Amazon to Start Theatrical Movie Operation, With a Quick Streaming Tie-In

After winning acclaim for one of its original television productions, Amazon announced Monday that it would produce and acquire films for theatrical release and early distribution on its Prime Instant Video service.

Amazon original movies will be available for U.S. streaming four to eight weeks after they make their debut in theaters, a significant reduction of the window of 39 to 52 weeks that films normally play in theaters before becoming available for streaming.

The development is another step in Amazon's ambitious plan to increase its entertainment offering to consumers, and an escalation in Amazon's rivalry with Netflix. It also signals both companies' broader ambitions to revolutionize the so-called windowing system for TV and movies in the traditional entertainment industry.

In the fall, Netflix announced movie deals with comedian Adam Sandler and also said it would release a sequel to the movie "Crouching Tiger, Hidden Dragon" simultaneously across the globe and in a select number of Imax theaters.

Both companies already have shaken up the model for television, making shows available for streaming soon after they are televised on traditional networks and also releasing original series they produce all at once.

Amazon said it was seeking to create 12 movies a year that "focus on unique stories, voices, and characters from top and up-and-coming creators." Production will start later this year.

In an email, Roy Price, vice president of Amazon Studios, described the projects as "indie" movies, with budgets between $5 million (roughly Rs. 30 crores) and $25 million (roughly Rs. 154 crores).

Analysts cautioned that if the films were low-budget and of low quality, it would be difficult for them to profoundly alter the conventional system for theatrical releases.

Still, said Rich Greenfield, a media analyst with BTIG Research, the announcement adds to the pressure on traditional business models and gives consumers more of what they want.

"In 2015, consumers don't understand why there is an exceedingly wide gap between seeing a movie in a theater or seeing a movie at home," he said.

Monday's news comes one week after Amazon's original series "Transparent," a dark comedy about a family in which the father comes out as transgender, won a Golden Globe for television comedy. It was the first time that a streaming service landed a best-series award in the television category at the Globes.

Also last week, Amazon announced that it had reached a deal with filmmaker Woody Allen, in which he would write and direct his first television series. Few details about the production, which is scheduled to make its debut on the service next year, were available.

Price said that the film projects would not go through the same pilot process as its television series, where the company decides whether to go forward with projects partly based on viewer feedback.

"Though a lot of the attention in the industry and press has been focused recently on television series, and it is indeed a new golden era in television, we think the death of film has been greatly exaggerated and films can and will continue to be a vital, brilliant and unique part of culture in America and throughout the world," Price said in the email. "There is still a robust audience, certainly on Amazon, for interesting films."

To lead production in its original movies group, Amazon has hired Ted Hope. Hope previously ran a production company called Good Machine, which produced films such as "Eat Drink Man Woman" and the original "Crouching Tiger, Hidden Dragon."

The impact of streaming on theatrical release is the subject of debate in Hollywood. Last month, when Sony Pictures arranged for digital distribution of its controversial Seth Rogen comedy "The Interview," some commentators predicted that it would upend the traditional distribution model. Others cautioned that it was still an experiment and not necessarily a moneymaking proposition.

"It's such a unique situation," Greenfield said of "The Interview.''

The new venture is not Amazon's first foray into film. In 2010, the giant retailer created a stir in Hollywood with the start of its studio group, which solicited online submissions for full-length movies. Amazon said at the time that it would award a total of $2.7 million to the top submissions and would develop the projects into commercial feature films.

Price said that Amazon did not expect that most of the movies in its original movies group would come through online submissions. He said that the company was developing some movies through online submissions but that they would not fit into the program announced Monday.

Amazon did not respond to questions on whether the company has tried to negotiate deals with any theater chains for shorter theatrical runs.

Netflix faced resistance after announcing its plans for the "Crouching Tiger" sequel, with two major theater chains saying that they would not screen the film.

© 2015 New York Times News Service