With major studios releasing new movies directly to streaming services, theaters are struggling to remain relevant to viewers. This contentious partnership has been brewing for years but the rise of the COVID-19 pandemic put it into overdrive.

Here's how movie theaters and streaming services are continually battling for your attention and what the future looks like for both.

How Movie Theaters Used to Ensure Ticket Sales

In the days of old, when a new movie was released by a major studio it would enjoy a specific window of time in theaters before it was released to the public for rent. Usually, this required a movie to play for 90 days before anyone at home could get a copy.

Movie theaters have fought long and hard to keep this 90-day window intact so they could make as much money off the movie as possible.

Before the COVID-19 pandemic, movie studios were already in talks with some larger theater chains to reduce the window for smaller budget films while increasing the window for larger budget blockbuster films.

After people stopped going out in public for long periods of time, the relationship between movie theaters, studios, and streaming services changed significantly.

How Streaming Has Changed the Movie Landscape

After the COVID-19 pandemic hit and theaters were forced to close their doors for months on end, streaming services saw record growth. Netflix alone closed 2020 with over 200 million subscribers.

Studios had to release their in-theater movies online so that viewers could safely see them, but also so that the studios could recoup as much money as possible.

When movie theaters were allowed to open with limited capacity, studios could reach more viewers and receive more revenue by working directly with streaming services. They started to offer same-day releases in both theaters and streaming services.

This major change in how movies are being released has discouraged moviegoers to get out into theaters. Instead, they enjoy a new movie from the comfort of their own couch with new and improved home entertainment setups.

Since then, large chains like AMC and Regal have both announced concerns on the long-term prospects of theaters remaining open, with a limited number of new movies to screen and few people willing to make the trek to the theaters.

The fast growth of streaming services has led to a bigger investment in their own original releases. Now, Netflix can invest in its own movie releases at rates major studios could only have dreamed of.

Smaller theaters have taken the brunt of the swift change in how moviegoers are consuming their entertainment. Without large budgets or savings to rest on, many have been forced to close their doors for good.

This trend has been seen across the world, even in places where cases of coronavirus have lowered like China and New Zealand. The revenue generated from these theaters isn't nearly enough to keep the industry afloat.

Where Is the Movie Industry Heading?

With attendance at all-time lows in theaters, the larger chains have been forced to negotiate deals that favor studios and streaming services to stay afloat.

For Universal and AMC, a deal has been struck to reduce the normal 90-day theater to home distribution window. Now it's just 17 days. Similar deals have also been struck with Cinemark and Cineplex.

This isn't what theaters were hoping for as a recovery from the COVID-19 pandemic, but at this time it's the best they are going to get.

Another change that is possibly on the horizon is for theaters to start negotiating directly with streaming services, instead of with major studios. Because streaming services now have the budget to create and release their own material, theaters can negotiate to display their content.

This could breed a new kind of theater where a major player like Amazon could utilize part of the theater's floor space to promote their own products while they release their movies. Again, not exactly what the theater was hoping for, but at least it might keep the doors open.

Here's Looking at You, Theaters

No one can deny the major effects streaming services are having in the movie industry. Now that studios are starting to have major releases go straight to streaming, theaters need to renegotiate decade-old deals to stay alive.

In the meantime, at least you can enjoy streaming movies for free from the comfort of home.