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      Pandemic Woes Lead Met Opera to Tap Endowment and Embrace New Work

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      Facing tepid ticket sales, the company will withdraw up to $30 million from its endowment and stage more operas by living composers, which have been outselling the classics.Hit hard by a cash shortfall and lackluster ticket sales as it tries to lure audiences back amid the pandemic, the Metropolitan Opera said Monday that it would withdraw up to $30 million from its endowment, give fewer performances next season and accelerate its embrace of contemporary works, which, in a shift, have been outselling the classics.The dramatic financial and artistic moves show the extent to which the pandemic and its aftermath continue to roil the Met, the premier opera company in the United States, and come as many other performing arts institutions face similar pressures.“The challenges are greater than ever,” said Peter Gelb, the Met’s general manager. “The only path forward is reinvention.”Nonprofit organizations try to dip into their endowments only as a last resort, since the funds are meant to grow over time while producing a steady source of investment income. The Met’s endowment, which was valued at $306 million, was already considered small for an institution of its size. This season it is turning to the endowment to cover operating expenses, to help offset weak ticket sales and a cash shortfall that emerged as some donors were reluctant to accelerate pledged gifts amid the stock market downturn. As more cash gifts materialize, the company hopes to replenish the endowment.To further cut costs, the company, which is giving 215 performances this season, is planning to reduce the number of performances next season by close to 10 percent.The Met’s decision to stage significantly more contemporary operas is a remarkable turnabout for the company, which largely avoided newer works for many decades because its conservative audience base seemed to prefer war horses like Puccini’s “La Bohème,” Verdi’s “Aida” and Bizet’s “Carmen.”But as the Met staged more new work in recent years that dynamic has begun to shift, a change that has grown more pronounced since the pandemic: While attendance has been generally anemic, contemporary works including Terence Blanchard’s “Fire Shut Up in My Bones” last season and Kevin Puts’s “The Hours” this season drew sellout crowds. (Verdi’s “Don Carlo,” by contrast, ended its run this month with 40 percent attendance.)Read More on the Coronavirus PandemicBoosters: Americans who received updated shots for Covid-19 saw their risk of hospitalization reduced by roughly 50 percent this fall compared with certain groups inoculated with the original vaccines, the Centers for Disease Control and Prevention reported.Seniors Forgo Boosters: Nearly all Americans over 65 got their initial Covid vaccines. But only 36 percent have received the bivalent booster, according to C.D.C. data.Free at-Home Tests: With cases on the rise, the Biden administration restarted a program that has provided hundreds of millions of tests through the Postal Service.Contagion: Like a zombie in a horror film, the coronavirus can persist in the bodies of infected patients well after death, even spreading to others, according to two startling studies.From now on, Mr. Gelb said, the Met will open each season with a new production of a contemporary work.It will begin next year with the company premiere of Jake Heggie’s “Dead Man Walking” and the season will feature its first performances of Anthony Davis’s “X: The Life and Times of Malcolm X”; Daniel Catán’s “Florencia en el Amazonas” and a staged production of John Adams’s “El Niño.” And Mr. Gelb said that the Met was rearranging next season to bring back “Fire Shut Up in My Bones” and “The Hours,” with its three divas, Renée Fleming, Joyce DiDonato and Kelli O’Hara, reprising their roles.Peter Gelb, the Met’s general manager, left, said that the company would embrace more contemporary works. He spoke with the composer Philip Glass in 2019. Sara Krulwich/The New York Times“Opera should reflect the times we’re in,” said Yannick Nézet-Séguin, the Met’s music director. “It’s our responsibility to generate new works so that people can recognize themselves and their realities on our stage.”Mr. Gelb said that the company’s change in strategy was possible in part because major stars are increasingly interested in performing music by living composers. “It’s a big shift in terms of opera singers themselves, embracing new work and understanding that this is the future,” he said.The Met has drawn many of the most illustrious singers of the day since Enrico Caruso ruled its stage, and it gave the world premiere of several Puccini operas and the American premiere of works by Richard Strauss and Wagner. It returned triumphantly last year after the long pandemic shutdown, which cost it $150 million in anticipated revenues. Audiences were back, though still lagging. Donations were up. And the determination of the whole company, including its artists and stagehands and ushers, was on full display: even as Omicron shut down many theaters last season, the Met never missed a curtain.By summer, however, the company, which has an annual budget of $312 million, making it the largest performing arts organization in the United States, began to feel the strains of the pandemic more acutely.Ticket revenues last season from in-person performances and the Met’s Live in HD cinema presentations were down by more than $40 million compared with before the pandemic. Paid attendance in the opera house has fallen to 61 percent of capacity, down from 73 percent. Donors have stepped in to fill much of the shortfall: During the pandemic, they have pledged more than $150 million in extra emergency funds. But amid the market downturn, some were hesitant to quickly deliver those gifts.