On Netflix’s first quarter earnings call on Monday, content chief Ted Sarandos said that he was open to having Netflix’s original movies appear on The Screening Room, Sean Parker’s alleged new startup that would let people pay $50 dollars to rent movies while they were still in theaters.
“We wouldn’t mind having our films available on that product,” Sarandos said. “To me, it would be a great way to get content to consumers, if they want to pay for it.”
Backed by “Lord of the Rings” director Peter Jackson, the idea behind The Screening Room is that you would pay $150 for a set-top box, and then $50 to rent a movie for 48 hours. These would be movies that are currently running in theaters, hence the high price. You would then reportedly also receive two tickets to see the movie in a physical theater, though that aspect of its business model may not be relevant to Netflix as its feature films have yet to see a wide theatrical release.
But when you think through the economics of renting a Netflix feature film on The Screening Room, it doesn’t make much sense for consumers.
Netflix has stood fast to the idea of “day-and-date” releases (having titles available on Netflix on the first day they are available anywhere). This has been a major source of tension between Netflix and movie theaters, which have largely refused to carry its original films. And Sarandos did not indicate that Netflix would be willing to give “The Screening Room” an exclusive window.
Without an exclusive window it’s hard to see why a customer would pay $50 for a single movie rental when a Netflix subscription costs $9.99 per month for the standard plan, and would offer access to the same film.