopic about long-distance swimmer Diana Nyad starring Annette Bening and Jodie Foster; “May December,” a campy drama about the aftershocks of a tabloid scandal that stars Natalie Portman and Julianne Moore; and “Rustin,” the story of Civil Rights activist Bayard Rustin that arrives courtesy of Barack and Michelle Obama’s production company, Higher Ground. “This is what we’ve been building towards,” Stuber says.

Almost as notable are the projects that Netflix has passed on or jettisoned. In recent months, the streamer put “Masters of the Universe,” an adaptation of the popular children’s toy line, into turnaround. (It had once viewed it as a possible franchise.) It also opted not to make a new rom-com from “It’s Complicated” director Nancy Meyers when the budget hit a reported $130 million. Netflix also let competitors snag big packages like Matthew Vaughn’s action-adventure “Argylle” and Jason Blum’s reboot of “The Exorcist.” The company, it seems, is being more prudent about the bidding wars it chooses to enter.

"The market got really frothy, and we were part of that,” Stuber says. “There were a lot of big star-packaged movies out there, and since we didn’t have anything in development or IP, we tried to get them aggressively. We were vulnerable to the marketplace.”

When Stuber took over Netflix’s film operations, he needed to move quickly. He had to figure out how to compete with studios that had vast libraries of movies they could reboot or remake, as well as franchises that had been nurtured over decades. That forced the company to get creative. This winter, for instance, Netflix will debut “Rebel Moon,” its two-part, PG-13-rated, $166 million galactic adventure that it hopes will be its answer to the “Star Wars” films. The service will then release R-rated extended cuts of both movies, most likely in late 2024.'

“It’s the kind of thing you wouldn’t get from a normal studio,” says Zack Snyder, director and co-writer of the films. “It’s almost a ‘Lord of the Rings’-like investment in the potential for this to be a universe. They have a tradition of taking these crazy bets.”

And that willingness to take risks has allowed the company to forge strong creative relationships with the likes of Snyder, Fincher and the Obamas, all of whom have production deals with Netflix. Fincher, for instance, says the streaming service’s openness to the kind of original storytelling that might scare other studios is a big part of the reason he’s made Netflix his home.

“Most studios operate within a checks-and-balances system devised to most efficiently deliver the message ‘No, thank you,’” says Fincher, who also produced and directed one of Netflix’s first original series, “House of Cards.” “It’s all about finding the things that are scary or unique about your project, then distilling them into a balsamic reduction of justification for when they pass on your movie. With Netflix, it’s so much nicer, because when you pitch someone, the response is ‘Wow, that’s a fucking interesting and weird idea. Let’s price it out and see how it might work.’”

Stuber has helped foster the atmosphere that Fincher finds so attractive. A producer of movies like “Ted” and “Identity Thief,” as well as a former top executive at Universal, he was tapped by Netflix to oversee its movies division in 2017 because of his connections to the creative community. His task was to assuage filmmakers’ fears that their work would disappear into a streaming void by emphasizing the marketing and promotional heft that Netflix offered. Those who work with him say that Stuber is a straight shooter who is candid about his concerns about a project. But he also gives artists the space they need.

“Scott understands filmmakers and the filmmaking process,” says Ram Bergman, a producer who has worked with the streamer on “Glass Onion: A Knives Out Mystery” and “Fair Play.” “This is a relationship business. And people want to work with someone who treats them well and gives them respect.”

Even with the A-list talent that Stuber and his team have assembled, some analysts question if Netflix is capable of producing movies that really tap into the zeitgeist. Even when films like the Ryan Gosling-Chris Evans action flick “The Gray Man” or the Chris Hemsworth adventure “Extraction” command a vast audience on the service, they leave little discernible cultural imprint.

“You haven’t had a ‘Barbie’-like event on streaming,” says Rich Greenfield, an analyst with LightShed Partners. “And Netflix hasn’t achieved the kind of cultural moments in film that they have on television with things like ‘Squid Game’ or ‘Stranger Things.’”