“When the economy shudders, major donors shudder along with it,” Mr. Gelb said.The company had avoided dipping into its endowment in the early days of the pandemic, even as many other struggling opera companies and orchestras did, partly because it had taken the painful step of furloughing workers, including its orchestra and chorus, without pay. But now it has withdrawn $23 million from its endowment and can draw another seven million.A recent cyberattack that left the Met website and box office unable to sell new tickets for nine days has added to the company’s woes.But as more private donations come in — in the beginning of the new year the company expects to take in an additional $36 million in cash above its normal contributions — it hopes to replenish the endowment before the end of the fiscal year, at the end of July. It is unclear if that will be possible.“The Hours,” the new Kevin Puts opera starring Renée Fleming and Kyle Ketelsen, was such a strong seller this year that the company will bring it back next season. Sara Krulwich/The New York TimesThe Met’s decision to turn to its endowment undoes some of the work it has undertaken in recent years to build it back up. A few years ago the company announced a fund-raising drive to double the endowment, and took steps to lower the amount its draws from it each year down to 5 percent of its value, from 8 percent.The Met is not alone in finding it difficult to emerge from the pandemic.Portland Opera in Oregon, which is struggling with a prolonged decline in ticket sales, has reduced its staff and cut in half the number of operas it stages each season to three from six before the pandemic. “The situation currently facing Portland Opera is not unique, but it is still a crisis,” said Sue Dixon, the company’s general director, who said that the cuts were necessary in the short term but would hurt the company’s ability to grow back.The Philadelphia Orchestra has seen paid attendance hovering at around 47 percent this fall, down from about 66 percent before the pandemic, though a recent uptick in sales has provided some optimism. “Many people are not back in the habit,” said Matías Tarnopolsky, the president and chief executive of the orchestra and the Kimmel Center. “We need to remind them that it’s not only a beautiful and extraordinary and special experience, but it’s also easy and inexpensive.”Dayton Contemporary Dance Company, a troupe in Ohio, canceled its holiday shows this month because of tepid demand and rising production costs. And the Philly Pops, a 43-year-old orchestra, has announced plans to dissolve next year, citing mounting debt and a sharp decline in subscriptions during the pandemic.Verdi’s “Don Carlo” ended its run this fall with only 40 percent paid attendance.Ken Howard/Met OperaThe prospect of a recession next year is further rattling arts groups and raising fears that weak attendance could extend into next season and beyond. Federal assistance, which helped many companies survive the pandemic shutdown, has now largely dried up.“We’re still in this period of great uncertainty and anxiety,” said Simon Woods, the president and chief executive of the League of American Orchestras. “The need to build new audiences is more urgent than ever.”For many opera companies and orchestras, the pandemic has accelerated the decline of the subscription model for selling tickets, which was once a major source of revenue.At the Met, subscriptions are expected to fall to 19 percent of total box office revenues this season, compared with 45 percent two decades ago. As single tickets become more popular, and some older subscribers stay at home because of virus fears, the average age of the Met’s audience has dropped to 52, from 57 in 2020.Mr. Nézet-Séguin, who became the Met’s music director in 2018, succeeding James Levine, who led the company for four decades, said the company would remain committed to the classics even as it embraced innovation. And he said that the company could try to appeal to different audiences with an array of works, both old and new.“I want everyone to feel welcome at the Met,” he said. “Will they fall in love with every opera we do? Of course not. But I don’t want anyone to say, ‘The Met is not for me.’” More

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      Met Opera’s Website and Box Office Are Back, 9 Days After Cyberattack

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      Hackers had left the Met, the largest performing arts organization in the United States, unable to sell tickets as it tries to recover from the pandemic.Nine days after an audacious cyberattack struck the Metropolitan Opera, forcing its website offline, paralyzing its box office and hobbling its ability to sell tickets, the company announced on Thursday that those services had been restored.“After suffering a cyberattack that temporarily impacted our network systems, we’re pleased to announce that the Met is now able to process ticket orders through our website and in person at our box office,” the Met said in a message on its website, which reassured customers that no credit card information had been stolen during the attack.The resumption of ticket sales at the Met, the largest performing arts organization in the United States, marked the conclusion of what the company said was the first major cyberattack in its 139-year history. The attack, coming during the usually lucrative holiday period, knocked out the company’s ticketing system at a time when it would typically handle about $200,000 in sales each day.The targeting of the Met, which dealt the company a blow as it struggles to lure audiences back to prepandemic levels, underscored that even venerable cultural institutions are not immune to cyberattacks in the digital age.