Summary

Starting next year, streaming platform Netflix is launching “experiential entertainment venues,” which it dubs Netflix Houses, to bring shows and movies to the big screen.
Netflix is strategically opening two physical locations to compete with theaters and capitalize on its programming with no fees, appealing to hardcore fans.
By turning to superstar names and cross-branding deals, Netflix aims to take advantage of a wobbly theater industry amid flat streaming market growth.

Evidently, cracking down on password sharing wasn’t enough for Netflix. After 15 years of getting used to watching Netflix in our underwear, washing down a bag of stale potato chips with another can of soda, and fading in and out of sleep as we binge an entire season of a TV show in one day, Netflix is counting on us changing our habits, doing a 180 about-face. But are customers ready to put on a pair of pants, fight through evening traffic, and exit through the gift shop? Netflix is banking on just that proposition. The announced Netflix House chain will cater to the whims of Netflix’s most zealous bingers, a one-stop destination for branded dining, social events, shopping… oh, and they plan on screening movies too.

So far, Netflix has announced only two locations, one opening in Dallas, Texas, and the other in King of Prussia (we swear that’s not a typo), Pennsylvania next year. If you’re scratching your head over this one, you’re not alone. It takes a closer look to see how Netflix differentiates itself from the stagnant, vanilla movie-theater facility we’ve come to know and not love anymore. It’s not an entirely new endeavor for them; they’ve been slowly buying theaters since 2019 to show their originals, including the Palisades Village Theater and Egyptian Theater in California and Paris Theater in New York City. Those installations pale in comparison to their upcoming theaters currently being constructed and retrofitted.

What does this say about consumers, and what does it say about the streamer? Looking at their latest moves, it is evident Netflix isn’t content to rest on their laurels. Netflix’s roster of entertainment is continually being bolstered, and they are willing to go outside their comfort zone to broaden their appeal. The next stage in multimedia fantasy is raiding IMAX’s customer base.

Netflix Is Redefining the Movie-Going Experience… Again.

Typically, Netflix is used as an excuse to stay in. Not for long. They’re calling it “experiential entertainment venues.” It sounds a lot cooler than “watching TV in the abandoned Macy’s.” Their official mouthpiece site, Tudum, sings the praises of the Netflix House venues as the next leap forward in entertainment, where you can fulfill all your fan fantasies… like buying merchandise you could probably get on eBay and getting liquored up at the bar. If you need Bridgerton toilet brushes or Squid Game-branded mud flaps, Netflix has you covered:

Building on previous Netflix live experiences for
Bridgerton
,
Money Heist
,
Stranger Things
,
Squid Game
, and Netflix Bites, Netflix House will go one step further and create an unforgettable venue to explore your favorite Netflix stories and characters beyond the screen year-round

Related Alamo Drafthouse Is Just the Latest Victim in the Corporate Destruction of Cinema The reason for the Alamo Drafthouse deal is probably not for the reason you think, and don’t wait for a Sony press release to explain either.

The last four years have been nothing short of a cataclysm for movie theaters. With hardly a month going by without a new onslaught of closures, bankruptcies, buy-outs, or “capital restructurings,” the business has gotten used to being up against the ropes with no tangible sign of recovery or good news for investors. That makes the Netflix announcement all the more intriguing. Time and again, they’ve bucked established common sense and prevailed. What does Netflix have up its sleeve this time, and why do they think they have a formula that can work?

Does Anyone Want to Watch TV in a Theater?
Stranger Things Release Date July 15, 2016 Main Genre Sci-Fi Seasons 4 Studio Netflix Expand

Brick-and-mortar retail might be losing profitability, but if Netflix Chief Marketing Officer Marian Lee has anything to say about the matter, Stranger Things fans will flock to repurposed strip malls for the chance to experience the show. The marketing hype frames the two flagship theaters as mini fan conventions, with every screening presented with the enthusiasm of a Star Wars prequel in 1999. There are some brand-specific statues out front and some sing-alongs and specialty cocktails inside.

Much like an amusement park, this will fixate only on the media giant’s library of original movies and serialized programs. While some will undoubtedly embrace the cosplay and “retail therapy,” as Netflix’s press release calls it, there’s something ironic about the very company that hastened the decline of movie theaters trying to turn its offerings into movie-theater-grade fare, taking over the same spaces, promising to do entertainment better than AMC or Regal ever could. The only difference now is fine dining and gift shops. Because why bother being the anchor of a mall when you can replace the entire complex, including the Gap and food court?

Related The Best Movies to Watch in Theaters This Summer Here is an extensive breakdown of every big movie being released for the summer 2024 movie season in theaters.

Don’t like their streaming dramas? Well, here it gets interesting because they have leveraged their influence to secure various sports broadcasting licenses in the last year. In the next few months, you can expect to see a highly-touted fight between YouTuber Jake Paul and Mike Tyson, NFL games, and WWE wrestling. In the future, those sorts of one-off events will likely be featured as viewing parties at the two theaters. Whether out of panic or business savvy, Netflix diversifies into theater chains. Think of Netflix House as the beachhead for their D-Day invasion.

What Are Netflix’s True Motivations?

There are two reasons that could explain the timing of Netflix’s fan-dangled physical locations. One is to outflank theater operators as they attempt to woo streamers locked in their air-conditioned houses to finally return to theaters. Regal is promising fog machines, IMAX screens, and “motion seats,” among other assorted gimmicks. Netflix has a different ploy, one we’ll cover in a moment. The second reason is that Netflix is simply swooping in to pick the theater industry’s carcass clean, airing its own programming with no distributor or exhibitor fees. If Netflix can revive interest in critically-despised films, there’s reason to believe they might pull the whole thing off. The Dallas and King of Prussia theaters are best interpreted as test markets to gauge further interest in the idea.

The IP is the selling point at Disney, but at Netflix, it’s all about the superstar personalities that drive sales. And no, we don’t just mean Adam Sandler. As Forbes’ Dana Feldman remarked recently, the company is entering into a high number of cross-branding deals with actors and actresses, feeding fans’ interest while getting them stuck in a loop, making performers’ back catalog available:

When releasing new titles with big names attached, it’s a wise move to allow viewers to find more to watch with the actors they know and love. This keeps Netflix’s subscribers happily binge-watching and helps the talent by showcasing and boosting older films and shows that younger fans may not be familiar with and that already established fans can rewatch.

The streaming ecosystem is currently at a glut right now. Amazon, Apple+, Disney+, and Max (formerly HBO Max) are all locked in a brutal quest to poach as many customers from each other as possible before they get bought out or go under and are sold off piecemeal; yup, we’re looking at you, Paramount. If Netflix’s competition is theaters, then why not bring the fight to their turf and finish them off? If Disney is their streaming rival, why not bring the fight to their doorstep with their own Netflix theme park?

We’ll have to wait some time to see whether their experiment will “disrupt” the theater industry or implode like so many overextended Regal Cinema franchises. Until then, remember you’re not at home, so turn off your freaking phone and keep your stinky shoes on, so we can enjoy The Crown in peace and quiet.