But, Greenfield notes, it’s not as if Amazon Prime Video or Apple TV+ has succeeded where Netflix has failed. Even theatrical releases struggle to achieve a cultural ubiquity. “Maybe the question isn’t why hasn’t Netflix had more success in the movie business,” Greenfield says. “Maybe it’s just that movies are playing second fiddle to TV.”

Part of the reason that Netflix has been able to become more selective is that its rivals’ business models are being upended as Wall Street sours on the economics of streaming. Three years ago, nearly all of the major media companies decided that they wanted to launch in-house challengers to Netflix. So in short order, Disney+, Paramount+, HBO Max and Peacock entered the fray. To lure customers, many of these companies stopped licensing the movies and shows they produced to other networks and streaming services; they wanted to exclusively air the programming they had made, even if it meant forgoing a consistent revenue stream. When Stuber took over Netflix’s movies division, he knew he had to act fast.

“It was clear that these companies were about to take back their own movies and keep them in their own ecosystems,” he remembers. “So we had to go all over the world buying as much as we could to make sure that we had the volume our consumers were used to seeing.”

Yet the process of debuting and promoting these services was enormously expensive for companies like Disney and Warner Bros. Discovery, and the costs piled up as the media conglomerates labored under a lot of debt. That worried investors. So in yet another strategic pivot, the companies have once again decided to make their movies and shows available to Netflix and other streamers. That means subscribers can now find HBO’s “Six Feet Under” or Universal and Illumination’s “Minions” on their Netflix scroll.

Often those licensed movies are more popular than the films Netflix makes. Does that bother Stuber? “No, because it means there’s a consistency of movies to watch,” he says. Plus, he notes, sometimes a film he produced in another life will top the most-watched charts that Netflix displays on its homepage. “‘Couples Retreat,’ my old movie with Vince Vaughn, was way up there a couple weeks ago. So I got to brag about that for a minute.”

As the strikes wore on, Netflix was a much more active buyer of movies that debuted at film festivals like Toronto, snapping up Anna Kendrick’s feature directing debut, “Woman of the Hour,” and “Hit Man,” an action comedy from Richard Linklater. It plans to release most of its acquisitions in 2024. Though Stuber is enthusiastic about these films, they also satisfy a pressing need. “Like every other studio, we’re struggling with a work stoppage, and we need to fill some space up,” he says.

Now that the writers union has resolved its contract dispute and the actors union is negotiating its own deal, Stuber is hopeful about going into production on several major movies. He’s tapped Greta Gerwig to adapt the Narnia books into a film series, landed Adam McKay’s serial-killer comedy, “Average Height, Average Build” and will make Noah Baumbach’s latest feature, which he describes as a funny and emotional coming-of-age story about adults. He’s talking to director Rian Johnson about another sequel to “Knives Out.”

“I’m excited about our next wave of things,” Stuber says. “Many of these projects show that we can be a space for big, broad pieces of entertainment.”

But when Netflix swings back into production, it will have to grapple with changes to the streaming economy. Hoping to get more attention for their movies, some streaming services are giving their bigger titles long theatrical runs before debuting them on their platforms. Apple, for instance, is showing Martin Scorsese’s “Killers of the Flower Moon” in 10,000 theaters globally, while Amazon kept Ben Affleck’s “Air” in thousands of cinemas before moving it to Prime Video. Netflix gives a few of its movies exclusive theatrical releases that can last as long as five weeks, but it only shows them on a few hundred screens. Stuber says that’s an important way to “raise a film’s profile,” but he doesn’t expect to follow Apple and Amazon’s lead. Attracting subscribers to Netflix, not selling movie tickets, remains the company’s core business.

And even though Netflix has been busy changing the way that movies are produced and released, Stuber thinks the company can learn from the less harried approach favored by traditional studios. Speed isn’t everything, he argues.

“We’re a machine that was built to go, go, go,” Stuber says. “And that doesn’t always result in quality. A lot of streaming companies made the mistake of moving so fast that we made a lot of things that weren’t ready to be produced. I want to avoid that.”