“This attack froze everything,” said Peter Gelb, the Met’s general manager, who said that it had wreaked havoc, undermining the electronic payment system for the company’s 3,000 full- and part-time employees and hampering its ability to order sets for upcoming productions. “The teachable moment of this attack is that if someone wants to break into your system, it is hard to stop them.”Despite the disruption, the Met never missed a performance, continuing to stage its grandiose old-school production of Verdi’s “Aida,” with its huge cast and towering sets, and the new Kevin Puts opera “The Hours,” starring Renée Fleming, Kelli O’Hara and Joyce DiDonato and inspired by Michael Cunningham’s Pulitzer Prize-winning 1998 novel. Without its regular ticket system, the opera house offered $50 general admission tickets for seats that usually cost several times that much, through a website set up by Lincoln Center. Gelb said Thursday that prices would return to normal levels.Gelb said it appeared that the attack has been orchestrated by an organized criminal gang, and that the F.B.I. was aware of the attack.Cybersecurity experts said the attack had all the hallmarks of a ransomware attack, a form of modern-day piracy that has become a global scourge in recent years, as attackers target local governments, businesses, hospitals and, now, cultural institutions.Experts said the crime is widespread. In some cases victims receive an email with a link or attachment that contains software that encrypts files on their computer and holds them hostage until they pay a ransom.While the attack had added to the Met’s woes, Gelb said the company was undeterred. Paraphrasing a line from Terence Blanchard’s opera “Fire Shut Up in My Bones,” which was performed at the Met last year, he said: “We bend but we don’t break.” More

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      A Cyberattack Shuts the Met Opera’s Box Office, but the Show Goes On

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      After hackers knocked out the ticket-selling system of the Met, the largest performing arts organization in the United States, the company decided to sell $50 general admission seats.It had been a full week since a brazen cyberattack had hobbled the Metropolitan Opera, taking its website offline and paralyzing its box office, and hundreds of opera lovers were waiting patiently in line Tuesday evening, fluctuating between anxiety and anticipation.The curtain was set to rise on the Met’s grandiose old-school production of Verdi’s “Aida” in 45 minutes, and 300 audience members had managed to score the sold-out $50 general admission tickets that the cyberattack had forced the company to offer as a workaround until its computer systems are fully restored.Some had feared a “running of the bulls” situation, with opera lovers jockeying for prime seats that ordinarily cost as much as $350 apiece. But the human choreography amid the technological mayhem was fairly seamless. The general-admission hordes, who had bought their tickets on a hastily assembled page on Lincoln Center’s website, were directed to side corridors of the Met’s 3,800-seat auditorium. There, ushers handed them improvised tickets, their seat numbers handwritten in black magic marker, distributed on a first-come-first-served basis.“It’s frightening that a cyberattack can happen at a place like the Met,” said Mike Figliulo, 42, a technology director on Broadway, as he marched triumphantly to his $50 seat in row M of the orchestra.The attack on the Met, the largest performing arts organization in the United States, knocked out a ticketing system that typically handles about $200,000 in sales each day at this time of year, and took down the company’s payroll system, forcing it to cut checks by hand for some of its 3,000 full- and part-time employees. It was the latest major disruption for a company struggling to lure audiences back to prepandemic levels, and it hit just as the lucrative holiday season was getting underway.“With this attack, it feels like we have entered the ninth circle of hell,” Peter Gelb, the Met’s general manager, said Tuesday during a pause in a rehearsal for an upcoming English-language holiday production of “The Magic Flute” that is popular with families. “It adds strain on a company that has suffered innumerable strains and challenges since the pandemic from which we are still recovering.”The Met’s outspoken support for Ukraine — it presented “A Concert for Ukraine” last season; helped arrange a tour by the newly formed Ukrainian Freedom Orchestra; and parted ways with one of its reigning prima donnas, the Russian soprano Anna Netrebko, after she declined to distance herself from President Vladimir V. Putin of Russia — led to speculation that Russia could be behind the cyberattack.Gelb tamped down that theory, saying that the attack appeared to be the work of an organized criminal gang. He said the Met had informed the F.B.I. of the attack, and that he hoped that the box office would be running as early as Wednesday.