Streamers’ poor decisions have seemingly saved movie theaters
Streamers’ poor decisions have seemingly saved movie theaters
The 2026 summer box office has hit $4 billion for just the second time since COVID this year. Rising streaming costs and the spread of ads have played a part.
Streaming services had their chance to kill movie theaters once and for all. When the world shut down during the onset of the COVID-19 pandemic in 2020, movie theaters were one of the hardest-hit businesses. In 2019, the global box office reached an all-time record of $42.5 billion, boosted by hits like “Avengers: Endgame,” “Spider-Man: Far From Home,” and “Joker.” In 2020, it plummeted to under $12.5 billion.
The theater industry has taken years to recover, but in 2026, things are looking bright indeed. Box office revenue from May to early August has officially surpassed $4 billion, thanks to titles like “The Odyssey,” “Spider-Man: Brand New Day”, and “Toy Story 5” — the second time summer receipts have reached that number since the pandemic. The data not only makes it clear that streamers missed their chance to put the final nail in the movie theater industry’s coffin, but also raises the question of whether streamers have actively contributed to the revival of movie theaters. After an examination of the evidence, it seems quite clear that rising prices, lengthening theatrical windows, and the spread of streaming ads have made viewers far more willing to return to the cinema than streaming execs likely ever wanted.
When the COVID pandemic gripped the nation, studios were very open to experimenting with using their streaming services as the main exhibition platform for their already planned theatrical slates. Warner Bros. took things the furthest, committing to day-and-date releases on HBO Max for all of its planned theatrical releases in 2020 and 2021. Disney+ took a hybrid approach, offering premier access to several films by allowing viewers to pay $30 to stream them at home on the same day that they were released in theaters.
Warner Bros. was rewarded with tens of millions of new HBO Max subscribers as a result of what it called “Project Popcorn.” But the decision to make its entire 2021 slate available immediately infuriated filmmakers; “The Odyssey” director Christopher Nolan left the studio over the decision, and by the end of the year, it became clear that streamers had missed their chance to take over as the main distributor for their movies. The margin of error was tiny; the pandemic window only allowed a limited time for figuring out how to make brand-new releases pay on streaming services, and no studio cracked the code before COVID concerns began to wane.
By 2022, studios had begun shifting back to a theatrical-first model for their movies. Their parent companies realized that priorities around streamers were shifting; streaming would soon have to prove itself a profitable business, not just a loss leader that brought new customers into a media firm’s tent with cheap content. That recognition led to streaming prices that began an unabated upward ascent, as well as the launch of ad-supported tiers from Netflix, Disney+, and others.
The recent rash of price increases for major streaming services hasn’t exactly been modest, either. An ad-free HBO Max plan cost $15 per month in 2021, when viewers were able to stream all Warner Bros. theatrical titles the day they were released in theaters. Now, the streamer’s cheapest ad-free plan is $18.49, a nearly 20% increase, with its top plan now $23 monthly, a 35% jump. Disney+ has experienced an even larger price jump in the same span of time, rising from $8 per month for an ad-free plan to $19 per month in 2026, a 58% increase during the time span. Disney’s price hikes are due to both modern entertainment economics and the strategic desire to drive viewers to higher-value bundle plans, even though those prices are usually only $1 or $2 more and include at least one extra streamer. However, all major on-demand streamers have raised their prices by at least 20% to 30% since the pandemic.
TBD
Every top streaming service in the United States other than Apple TV now offers an ad-supported tier. The launch of such plans is usually intended to offer a carrot to counterbalance the stick of higher prices; ad plans are usually $3 to $5 per month cheaper than ad-free tiers, and still offer fewer ads per hour than traditional TV once did. But HBO Max and other streaming services have increased their ad loads to boost revenue further, and without a massive cancelation reaction thus far, there’s no incentive for other streamers not to follow suit.
As execs waited for these tactics to lead to higher revenues, companies like Disney, Paramount, and WBD also began extending theatrical windows. COVID was a quick lesson to studios that movies make essentially no money on streaming, especially compared to box-office revenue. Companies quickly began relying on this revenue again to keep the lights on as their streamers struggled and their linear networks shed thousands of viewers each quarter.
High prices and a large number of ads can tank a streamer's perceived value, and longer theatrical windows, higher streaming prices, and the increased ad loads have seemingly had a profound effect on the behavior of streaming customers. It hasn’t turned people off streaming completely, as it is now essentially the predominant form of television, but there are a growing number of viewers — especially young viewers — who no longer think of streaming as such a good value that they can simply skip movies while in theaters.
Data released by the National Research Group and Cinema United in December showed that Gen Z viewers averaged 6.1 visits to the theater each year, up from 4.9 visits year-over-year. Premium screen formats and deluxe seating rank highly as reasons for these visits, but Gen Z audiences are also highly value-conscious when it comes to their video entertainment. They aren’t going to pay premium prices for ad-supported content, which is the proposition streamers are more and more often pushing viewers to accept as they seek wider profit margins.
While all viewers are returning to the cinema, Gen Alpha is even more taken with the theatrical experience. NRG’s data found that 59% of Gen Alpha respondents say that they prefer going to the theater to see a movie to watching at home. Though younger viewers might be seen as the least likely to adopt seemingly antiquated formats for watching films, it’s important to remember that streaming was never a novelty for these generations. They came into a world in which watching a movie via streaming at home was not only easy, but the norm. Going to the theater, by contrast, is an experience, a way to turn a simple viewing into an event.
The major changes that have taken place industry-wide over the past five years are not the only factors leading to this year’s box-office boom. But rising streaming prices, increasing ad loads, and longer theatrical windows have all played a part in shattering the illusion that streaming was on the precipice of shutting down movie theaters around the world.
HBO Max
HBO Max is a subscription video streaming service that gives access to the full HBO library and exclusive Max Originals. There are hubs for content from TLC, HGTV, Food Network, Discovery, TCM, Cartoon Network, Travel Channel, ID, and more. Watch hit series like “The Last of Us,” “House of the Dragon,” “Succession,” “Curb Your Enthusiasm,” and more. Within HBO Max, B/R Sports allows users to watch live NBA, MLB, NHL, March Madness, and NASCAR events.