TIME movies

Leo DiCaprio Teams With Netflix on Endangered Gorillas Documentary

8th Annual Clinton Global Citizen Awards - Arrivals
Leonardo Dicaprio at the 8th Annual Clinton Global Citizen Awards at Sheraton Times Square on Sept. 21, 2014 in New York. Michael Loccisano—Getty Images

Virunga hits Netflix and select theaters on Nov. 7

Leonardo DiCaprio is coming to Netflix — but not in the way you might expect.

The actor is teaming up with the streaming giant to release Virunga, a documentary directed by Orlando von Einsiedel that takes a look at gorilla preservation in the Democratic Republic of Congo’s Virunga National Park, according to The Hollywood Reporter. The movie follows a team of park rangers, one of whom is a former child soldier, as they try to protect endangered mountain gorillas from poachers.

The movie, executive produced by DiCaprio, will hit Netflix and theaters in Los Angeles and New York City on Nov. 7.

“Leo intuitively understands that there is nothing like the power of film to reach people’s hearts and minds,” Ted Sarandos, Neflix’s chief content officer, said in a statement. “With Virunga, we’ll work with Leo to introduce viewers around the world to an incredible, gripping story that will have audiences guessing right up until the final act.”

[THR]

TIME Companies

Here’s Why Netflix Can Shrug Off its Stock Plunge

US Online Streaming Giant Netflix : Illustration
In this photo illustration the Netflix logo is seen on September 19, 2014 in Paris, France. Netflix September 15 launched service in France, the first of six European countries planned in the coming months. Pascal Le Segretain—Getty Images

Netflix is hanging on tight to its core mission

It’s not every day that a brand-name stock loses a quarter of its value in a matter of minutes, as Netflix did after reporting its financial earnings Wednesday. It’s even rarer when executives respond as if it’s no big thing.

After Wednesday’s stock market close, Netflix reported a net profit that exceeded Wall Street’s expectations. So far so good. But Netflix’s success hinges on whether it can keep signing up new subscribers, and it’s here where the company came up short: The company added 3 million net subscribers around the world after publicly predicting it would add 3.7 million.

Investors read those numbers and started running for the hills. It took about 30 minutes for Netflix’s stock price to fall by more than $120 a share. After the plunge, the company was more philosophical than apologetic. “Our internal forecast . . . will be high some of the time and low other times,” CEO Reed Hastings shrugged in a letter to shareholders. Later, on a Google Hangout with select analysts, he was just as Zen-like, saying he expected to miss subscriber estimates “frequently.”

There are a few reasons why Hastings can get away with this attitude without investors calling for his head. Wednesday’s stock market was a tumultuous one in general, seeing the Dow close down 173 points after a 458-point drop at its worst. And amid lingering concerns that tech valuations in general were too high, many investors were ready to sell any stock on bad news.

On top of that, Netflix has long been a favorite of speculators, who have made it one of the most consistently volatile issues in the tech sector for the past decade. This has long been a headache for Hastings, who’s complained before about “momentum investor-fueled euphoria.” Such euphoria usually ends in nasty hangovers, like the 80% plunge in Netflix’s stock price after it raised prices in 2011. What Netflix is seeing today is another bender coming to an end, one Hastings predicted a year ago.

The main reason Netflix is shrugging off the current decline is that the company has always hewed, come what may, to a single strategy of finding a more efficient way to distribute video content. That tactic, which has always worked out in the long run, is the classic distrupt-the-incumbent model. And in the world of video content, no one has done this better, and more consistently, than Netflix.

The creation myth of Netflix says that Hastings founded the company after racking up $40 in video rental late fees. As DVDs emerged, Hastings started delivering them by mail, precipitating the slow but sure extinction of video-store giants like Blockbuster. As bandwidth improved, Netflix switched to an even more efficient way to deliver movies: by streaming them online. Today, 87% of Netflix revenue comes from streaming movies and TV shows. Netflix has effectively disrupted its own founding business model. Netflix wasted no time disrupting its founding business model, splitting off its DVD-by-mail business into an ill-fated venture called Qwikster. Today, Quikster is an unsightly footnote in the company’s history, and 87% of Netflix revenue comes from streaming movies and TV shows.