“I can understand why there might be conjecture that Russia is behind this, given the Met’s strong condemnation of Putin and defense of Ukraine,” he said. “But we don’t believe Putin is masterminding cyberattacks on opera companies. And if he is, that is a good reason that the Russians are losing the war.”The seating of people with $50 general admission tickets went smoothly. Jeenah Moon for The New York TimesGelb declined to elaborate on who was behind the attack. But cybersecurity experts said that, given how long it was taking the Met to get back online, the attack bore the hallmarks of an increasingly prevalent type of modern-day piracy that has targeted businesses, local governments, hospitals and even hotels. The weapon? A type of software known as ransomware.The crime is as simple as it is effective. In some cases victims receive an email with a link or attachment that contains software that encrypts files on their computer and holds them hostage until they pay a ransom.Ransomware has become a global scourge. A ransomware attack this fall disrupted the government of Suffolk County, on Long Island, forcing it largely offline. Five years ago, one of the largest ransomware attacks in recent memory left thousands of computers at companies in Europe, universities in Asia and hospitals in Britain crippled or shut down — in some cases, paralyzing hospital equipment before patients were poised to go into surgery.Justin Cappos, a cybersecurity expert at New York University’s department of computer science and engineering, said hackers who carry out such attacks frequently operate in Russia and Eastern Europe, and often demand a ransom in Bitcoin, a digital currency that is hard to trace. A Bitcoin payment also can’t be rescinded once it is made.He said that the targeting of cultural institutions like the Met was surprising, given that they typically have limited financial resources. Nevertheless, he said, the attackers might have been motivated by the audacity of targeting such a global and glittering brand.“Every organization needs to care about cybersecurity, even cultural organizations like the Met,” Cappos said. This attack, he added, underscored that “nobody is safe.”The Met — which never missed a curtain last year, even when the Omicron variant shut down wide swaths of Broadway, dance performances and concerts — has managed to proceed with all of its performances through the current cyberattack, staging Verdi’s “Rigoletto” and “Aida” and its new production of Kevin Puts’s “The Hours,” starring Renée Fleming, Kelli O’Hara and Joyce DiDonato, which was simulcast as planned to movie theaters around the world on Saturday as part of the Met’s Live in HD series.With war raging in Europe, record inflation and the continuing effects of the pandemic, cultural institutions across the world, including the Met, have been struggling economically. But Gelb said the Met was resilient.“Our lives have been turned upside down,” he added. “But we’ll get through it.”The operagoers who went to the Met on Tuesday evening were transported back to a grand operatic vision of ancient Egypt, with soaring arias and choruses telling a story of doomed love and divided loyalties. One scene stealer was an unruly pony named Sandy who stomped its hoof and shook its head aggressively during the larger-than-life Triumphal Scene, eliciting nervous laughter from the audience.The audience was able to forget, at least temporarily, that it was at the center of an opera house under siege. More

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      Met Opera, Reeling From Cyberattack, Will Sell Tickets on New Site

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      The company’s computer systems have been down for more than three days. It will now use a Lincoln Center website to offer $50 general admission seats to some performances.Three days after a cyberattack first paralyzed its website and box office, the Metropolitan Opera on Friday announced that it would sell $50 tickets to some performances on a site run by Lincoln Center.The Met, in a brief note posted on social media, said it would offer the general admission tickets as it worked to fully restore its computer systems, which have been down since Tuesday morning. The company has proceeded with all of its performances, including of “Aida” and “The Hours,” but the Met has been unable to sell any new tickets, including in its last-minute rush ticket program.“We appreciate your patience through this difficult time as we work to resolve the issue and resume full operations,” the note said.The attack has wreaked havoc as the Met prepares for a string of holiday productions. At this time of year, the company’s ticketing systems typically handle about $200,000 in sales each day.Peter Gelb, the Met’s general manager, said it could be several more days before the Met’s ticketing site is fully restored. The attack has also sidelined the company’s internal networks, including its payroll system.“It takes time, because when you have been hacked, you have to be sure that whatever functions are going back online are not going to be compromised,” he said.Gelb said the Met was still investigating who had carried out the attack and assessing the damage.Separately, the Musikverein, a concert hall in Vienna, posted a message this week saying its website was unavailable. “We apologize for the inconvenience and hope to be able to provide our usual service as soon as possible,” the Musikverein said.The cyberattack comes at a difficult time for the Met, which is still working to recover from the turmoil of the coronavirus pandemic and lure back audiences. Attendance is well below prepandemic levels.“At a time when you’re trying to get more people interested in opera and attending your performances, it’s incredibly frustrating,” Gelb said. “We all want the same thing, which is to make it easier for people to attend performances, not more difficult.”The Met will offer $50 tickets for three upcoming performances of Verdi operas: “Rigoletto” on Sunday and Wednesday, and “Aida” on Tuesday. Since the Met cannot connect to its ticketing system to see which seats have already been sold, the $50 seats will be general admission. Customers who buy the tickets will be given empty seats in the orchestra section on a first-come, first-served basis immediately before curtain.Tickets are being sold on www.lincolncenter.org/metopera. More

