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Premium V.O.D. revenue is small compared with box-office sales. But it’s certainly not nothing.
“The Super Mario Bros. Movie” has generated more than $75 million in premium V.O.D. revenue since May 16, Universal said. “Jurassic World: Dominion,” “The Croods: A New Age” and “Sing 2” each collected more than $50 million. Universal said 14 films, including “News of the World,” a period drama starring Tom Hanks, and “M3gan,” each had more than $25 million.
Films from Focus, including “Belfast” and “Mrs. Harris Goes to Paris,” have generated roughly $5 million each. For some art films, a theatrical release has become valuable mostly as “a marketing tool” for premium V.O.D. rentals and purchases, according to Julia Alexander, the director of strategy at Parrot Analytics, a research firm.
Much like DVD sales in the 1990s and 2000s, premium V.O.D. has started to provide a type of financial safety net on box-office misses. “The Focus titles, in particular,” said Peter Levinsohn, the Universal Filmed Entertainment Group’s chief distribution officer. “Those smaller films aimed at older moviegoers have become, I wouldn’t say reliant on it, but they have benefited hugely.”
It’s also about flexibility, Mr. Levinsohn said. The studio often decides that 17 days (three weekends) of theatrical exclusivity is enough. Sometimes, based on ticket sales, it allows for longer. “The Super Mario Bros. Movie” played exclusively in theaters for 41 days.
“We have also taken back control of the decision of when to make our content available in the home, based on the most optimal timing for an individual film,” Mr. Levinsohn said. NBCUniversal said in January that revenue from its studios (both film and TV) increased 23 percent in 2022 from a year earlier, to $11.6 billion.
Every studio has been trying to find creative ways to maximize movie profits in a fast-changing business. Part of Universal’s challenge is guessing what kind of impact premium V.O.D. might have on streaming: If movies are sold or rented more widely before they arrive on a streaming service (in Universal’s case, on Peacock and Netflix), does that make the movies less valuable tools for encouraging people to sign up for streaming services?
“The impact on streaming is not quite as big as people might have expected, but it’s still notable,” Ms. Alexander said.