More recently, Netflix has begun to bump up against the cable companies that are so loathed by consumers by pushing more into TV programming, notably several of its own series. In a victory for cord-cutters, Time Warner said Wednesday it would offer HBO as a standalone online service starting next year. That will provide Netflix a strong competitor, but it’s likely to do more damage to the cable providers in the long run. In effect, HBO is hedging its future by adapting to the model Netflix pioneered. CBS followed suit Thursday with its own launch of an on-demand subscription service for its programs.

Now Netflix is moving into a new area by producing its own original films, reasoning that it’s often cheaper than entering into bidding wars for titles every several years. This is likely to work with “branded” films, like a sequel to Crouching Tiger Hidden Dragon and a series of Adam Sandler vehicles (Netflix says data shows Sandler’s comedy translates well in global markets like Brazil and Germany — who knew?).
This latest move is angering movie theater chain owners, mostly because their own aged business model has turned into another unpleasant experience for consumers. Moviegoing often involves paying upward of $15 a ticket to endure a gauntlet of pre-film commercials and obscenely overpriced popcorn. Another recent technological development, the rise of affordable, high-def home entertainment systems, is making it easier to bypass that experience. And Netflix is now working to speed up the time it takes for new movies to reach home theaters.

All this is costing Netflix a lot of money. Streaming content obligations rose to $8.9 billion from $7.7 billion in the last three months alone. Netflix is warning that these obligations will weigh down cash flows for years. This is risky, because the new content costs may not translate into enough new subscribers. And that’s why investors freaked out about the low subscriber figures this quarter. Netflix keeps building more content, but what if subscribers don’t come?

Right now, Netflix is shrugging in the face of all this fretting. Investors also worried two years ago, when the company’s overseas operations were losing $400 million a year. This year, Netflix’ international subscriptions are close to breaking even. Most of all, the company has learned to ignore speculators and naysayers as it pursues its core strategy of finding better ways to bring quality video content to consumers. Producing movies may sound like a new and risky area to move into, but as Netflix sees it, it’s the same old business model that’s worked so well in the past.

TIME Earnings

Netflix Had a Pretty Awful Day

Netflix's logo
Netflix

Online streaming service revealed Wednesday it had missed growth targets, as HBO announces a rival streaming-only service

Correction appended Wednesday, Oct. 15

Netflix stock took a nosedive in after-hours trading thanks to a confluence of bad news for the company on Wednesday.

The streaming service missed its subscriber growth forecasts for the quarter and is one of the companies most threatened by HBO’s surprise announcement Wednesday that it will begin offering its content in a stand-alone streaming service in 2015. Netflix shares fell more than 25% in after-hours trading, erasing more than $7 billion in company value.

Netflix added 3.02 million subscribers globally during the third quarter, well off the 3.69 million the company had projected. In the U.S., the company blamed the stalled growth on a $1 price hike that went into effect in May. “Slightly higher prices result in slightly less growth, other things being equal, and this is manifested more clearly in higher adoption markets such as the U.S.,” the company said in a letter to shareholders. Netflix also missed the mark in international markets, though it rolled out in six new European countries in September.

The streaming service’s financial results were more positive. Netflix pulled in $1.4 billion in revenue, meeting analysts’ expectations. Earnings per share were 96 cents, beating projections of 93 cents. Overall Netflix generated $59 million in profit.

But the looming specter of a stand-alone HBO that consumers will be able to buy without subscribing to cable may be a greater threat to Netflix than slowing growth. The company did not seem overly concerned, however, about having to convince customers that House of Cards is more worthy of their money than Game of Thrones.

“The competition will drive us both to be better,” Netflix said in its letter. “It was inevitable and sensible that they would eventually offer their service as a standalone application. Many people will subscribe to both Netflix and HBO since we have different shows, so we think it is likely we both prosper as consumers move to Internet TV.”

Correction: The original version of this story misstated Netflix’s total revenue in the third quarter. It was $1.4 billion.

Read next: HBO Will Finally Start Selling Web-Only Subscriptions Next Year

TIME Media

6 Crucial Unanswered Questions About HBO’s New Streaming Service

Inside A PCCW Ltd. Store As Purchasing Managers Index (PMI) Data Is Released
Bloomberg—Bloomberg via Getty Images

Here's why it's probably best to be cautiously optimistic

After years of maybe’s and not yet’s, HBO has finally announced that it will offer its content as a streaming service independent of a cable subscription sometime in 2015. People who don’t subscribe to cable have been begging HBO to take their money for years. Now, it seems, a rising tide of cord-cutters getting rid of cable and young adults who never subscribed to cable in the first place have compelled the network to fulfill their wishes.