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      Highbrow Films Aimed at Winning Oscars Are Losing Audiences

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      The kind of critically praised dramas that often dominate the awards season are falling flat at the box office, failing to justify the money it takes to make them.A year ago, Hollywood watched in despair as Oscar-oriented films like “Licorice Pizza” and “Nightmare Alley” flatlined at the box office. The day seemed to have finally arrived when prestige films were no longer viable in theaters and streaming had forever altered cinema.But studios held out hope, deciding that November 2022 would give a more accurate reading of the marketplace. By then, the coronavirus would not be such a complicating factor. This fall would be a “last stand,” as some put it, a chance to show that more than superheroes and sequels could succeed.It has been carnage.One after another, films for grown-ups have failed to find an audience big enough to justify their cost. “Armageddon Time” cost roughly $30 million to make and market and collected $1.9 million at the North American box office. “Tár” cost at least $35 million, including marketing; ticket sales total $5.3 million. Universal spent around $55 million to make and market “She Said,” which also took in $5.3 million. “Devotion” cost well over $100 million and has generated $14 million in ticket sales.Even a charmer from the box office king, Steven Spielberg, has gotten off to a humdrum start. “The Fabelmans,” based on Mr. Spielberg’s adolescence, has collected $5.7 million in four weeks of limited play. Its budget was $40 million, not including marketing.What is going on?The problem is not quality: Reviews have been exceptional. Rather, “people have grown comfortable watching these movies at home,” said David A. Gross, a film consultant who publishes a newsletter on box office numbers.“The Fabelmans,” directed by Steven Spielberg, has gotten off to a slow start at the box office.Merie Weismiller Wallace/Universal Pictures and Amblin EntertainmentEver since Oscar-oriented films began showing up on streaming services in the late 2010s, Hollywood has worried that such movies would someday vanish from multiplexes. The diminishing importance of big screens was accentuated in March, when, for the first time, a streaming film, “CODA” from Apple TV+, won the Academy Award for best picture. ‘Tár’: A Timely Backstage DramaCate Blanchett plays a world-famous conductor who is embroiled in a #MeToo drama in the latest film by the director Todd Field.Review: “We don’t care about Lydia Tár because she’s an artist; we care about her because she’s art,” our critic writes about the film’s protagonist.An Elusive Subject: Blanchett has stayed one step ahead of audiences by constantly staying in motion. In “Tár,” she is as inscrutable as ever.Back Into the Limelight: The film marks Field’s return to directing, 16 years after “In the Bedroom” and “Little Children” made waves.The Song of the Fall?: A 120-year-old symphony by the composer Gustav Mahler is finding new life with unlikely listeners after a star turn in the film.This is about more than money: Hollywood sees the shift as an affront to its identity. Film power players have long clung to the fantasy that the cultural world revolves around them, as if it were 1940. But that delusion is hard to sustain when their lone measuring stick — bodies in seats — reveals that the masses can’t be bothered to come watch the films that they prize most. Hollywood equates this with cultural irrelevancy.Sure, a core crowd of cinephiles is still turning out. “Till,” focused on Mamie Till-Mobley, whose son, Emmett Till, was murdered in Mississippi in 1955, has collected $8.9 million in the United States and Canada. That’s not nothing for an emotionally challenging film. “The Banshees of Inisherin,” a dark comedy with heavily accented dialogue, has also brought in $8 million, with overseas ticket buyers contributing an additional $20 million.“While it is clear the theatrical specialty market hasn’t fully rebounded, we’ve seen ‘The Banshees of Inisherin’ continue to perform strongly and drive conversation among moviegoers,” Searchlight Pictures said in a statement. “We firmly believe there’s a place in theaters for films that can offer audiences a broad range of cinematic experiences.”Still, crossover attention is almost always the goal, as underlined by how much film companies are spending on some of these productions. “Till,” for instance, cost at least $33 million to make and market.And remember: Theaters keep roughly half of any ticket revenue.The hope is for results more in line with “The Woman King.” Starring Viola Davis as the leader of an all-female group of African warriors, “The Woman King” collected nearly $70 million at domestic theaters ($92 million worldwide). It cost $50 million to produce and tens of millions more to market.