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Scorsese’s New Mob Epic, ‘The Irishman,’ Has Netflix and Theaters at Odds

LOS ANGELES — When Martin Scorsese signed with Netflix to make “The Irishman,” the star-studded epic scheduled to have its premiere on the opening night of the New York Film Festival next month, he put himself in the crossfire of the so-called streaming wars.

The film, which may represent Mr. Scorsese’s grandest statement yet on the intersection of organized crime and American politics, is expected to be a strong contender in the 2020 Oscar race. He took his $159 million movie, with Robert De Niro in the lead role, to Netflix after his home studio of recent years, Paramount Pictures, balked at the budget.

The full extent of the theatrical rollout remains up in the air. Where, exactly, moviegoers will be able to see “The Irishman” won’t be clear until the discussions between Netflix and select major theater chains end. They have been dragging on for months. The negotiations are just the latest chapter in the conflict between the film industry’s old guard and the tech-driven upstarts.

“The Irishman,” a throwback to the 1990s Scorsese hits “Goodfellas” and “Casino,” was announced more than a decade ago at Paramount, the studio where he made “The Wolf of Wall Street” and “Silence.”

Mr. Scorsese struck the deal with Netflix in 2017, and filming started soon afterward. The film, which makes use of “de-aging” special effects to keep the actors looking the right ages in a saga that spans decades, is in the final stages of postproduction as the director works to get it done in time for its Sept. 27 festival premiere.

In his ninth collaboration with Mr. Scorsese, Mr. De Niro plays the title character, Frank Sheeran, a hit man known as the Irishman who claimed he killed the Teamsters boss Jimmy Hoffa, whose body has never been found, in 1975. He is joined in the cast by the “Goodfellas” and “Casino” alumnus Joe Pesci, who came out of retirement to play the mob boss Russell Bufalino. Al Pacino — appearing for the first time in a film directed by Mr. Scorsese — portrays Hoffa.

Scott Stuber, the head of Netflix’s film division, is leading talks for the streaming company with at least two large chains, AMC Theatres, which operates 11,000 screens worldwide, and Cineplex, the largest exhibitor in Canada, with over 1,600 screens, according to two people familiar with negotiations. Ted Sarandos, Netflix’s chief content officer and Mr. Stuber’s boss, has also taken part in the talks. The director has been pushing for a robust national theatrical release, two people with knowledge of Mr. Scorsese’s thinking said.

ImageCreditVictoria Will/Invision, via Associated Press

Two other large chains, Regal and Cinemark, told The New York Times that they were not in discussions with Netflix over “The Irishman.”

Adam Aron, the AMC chief executive, said in a statement, “Talks are underway with Netflix about our showing ‘The Irishman’ and other Netflix films, but the outcome of those conversations is not yet clear.”

AMC and Cineplex are negotiating with Netflix separately, the people familiar with the talks said. A crucial sticking point has been the major chains’ insistence that the films they book must play in their theaters for close to three months while not being made available for streaming at the same time, which does not sit well with Netflix. Talks broke down in July, only to pick up again two weeks ago, the people said.

Netflix, Mr. Scorsese and Cineplex declined to comment for this article.

Because of the impasse over the three-month theatrical window, Netflix has yet to give any of its films the kind of blockbuster theatrical releases that companies like AMC can provide. The streaming giant’s reluctance to concern itself with weekend box-office numbers reflects its laser focus on its main mission: delivering streaming video on demand to its 151 million subscribers worldwide.

Having built itself into an entertainment powerhouse by keeping its subscribers interested and coming back for more, the company does not want to be distracted by the demands of the old-style movie business, even as it makes deals with legendary filmmakers like Mr. Scorsese.

“Netflix is in the subscriber happiness business,” said Richard Greenfield, a tech and media analyst. “They need to attract more members and make current members happier. ‘The Irishman’ is really important.”

Many Netflix movies, like the Adam Sandler vehicle “Murder Mystery,” which Netflix said had 78 million household views in its first four weeks, seem made for living-room viewing. But Netflix has also come out with more ambitious offerings, like “Roma,” the meditative black-and-white film from the director Alfonso Cuarón. “Roma” won praise from critics on its way to three Oscars this year, for best director, best cinematography and best foreign language film.

As Netflix’s movie division has matured, the company has softened its stance on theatrical distribution. Last year, it struck deals with independent movie houses and small theatrical chains like Landmark and Alamo Drafthouse, which have looser requirements than the big exhibitors on exclusive showings, for one-week runs of the Sandra Bullock thriller “Bird Box” and the Coen brothers’ western “The Ballad of Buster Scruggs” before they were made available for streaming.