But the announcement was painfully light on details. We don’t even know whether this service will be the same as HBO Go, the robust streaming app the network currently offers to its subscribers. Here are the questions HBO still needs to answer:

How much will it cost?

They don’t call it “premium cable” for nothing. The cost of HBO currently differs based on pay-TV provider and region but generally falls in the range of $15 to $20. Many cable operators offer the service at a discounted price of $10 per month for the first year. High-definition streaming on Netflix, for comparison, costs $8.99 per month. It’s hard to say where exactly an independent HBO would fall on this spectrum. Time Warner, which owns HBO, currently splits subscription fees with cable operators, but the operators handle the billing, customer service, delivery of content and some marketing. With a standalone service, HBO would have to deal with those issues itself and charge a fee appropriate to recoup those costs. Two years ago, HBO tweeted that a TechCrunch story that pegged the amount people would pay for the service at $12 per month “has it right.”

Will I be able to watch the newest episode of Game of Thrones?

If this service is the same as the current streaming service, yes. HBO Go allows customers to live stream the network’s TV shows on their laptops, mobile devices, and televisions. But it’s worth noting that HBO didn’t specifically say that HBO Go will be the standalone offering. The company has been notoriously reticent to offer its newest content to people who don’t pay for cable. Even the monumental deal to bring HBO content to Amazon Prime Instant Video for the first time doesn’t include Game of Thrones or more recent seasons of current shows like Boardwalk Empire.

Will the service perform well, technically?

Going by HBO’s past track record, this could be a problem. HBO Go crashed during the season finale of True Detective and multiple times during the last season of Game of Thrones because too many people were accessing the service simultaneously. Obviously a standalone service would be even more popular. No doubt HBO would beef up its servers to handle additional load, but that added expense would place more pressure on the network to raise the price it charges customers.

Will Internet service providers play nice with an HBO streaming service?

This year has seen an ongoing debate between Netflix and several ISPs over who should pay to deliver Netflix’s content to customers. Netflix suffered slowed speeds on the networks of Comcast and Verizon until the company agreed to pay them to establish a better connection. As a streaming service that will also stream its content over ISP’s pipes, HBO could face similar costs. It doesn’t help that many of the ISPs are also pay-TV operators that aren’t likely to be pleased that HBO is giving customers an incentive to cut the cord.

Can I finally dump my cable company?

If you were only keeping it around for HBO, and the new service functions similarly to HBO Go, sure. Otherwise, you’ll still need cable to watch a lot of TV content live, especially sports. But the fact that a cable network as prestigious as HBO is willing to break out of pay-TV’s walled garden in such a big way could have implications later. Other channels that already have robust streaming apps, such as FX and ESPN, could follow in HBO’s footsteps.

Does this matter to me if I still have cable?

It might. Cable operators initially offer HBO at a discount to entice customers to subscribe to the service. Now that HBO is becoming a competitor as well as a partner, they may be less motivated to subsidize the channel. And with HBO having to take on new infrastructure costs, the network may pass those expenses along to both cable and non-cable subscribers.

TIME Television

Friends Is Headed to Netflix

ANISTON SCHWIMMER
Jennifer Aniston and David Schwimmer appear in the baby birth episode of NBC's hit series "Friends," airing in a one-hour season finale on Thursday, May 16 at 8 p.m., EDT. The episode may well cement "Friends" status as the most popular show on television for the 2001-02 season. (AP Photo/NBC- Warner Bros. Television) Anonymous—ASSOCIATED PRESS

The iconic NBC comedy will be available for streaming on January 1

Continuing a seemingly ceaseless burst of Friends nostalgia that’s been going since the tenth anniversary of the sitcom’s finale, Netflix announced that the entire series’s run will be available for streaming beginning January 1, 2015.

It’s a major deal, given the popularity of the NBC sitcom to this day, not to mention the sheer volume of episodes involved. (Despite the fact that TBS always seems to be airing the same few episodes, there were 236 installments of the show.) Friends is widely available on syndicated television, but given the wide variations in tone season to season, the opportunity to choose whether to watch a low-drama episode where the gang hangs out or one from the height of the Rachel-Ross-Joey love triangle is a significant boon to Friends devotees.