“The Woman King,” starring Viola Davis, is one of the few Oscar-oriented films this year that has struck a box office chord, bringing in about $70 million.Ilze Kitshoff/Sony PicturesOscar-oriented dramas rarely become blockbusters. Even so, these movies used to do quite well at the box office. The World War I film “1917” generated $159 million in North America in 2019 and $385 million worldwide. In 2010, “Black Swan,” starring Natalie Portman as a demented ballerina, collected $107 million ($329 million worldwide).Most studios either declined to comment for this article or provided anodyne statements about being proud of the prestige dramas they have recently released, regardless of ticket sales.The unwillingness to engage publicly on the matter may reflect the annual awards race. Having a contender labeled a box office misfire is not great for vote gathering. (Oscar nominations will be announced on Jan. 24.) Or it may be because, behind the scenes, studios still seem to be grasping for answers.Ask 10 different specialty film executives to explain the box office and you will get 10 different answers. There have been too many dramas in theaters lately, resulting in cannibalization; there have been too few, leaving audiences to look for options on streaming services. Everyone has been busy watching the World Cup on television. No, it’s television dramas like “The Crown” that have undercut these films.Some are still blaming the coronavirus. But that doesn’t hold water. While initially reluctant to return to theaters, older audiences, for the most part, have come to see theaters as a virus-safe activity, according to box office analysts, citing surveys. Nearly 60 percent of “Woman King” ticket buyers were over the age of 35, according to Sony Pictures Entertainment.Hollywood considers anyone over 35 to be “old,” and this is who typically comes to see dramas.Maybe it is more nuanced? Older audiences are back, one longtime studio executive suggested, but sophisticated older audiences are not — in part because some of their favorite art house theaters have closed and they don’t want to mix with the multiplex masses. (He was serious. “Too many people, too likely to encounter a sticky floor.”)Grim dramas have struggled, but sparkly ones have succeeded. “Elvis,” starring Austin Butler, took in $151 million in North America.Warner Bros.Others see a problem with the content. Most of the movies that are struggling at the box office are downbeat, coming at a time when audiences want escape. Consider the successful spring release of the rollicking “Everything, Everywhere All at Once,” which collected $70 million in North America. Baz Luhrmann’s bedazzled “Elvis” delivered $151 million in domestic ticket sales. .“People like to call it ‘escape,’ but that’s not actually what it is,” Jeanine Basinger, the film scholar, said. “It’s entertainment. It can be a serious topic, by the way. But when films are too introspective, as many of these Oscar ones now are, the audience gets forgotten about.“Give us a laugh or two in there! When I think about going out to see misery and degradation and racism and all the other things that are wrong with our lives, I’m too depressed to put on my coat,” continued Ms. Basinger, whose latest book, “Hollywood: The Oral History,” co-written with Sam Wasson, arrived last month.Some studio executives insist that box office totals are an outdated way of assessing whether a film will generate a financial return. Focus Features, for instance, has evolved its business model in the last two years. The company’s films, which include “Tár” and “Armageddon Time,” are now made available for video-on-demand rental — for a premium price — after as little as three weeks in theaters. (Before, theaters got an exclusive window of about 90 days.) The money generated by premium in-home rentals is substantial, Focus has said, although it has declined to provide financial information to support that assertion.Some films, like “Armageddon Time,” now become available for digital rental after they spend just three weeks in theaters.Anne Joyce/Focus FeaturesThe worry in Hollywood is that such efforts will still fall short — that the conglomerates that own specialty film studios will decide there is not enough return on prestige films in theaters to continue releasing them that way. Disney owns Searchlight. Comcast owns Focus. Amazon owns United Artists. The chief executives of these companies like being invited to the Oscars. But they like profit even more.“The good news is we’ve now got a very large streaming business that we can go ahead and redirect that content toward those channels,” Bob Chapek, Disney’s former chief executive, said at a public event on Nov. 8, referring to prestige films. (Robert A. Iger, who has since returned to run Disney, may feel differently.)Others continue to advocate patience. Mr. Gross pointed out that “The Fabelmans” will roll into more theaters over the next month, hoping to capitalize on awards buzz — it is a front-runner for the 2023 best picture Oscar — and the end-of-year holidays. Damien Chazelle’s “Babylon,” a drug-and-sex induced fever dream about early Hollywood, is scheduled for wide release on Dec. 23.“I think movies are going to come back,” Mr. Spielberg recently told The New York Times. “I really do.”Steven Spielberg, on the set of his production “The Fabelmans.” Merie Weismiller Wallace/Universal Pictures and Amblin Entertainment More

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      ‘Glass Onion’ and ‘Matilda’ Test Netflix’s Approach to Theatrical Releases

