The recent announcement from Warner Bros., that the studio would be releasing every one of its 2021 theatrical films directly on HBO Max on the same date they open in theaters, sent shockwaves through the industry. It was an incredibly aggressive move that no other studio has come close to matching. While it will make the movies more accessible to those that can't or won't go to theaters, and is likely to significantly boost subscriptions for HBO Max, the move has seen its share of detractors, including Dune director Denis Villeneuve and it's production company Legendary, which may actually sue WB over all this. This is, at least in part, because the decision to release movies on HBO Max will have a negative financial impact on a lot of people outside of WB.
While the movie business is, at its core, about making art, it is also a business, and it's where the art and the business collide that we're finding one of the biggest issues with this plan. Many of the deals that Warner Bros. has with its major talent, like lead actors and directors, as well as the various guilds that represent the people behind the scenes, have financial plans that are structured around box office results. Often times actors and directors have contracts that guarantee them money on the "back end." This could be a certain percentage of the revenue, or perhaps a flat amount if the movie hits certain box office goals.
But of course, if a movie is never released in theaters, or if its box office is hampered by the fact that the film is also released streaming, then those previous deals don't pay out the way they otherwise would. It's understandable that people would be frustrated if they signed on to make a movie in part because of the compensation package, and then a large chunk of that money was taken away.
According to Variety, both Wonder Woman 1984 director Patty Jenkins and the film's star Gal Gadot, had deals like this, and part of the negotiation that brought that movie to HBO Max included making deals with the two of them. WB apparently paid out bonuses to them equal to what they would have received if the movie had made $1 billion at the global box office. Considering the first film made over $800 million, that's certainly a realistic number. It's also a number that, between the pandemic and the HBO Max release, Wonder Woman 1984 has essentially no chance of hitting.
The decision to release all of WB's 2021 films in the same way was reportedly done so quickly, and with so little discussion with the major players involved in each film, that there are no similar deals in place for the other projects. However, WB is reportedly at work on putting together some sort of formula that will determine what the pay out will be to lead actors and directors.
The fact that WB is planning on paying out something on these deals is certainly good news, though, of course, whatever number the studio comes up with will still need to be something the talent involved accepts. If they don't like the calculation, we could see the battle over these films continue on.
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