Netflix’s original offerings have tended to prompt so-called binge viewing due to their sheer volume of incident. House of Cards and Orange Is the New Black both rely on cliff-hangers and twisty plots that compel viewers to watch the next episode. But given the excitement around Friends hitting the streaming service, it’s not hard to imagine the exact opposite sort of television being just as binge-able. Friends is at its best when little of consequence is happening, in the long stretches of episodes where they’re all bickering over apartments or cleaning philosophies. It’s extremely comfortable and comforting TV — the sort that will lend itself perfectly to hours of consecutive watching this winter.

Read next: The Best Halloween Movies Streaming Right Now

TIME Technology & Media

HBO Will Finally Start Selling Web-Only Subscriptions Next Year

HBO Chairman and CEO Richard Plepler and HBO Programming President Michael Lombardo speak onstage at the Executive Session panel during the HBO portion of the 2014 Summer Television Critics Association on July 10, 2014 in Beverly Hills.
HBO Chairman and CEO Richard Plepler and HBO Programming President Michael Lombardo speak onstage at the Executive Session panel during the HBO portion of the 2014 Summer Television Critics Association on July 10, 2014 in Beverly Hills. Frederick M. Brown—Getty Images

Viewers won't have to pay for a pricey TV package to watch HBO shows like Game of Thrones and Boardwalk Empire

HBO will begin selling web-only subscriptions in 2015, a major move for the television giant as it seeks to attract a younger generation of consumers more likely to skip paying for cable television in favor of streaming services like Netflix.

HBO CEO Richard Plepler said at a Time Warner investors’ event Wednesday that HBO will launch a “stand alone, over the top” version of its network beginning in 2015 that won’t require a pay TV subscription, Re/code reports. HBO is a subsidiary of Time Warner.

The new offering would likely mean that viewers will be able to watch hit HBO shows like Game of Thrones, The Sopranos, Boardwalk Empire and others without having to pay for a TV service, similar to Netflix’s model for watching shows like Orange is the New Black and House of Cards. However, HBO has so far offered few details about what content will be available on the service. HBO recently put some of its older but well-regarded content, such as The Wire, available to watch on Amazon’s streaming service, Amazon Prime Instant Video.

Time Warner made $4.9 billion in revenue from HBO last year, but it could attract more TV viewers by offering its standalone web service to customers who want to leave cable or don’t already pay for cable.

[Re/code]

TIME movies

Netflix Inks Deal With Adam Sandler to Produce Four Films

Netflix
Bloomberg/Getty Images

The Happy Gilmore and Wedding Singer star is set to help Netflix smash the traditional model of movie releases, sending new flicks straight to fans' devices

Netflix has signed a deal with Adam Sandler to star in and produce four films that will premiere exclusively to subscribers of the online-streaming juggernaut.

The deal with Sandler, a longtime comic actor with as many critics’ flops as hits to his name, appears poised to catapult Netflix into a new era of serving not just as a warehouse for movies but also as a bona fide producer of them.

The expected Sandler films are also yet another challenge to traditional cinemas’ reign over the big business of movie premiers, as Netflix threatens to nix the high ticket prices and hyped-up midnight debuts from the process of putting new movies out.

Indeed, Netflix’s latest announcement comes just days after revealed a deal with production house the Weinstein Company to show the sequel to Crouching Tiger, Hidden Dragon on the streaming website and select IMAX screens.

Chaffing at the Internet heavyweight’s threat to the longtime model of movie releases, two major U.S. cinemas — Regal Cinemas and Chilmark — have said they will not show the film once it is released to the mass cinema market.

Netflix says the first installment of the Sandler films could hit its pages as soon as 2015, Variety reports. The quartet will be produced in collaboration with Sandler’s own production house, Happy Madison Productions.

“When these fine people came to me with an offer to make four movies for them, I immediately said yes for one reason and one reason only … Netflix rhymes with Wet Chicks,” said Sandler in a statement. “Let the streaming begin!”

Netflix new foray into movies builds on the success of its original television shows, which include the ultra-popular House of Cards and Orange Is the New Black.