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      The company agreed to some exclusive theatrical distribution for “Glass Onion” and “Matilda the Musical,” but it’s not clear exhibitors will get much more.“Glass Onion: A Knives Out Mystery,” the much-anticipated follow-up to the 2019 sleeper hit directed by Rian Johnson, was supposed to be the moment Netflix crossed the Rubicon.Rather than give the film a perfunctory theatrical release — a strategy designed to ensure most viewers ultimately watch a movie on the streaming service — Netflix, in a first, would give the film a traditional, exclusive run in a large number of cinemas.It didn’t happen.After much back and forth, and contrary to the wishes of some Netflix employees and Mr. Johnson, a theatrical release for “Glass Onion” that at one point some people inside the company hoped would reach up to 2,000 screens ended up at 638 in the United States. The movie, which was released on Wednesday and has received positive reviews, will run in theaters for just one week before becoming available on Netflix on Dec. 23.What was supposed to be the moment to prove the value of theaters to the streaming giant will not come to pass. Yet the company is also involved in another intriguing theatrical experiment this weekend, one that could end up providing Netflix with even more valuable feedback.On Friday, “Matilda the Musical,” financed and produced by Netflix, will open on more than 1,500 screens in 670 locations across the United Kingdom and Ireland. The movie, starring Emma Thompson as the villainous Miss Trunchbull, will be released and promoted by Sony Pictures, which, in a unique one-picture deal, licensed the rights to Netflix on the condition that Sony could hold onto the United Kingdom for a theatrical release. (“Matilda,” which is based on a stage musical that itself is based on a children’s book by Roald Dahl, is beloved in the United Kingdom. The musical has been running in London’s West End since 2011.)“It will be a good example of what could be done,” said Tim Richards, founder and chief executive of Vue International, a London-based exhibitor with theaters in countries including the United Kingdom, Denmark, Germany and Italy. “If there was ever a film made for the big screen, it’s ‘Matilda.’”Sony Pictures, which declined to comment for this article, bought the film rights to “Matilda the Musical” in 2015, with the show’s director, Matthew Warchus, set to oversee the adaptation. At the same time, Netflix was trying to bolster its roster of family films and had its eye on the Roald Dahl estate. (In 2021, Netflix ultimately purchased the entire Dahl estate, giving the company the ability to adapt books like “Charlie and the Chocolate Factory” and “The BFG” into films and television shows, while also controlling the publishing rights.)At the end of 2019, the companies entered into an arrangement whereby Netflix would finance “Matilda the Musical” and produce it in conjunction with Sony and Working Title Films, a U.K. producer. Netflix would control rights to the finished product worldwide, excluding the United Kingdom and Ireland, where Sony would own the rights and release the film theatrically. “Matilda the Musical” will not appear on Netflix in the United Kingdom or Ireland until next summer, though it will be available to stream in the United States and other countries on Christmas.“Matilda the Musical” is receiving a traditional theatrical release in the United Kingdom.NetflixSo far the film has received positive reviews. The Independent deemed it “a frothy, whimsical delight,” while The Guardian called it “a tangy bit of entertainment, served up with gusto.” It has a 100 percent positive rating on Rotten Tomatoes and could do the kind of business that the original “Peter Rabbit” did at the British box office, where it sold $54 million in tickets.Whether the box office performances of “Glass Onion” and “Matilda” have any long-term impact on Netflix’s approach to theatrical distribution is a big question. According to three people with knowledge of Netflix’s inner workings, numerous executives in the company’s film group would like Netflix to embrace a more traditional strategy regarding film releases, but the co-chief executives, Ted Sarandos and Reed Hastings, remain focused on streaming. “There is no question internally that we make our movies for our members, and we really want them to see them on Netflix,” Mr. Sarandos said on an earnings call last month, adding, “Most people watch movies at home.”.css-1v2n82w{max-width:600px;width:calc(100% – 40px);margin-top:20px;margin-bottom:25px;height:auto;margin-left:auto;margin-right:auto;font-family:nyt-franklin;color:var(–color-content-secondary,#363636);}@media only screen and (max-width:480px){.css-1v2n82w{margin-left:20px;margin-right:20px;}}@media only screen and (min-width:1024px){.css-1v2n82w{width:600px;}}.css-161d8zr{width:40px;margin-bottom:18px;text-align:left;margin-left:0;color:var(–color-content-primary,#121212);border:1px solid var(–color-content-primary,#121212);}@media only screen and (max-width:480px){.css-161d8zr{width:30px;margin-bottom:15px;}}.css-tjtq43{line-height:25px;}@media only screen and (max-width:480px){.css-tjtq43{line-height:24px;}}.css-x1k33h{font-family:nyt-cheltenham;font-size:19px;font-weight:700;line-height:25px;}.css-1hvpcve{font-size:17px;font-weight:300;line-height:25px;}.css-1hvpcve em{font-style:italic;}.css-1hvpcve strong{font-weight:bold;}.css-1hvpcve a{font-weight:500;color:var(–color-content-secondary,#363636);}.css-1c013uz{margin-top:18px;margin-bottom:22px;}@media only screen and (max-width:480px){.css-1c013uz{font-size:14px;margin-top:15px;margin-bottom:20px;}}.css-1c013uz a{color:var(–color-signal-editorial,#326891);-webkit-text-decoration:underline;text-decoration:underline;font-weight:500;font-size:16px;}@media