ImageCreditHunter Kerhart for The New York Times

For “Roma,” Netflix went further, giving it a 21-day theatrical release at the independent and small-chain theaters before its subscribers could watch it on devices or TV screens. Netflix has said there will be some kind of theatrical release for “The Irishman,” but has so far resisted going much beyond the 21 days it granted “Roma,” the people familiar with the talks said.

When he agreed to make the film for Netflix, Mr. Scorsese was aware that a wide release was not guaranteed, but he chose the company because it was “actually making our movies, from a place of respect and love for cinema,” he said in an email to The Times last year.

The trailer for “The Irishman,” released last month, has racked up millions of YouTube views, suggesting that it has greater commercial potential than “Roma.” The potential box-office revenue could be a boon for a company that has bet big on a single revenue stream, despite calls from Wall Street to diversify. Netflix stock fell by 12 percent last month after it reported its first decline in domestic subscribers since 2011.

“While direct release of smaller budget films on Netflix makes economic sense, we believe franchise-oriented films will need to include theatrical release on a large scale to optimize returns,” the financial services company Barclays said in a January report.

The coming Scorsese film also has a shot at the prize that eluded “Roma” despite Netflix’s costly awards campaign on its behalf: the Academy Award for best picture.

Oscar eligibility is not much of a factor in how Netflix handles the rollout. To qualify for the Academy Awards, a film must have a seven-day run in a commercial theater in Los Angeles County, according to rules recently confirmed by the Academy of Motion Picture Arts and Sciences’ board of governors; it can even be shown on another platform at the same time. Still, there is an Academy contingent that may look askance at Netflix if it does not play by the old rules for a cinematic feature like “The Irishman.”

Despite its craving for Oscar gold, Netflix does not want to be distracted from its core business — especially now that it will be challenged by the Walt Disney Company, which plans to unveil its Disney Plus streaming service Nov. 12, and Apple, which is starting its equivalent, Apple TV Plus, on an unspecified date this fall. Following those giants into the increasingly crowded digital-video marketplace will be WarnerMedia and Comcast, among others.

In an effort to stay ahead of its current and future rivals, Netflix spent $12 billion on original content in 2018. While the company has paid large sums to star television producers like Ryan Murphy, Shonda Rhimes and the “Game of Thrones” duo David Benioff and D.B. Weiss, it has not stinted on its movie division, which made 55 films last year, not counting documentaries and animated movies, and has brought aboard A-list directors like Noah Baumbach, Ron Howard, Dee Rees, Steven Soderbergh and Guillermo del Toro.

ImageCreditDia Dipasupil/Getty Images

Even as it works to add subscribers, Netflix cannot afford to alienate top filmmakers. Mr. Stuber is mindful that the way to keep the talent happy is to get their work on the big screen. He recently bolstered the Netflix film arm by hiring two distribution executives from 21st Century Fox, Spencer Klein and Pablo Rico.

AMC and other large chains worry that if they grant Netflix a shorter theatrical window, they will have to do the same for other studios. In his statement, Mr. Aron added that he would be “delighted” to show Netflix movies, but he had a caveat: “We can only do so, however, on terms that respect AMC’s important and close relationships with our longstanding studio partners, including Disney, Warner Brothers, Universal, Sony, Paramount, Lionsgate and so many other filmmakers who are the lifeblood of our substantial business.”

Some Hollywood executives have said the theater chains must adapt if the cinematic experience is going to compete with the convenience of streaming. “Both the studios and the exhibitors have to look at every aspect of how we do business together and figure out different paradigms to move it forward,” said Chris Aronson, the former chief distribution executive at Twentieth Century Fox.

More than 95 percent of movies stop earning their keep in theaters at the 42-day mark, well short of the three-month window demanded by major chains, according to Mr. Aronson. That suggests the need for change, he said.

“The movie theaters feel that if they blink at all, it will all blow up,” said Jeff Blake, the former chairman of worldwide marketing and distribution for Sony Pictures.

Netflix’s unwillingness to promise wide releases has come with a cost. The company lost out on the rights to “Crazy Rich Asians,” the 2018 romantic comedy that grossed nearly $240 million at worldwide box offices. The director, Jon M. Chu, and the author of the novel it was based on, Kevin Kwan, decided to go with Warner Bros., saying they wanted the movie to play in as many theaters as possible.

Netflix’s stance has also put it at odds with the theatrical chain Regal, which said in a statement to The Times: “Currently, we are not in any discussion with Netflix on ‘The Irishman’ nor on any other movie. Of course, if Netflix will decide to respect the industry business model and release the movie with a proper theatrical window, we will be more than happy to discuss the booking of the movie in Regal theaters.”

Mr. Scorsese directed another film for Netflix, “Rolling Thunder Revue: A Bob Dylan Story by Martin Scorsese,” a playful documentary released simultaneously in select theaters and on the streaming service in June, but he plans to make his next film, “Killers of the Flower Moon,” starring Leonardo DiCaprio, at Paramount.


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