TIME movies

Twilight Series to Be Rekindled With Films Released on Facebook

"The Twilight Saga: Breaking Dawn - Part 2" Panel - Comic-Con International 2012
The cast of The Twilight Saga: Breaking Dawn participate in Comic-Con International in San Diego on July 12, 2012 Albert L. Ortega—Getty Images

Bella and Edward will return — and these tween idols will be right where you’d expect: on social media

Production house Lionsgate and Twilight series author Stephenie Meyer will rekindle the vampire-themed saga with a series of short films posted on Facebook next year, it was announced Tuesday.

Five aspiring female film directors, selected by a group of female panelists, including Twilight actress Kristen Stewart, will direct the shorts, the New York Times reports.

“We think Facebook is a great way for us to introduce the world of Twilight to a whole new audience while re-energizing existing fans,” Michael Burns, Lionsgate’s vice chairman, told the Times.

The announcement reflects Facebook’s massive user base and its role as a sharing platform, as well hinting at a shake-up in the movie-distribution model toward one that does not involve cinemas or ticket sales.

The news comes just one day after Netflix said it had reached a deal with a production house to develop its first original movie, a sequel to Crouching Tiger, Hidden Dragon, which will be released exclusively on Netflix and in some IMAX theaters.

[NYT]

TIME movies

Netflix to Release First Original Movie

Crouching Tiger
Michelle Yeoh will reprise her role as Yu Shu-Lien in Crouching Tiger, Hidden Dragon: The Green Legend Netflix

Skip the line — or just skip the theater altogether

Netflix is planning to release its first original movie, a sequel to Ang Lee’s martial-arts epic Crouching Tiger, Hidden Dragon, and so charting new territory for the Internet-streaming firm.

Netflix said Monday that it is partnering with independent producer the Weinstein Co. to release Crouching Tiger, Hidden Dragon: The Green Legend to all subscribers on Aug. 28, 2015. The film, directed by Hong Kong’s Yuen Wo-ping, will also premiere at the same time on some global IMAX theaters — but it will not hit mainstream cinemas, Netflix said.

The deal between the streaming service and the production house threatens to upset to the traditional model of releasing movies: put them out first in cinemas and then wait months before making them available on DVD and streaming services, including Netflix. Indeed, Netflix said the film is the first of several feature movies it has in the pipeline.

Ted Sarandos, chief content officer at Netflix, told the New York Times that the deal would prove to Hollywood that moviegoers are consuming films in new ways — and are also ready for a new way of releasing films.

“What I am hoping is that it will be a proof point that the sky doesn’t fall,” he said. “These are two different experiences, like going to a football game and watching a football game on TV.”

Netflix, which this month expanded into the European market, has already released its own original series, including hits like House of Cards and Orange Is the New Black. The company releases all episodes of each show all at once, letting consumers binge-watch rather than suffice with weekly doses.

“The moviegoing experience is evolving quickly and profoundly, and Netflix is unquestionably at the forefront of that movement,” said Harvey Weinstein, co-chairman of the Weinstein Co., in a statement.

Netflix’s new film will star Michelle Yeoh, who will reprise her role from the original film as warrior Yu Shu Lien. Donnie Yen, of the Ip Man franchise, will star as Silent Wolf.

TIME Pop Culture

Popples Are Making a Comeback on Netflix

Netflix Popples Key Art -Final_ID-a282d05e0594
PR Newswire

Rejoice, lovers of all things 80s

Popples, those iconically colorful 1980s toys that turned briefly into cartoon characters, are getting a new lease of life next year on Netflix.

The online video streaming site announced a partnership with Saban Brands — the company behind children’s shows like Power Rangers and Ninja Turtles: The Next Mutation — to create a show based on the Popples, according to the Hollywood Reporter.

Netflix has ordered 26 half-hour episodes that will be available for streaming in late 2015, the Reporter says.

The series will revolve around five Popples named Bubbles, Sunny, Lulu, Izzy and Yikes, who are colorful creatures that live in Popplopolis and try to help everyone around them. Their good intentions usually backfire, leading to rather comical attempts at damage control.

Popples previously featured in a Saturday morning cartoon series that ran from 1986 to 1988.

“With the global reach of Netflix, we know Popples will reach a whole new generation of kids that will love it as much as their parents,” said Saban Brands founder Haim Saban.

[THR]

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