Your phone is buzzing, your bank account balance is staring you in the face, and you’re mentally sprinting through your schedule. No, it’s not an emergency. You’re just trying to make the crucial choice whether to see a new movie in theaters or wait for it to become available at home. That seemingly small sentimental difference? It’s actually quantifiable. In fact, it helps drive behind-the-scenes decision-making that determines why some movies go straight to video-on-demand (VOD) or streaming while others head to multiplexes.
While theatrical cinema remains the epicenter of Hollywood’s cultural engine, we live in a digital world that requires more strategic approaches to distribution. Whether you’re enjoying the latest Marvel blockbuster in (increasingly less) crowded theaters or settling on the couch to watch Netflix’s newest highly irrational action movie, there is an economic logic and strategy as to which films go where and why.
I’ve previously covered all the reasons why theatrical cinema tends to generate the highest financial return for studios, especially among bigger-budget fare. For a quick recap:
- Pay-per-view (PPV), premium video-on-demand (PVOD) and standard VOD allow multiple viewers for just one transaction, whereas theatrical tickets are sold individually.
- Traditional theatrical releases can be monetized across several windows—theatrical release, electronic sell-through (EST), DVD/VOD rental, Pay One, Network, Pay Two—while streaming exclusives typically remain trapped on a single platform for all of eternity.
- Theatrical success drives broader success (franchise building, licensing, merchandise, theme parks, etc.) thanks to a deeper cultural footprint. You don’t exactly see Red Notice hoodies flying off store shelves, do you?
In reality, the two mediums can be complementary. In the U.S., film studios generally split ticket revenue with movie theaters 50/50. But with VOD, studios keep roughly 80 percent of the revenue. VOD, syndication and streaming can also turn theatrical losses into break-evens or profit over time. Maximizing earnings potential means choosing the release strategy that best positions it for success with us viewers. That means determining whether it has breakout potential in theaters or might connect more if it skips theaters entirely.
From big screen to small screen (or the other way around)
In 2020, Universal Pictures shattered the decades-long precedent of keeping movies exclusively in theaters for around 90 days before making it available anywhere else. Faced with pandemic-related challenges, Universal opted to release films on PVOD between 17 and 31 days after their theatrical debuts depending on box office openings. While there’s a debate as to the long-term audience effects this strategy yields, Universal has finished top three in domestic box office market share in four of the last five years, per The Numbers.
Wicked is arguably this new model’s greatest success story. The Best Picture-nominated musical defied gravity with $756 million at the worldwide box office before scoring a record $70 million on PVOD in its first week of availability and more than $100 million total, with Universal keeping 80 percent of that PVOD revenue. The film’s overwhelming success in theaters and on PVOD served as a gigantic advertisement for its eventual run on Peacock. It racked up around 40 million hours of viewership in the U.S., according to Nielsen, contributing to subscriber acquisition and retention along the way. (Wicked was the second most-streamed 2025 Oscar nominee and one of Peacock’s most viewed films, per analyst Entertainment Strategy Guy). That’s a long and lucrative value chain.
Similar success stories have also been seen in riskier projects. A Minecraft Movie, while based on one of the most popular games in the world, was not considered a guaranteed home run in theaters. Yet, it earned a whopping $950 million worldwide. In the week of its release, a solid 53 percent of viewers that were aware of the film said they would be willing to pay a fee (either a theatrical ticket or a VOD transaction) to see it, according to Greenlight Analytics’ film tracking service The Quorum, where I work as Director of Insights & Content Strategy.
This indicated a long runway of revenue potential, which was ultimately true. Samba TV reported that more than 470,000 U.S. households watched A Minecraft Movie in its first five days of availability on VOD. This alone likely added millions in additional revenue across rentals and digital purchases. It helps to demonstrate how theatrical hits can translate into leggy VOD successes and beyond.
It’s not the only instance of companies following the data to successful results. Paramount’s horror thriller Smile was originally made as a streaming-exclusive film. But unexpectedly sky-high test scores convinced studio executives to give it a full theatrical release. That pivot paid off: the film and its sequel have earned more than $355 million at the global box office against a combined budget of $45 million.
These are all examples of how studios use an array of different inputs to inform where and how they’ll deliver a movie to eager audiences.
When VOD and streaming out-perform theatres
The opposite is true, too. Timothee Chalamet’s cannibal romance Bones and All earned just $15 million in theaters against a $20 million production budget and a chunk more for marketing. The movie’s healthy 56 percent willingness to pay a fee score in the week of release alongside low awareness and interest scores, per The Quorum, suggests it may have been better suited for a direct VOD/streaming release to save on marketing. I’m a theaters-first kind of guy overall (and a lot of data backs that up), but for smaller-budget films there is more flexibility. Even Netflix overhauled its original film strategy to emphasize more cost-efficient bets.
We see similar indicators across a wide range of films that help us better understand audience and studio behavior. Big-budget disappointment Snow White generated concerningly low Quorum interest scores prior to its release, providing advance warning for its poor box office performance ($206 million globally). However, it then saw a 405 percent spike in viewership when it hit Disney+ compared to VOD, per Samba TV. Small-budget prestige film The Brutalist saw seven times more viewership on Max vs VOD in its first weekends (while still struggling overall). The dominant viewer preference was to watch these titles when they became “free” on streaming rather than fork over a fee, which speaks volumes about how audiences valued each.
Amazon’s Christmas action movie Red One similarly disappointed in theatrical box office but The Quorum’s pre-release tracking pointed to growing interest in home viewing, despite weak theatrical demand. That data supported its short theatrical window and helped anticipate performance beyond box office. It ultimately became the 10th most-viewed film on streaming for all of 2024, despite only debuting on Amazon Prime Video on December 12. Highly impressive.
Not every film needs to break box office records to deliver value. But, ideally, every film needs to go through a rigorous pre-release testing ground to identify the best distribution fit. Theatrical and at-home releases should be viewed as two sides of the same coin for a studio’s benefit. This can make the difference between the glowing perception of a hit or the harsh reality of a flop. All of these inputs help to determine and explain why some movies go to theaters and others are made available at-home. In today’s attention economy, where a film releases has become just as important as the who, what and when.
(Except for the headline, this story has not been edited by PostX News and is published from a syndicated feed.)