only screen and (max-width:480px){.css-1c013uz a{font-size:13px;}}.css-1c013uz a:hover{-webkit-text-decoration:none;text-decoration:none;}What we consider before using anonymous sources. Do the sources know the information? What’s their motivation for telling us? Have they proved reliable in the past? Can we corroborate the information? Even with these questions satisfied, The Times uses anonymous sources as a last resort. The reporter and at least one editor know the identity of the source.Learn more about our process.Netflix declined to comment for this article.Discussions about a significant theatrical release for Netflix’s biggest movies began in earnest in April, after the company’s stock dropped 35 percent following a dismal first-quarter earnings report, according to the three people, who spoke on condition of anonymity to describe internal matters. “Glass Onion,” one of two “Knives Out” sequels the company purchased for $450 million in 2021, seemed to be the perfect candidate. The original grossed an impressive $165 million domestically — a notable feat for a movie not based on any well-known intellectual property.Spencer Klein, the company’s distribution director, went to the theater owners’ trade convention in Las Vegas to inform eager exhibitors that in light of Netflix’s subscriber slowdown, the company was considering wider theatrical releases. The issue was again brought up at a retreat for senior management in May and discussions continued in June, the people said, when there were preliminary talks about pushing back the streaming debut of the action-adventure film “The Gray Man” to allow for additional time in theaters. (This idea, specifically, never gained much traction.)Each conversation ended the same way, the three people said, with Mr. Sarandos adamant that a theatrical model was a confusing distraction and that the company’s best films should debut on Netflix. It wasn’t until September that Mr. Sarandos re-engaged in the debate, allowing his film team to use “Glass Onion” to test the market to examine two things: whether big-budget Netflix films could make money in theaters, even with the added marketing and print costs required; and whether those additional marketing costs would ultimately improve the film’s performance on the streaming platform.Netflix is releasing “Glass Onion” in more than 600 theaters, but that’s below what some in the company’s film group wanted.Netflix, via Associated PressScott Stuber, Netflix’s film chief, was hoping to put “Glass Onion” into a wide release, anywhere from 1,000 to 2,000 screens, according to the people familiar with the discussions. Mr. Sarandos wanted 500. They agreed to more than 600 with a 30-day window between the film’s theatrical debut and its appearance on streaming. Mr. Sarandos demanded that it play for just one week and that the exhibitors promise not to release the box office numbers to the news media. For the first time, the two largest theater chains in the United States, AMC Theatres and Regal Cinemas, agreed to a deal with Netflix, along with other smaller chains. AMC’s chief executive, Adam Aron, said in a statement at the time that the deal showed that “both theatrical exhibitors and streamers can continue to coexist successfully.”That enthusiasm was short-lived, stifled when Mr. Sarandos emphasized his commitment to streaming during last month’s earnings call.Some of the large exhibitors were considering backing out of the deal after his remarks, according to one of the people familiar with the company’s inner workings. They remained only because they hoped a success story would change the top executives’ thinking. It helped that Netflix had committed a healthy budget to marketing “Glass Onion,” running commercials during “Sunday Night Football” and “Saturday Night Live,” and showing the trailer in theaters before movies like “Black Panther: Wakanda Forever” and “Ticket to Paradise.” “We want as many people as possible to see it in theaters,” Mr. Johnson, the director of “Glass Onion,” told The Hollywood Reporter this week about the film. “And then we want it to do incredibly well when it hits Netflix — so lots of people see it and so it demonstrates to everybody, most of all Netflix, that these two things can coexist.”Mr. Sarandos’s thinking runs counter to what other major studio heads now believe. “I’ve seen the data,” David Zaslav, the chief executive of Warner Media Discovery, said during a recent investor conference. “A movie that opens in the theater performs five times as well as a movie that you put direct to streaming.”Yet, releasing films theatrically is far from a sure thing these days. The U.S. box office is down some 32 percent compared with 2019, and the pandemic significantly altered moviegoing habits. Older moviegoers have yet to return to the cinema in big numbers, and studios are making fewer films, 36 percent fewer, in fact. One exhibitor said that if the three big streaming companies — Netflix, Amazon and Apple — released roughly 20 movies in theaters each year in total, that would help make up for the deficit and potentially return the business to a healthy place.Until then, theater chains are hopeful that releases like “Glass Onion” and “Matilda” will convince the companies to try more like them.“I’m hoping that ‘Glass Onion,’ even though it’s a very limited release, will deliver sufficient numbers that will certainly tweak some interest into doing something more in the future because they’ve got some amazing movies coming up,” Mr. Richards of Vue International said. “They’re moving slowly but I’m hopeful that there will be a change in thinking.” More