Cracking the Code: Inside the Intricate World of Content Licensing Deals and Slate Programming

As streaming platforms vie to capture marketshare in a view-from-home environment, the recent deal between A24 and Warner Bros. Discovery (WBD) brings A24’s eclectic catalog exclusively to HBO and Max after their theatrical runs illustrating the need for studios to look elsewhere for interesting films.

In the past, A24 films found their initial home on Showtime. However, the expiration of another content deal with Apple TV+ for original streaming films created a fresh all-in-one prospect that A24 couldn’t ignore.

The deal underscores the escalating competition in the streaming space and the pivotal role of content acquisitions in attracting and retaining subscribers. The deal also paves the way for Max to expand its catalog after significant losses.

Content Licensing Dynamics: A Complex Interplay of Slate Programming

The intricate interplay of content licensing has become increasingly complex, with streaming giants like Max, Paramount+, and Disney+ maneuvering to secure lucrative deals with independent production studios.

The latest major industry output deal is between A24 and WBD, structured as a Pay-1 output deal. After finishing their theatrical run, all A24 films will be available exclusively on platforms owned by WBD, including HBO, Max, and Cinemax, for a predetermined period. Altogether, the agreement will deliver over 100 films to WBD throughout the term, thought to be three years.

A24 previously had a comparable Pay-1 deal with Showtime, signed in 2019, but it has since lapsed. Likewise, in 2018, Apple TV+ partnered with A24 on a multiyear agreement to produce a slate of original films for the tech giant. Both of which failed to raise the profile of A24.

A24’s departure from its previous deal with Showtime signifies a strategic realignment, as the independent distributor seeks to capitalize on HBO and Max’s broader reach and subscriber base. Paramount’s recent struggles highlight the challenges of balancing content costs with revenue generation as platforms navigate the delicate balance between offering compelling content and managing costs.

The financial terms of the A24 and WBD deal remain undisclosed, but its significance for both parties is undeniable. For A24, aligning with HBO and Max provides access to a larger audience and potentially higher revenues, while for WBD enhancing the prestige and appeal of its streaming platform.

The steadfastness displayed by A24 is remarkable, especially considering the company’s near sale in 2021 when it was valued at $3 billion. Instead of pursuing that path, the distributor opted for a $225 million equity investment, demonstrating a commitment to its vision and strategic objectives.

Content valuation has never been more critical, with streaming platforms investing billions in original programming and licensing agreements to stay competitive in a crowded market.

Uncover What Streamers Like Max, Paramount+, Amazon, and Netflix Pay to License Films and Shows Worldwide with Exclusive Distribution Intelligence from FilmTake.

Worldwide Film & Television Distribution Intelligence

Get unparalleled access to market intelligence reports that draw on financial data and insights from dozens of content distribution deals worldwide between key industry participants.

Film and Series distribution rates and terms deriving from dozens of agreements for rights to transmit films and episodic television via PayTV and SVOD.

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Licensing Terms & Included Programs:

Pay-1 & SVOD Rate Cards for Motion Pictures and Series Exhibited Worldwide in Multiple Availability Windows

  • Motion Pictures: Pay-1, First Run, Second Window Features, Recent Library Features (Tiers AAA,A,B,C), Library Features (Tiers AAA,A,B,C), Current and Premium Made-For-TV Films and Direct-To-Video Films, covering many license periods over the last decade
  • Episodic TV: Current, Premium, Premium Catalog (1HR & 1/2HR), Catalog Series (1HR & 1/2HR), and Catalog Miniseries + Case Studies on Current Mega Hit, Catalog Mega Hit, and Premium Catalog, covering many licensing terms from 2012-2024
  • Because most-favored-nation rates operate in practice, the rates and terms apply to a diverse range of content and distributors worldwide in multiple availability windows.

The Rise of Indie Distributors and Niche Content

The prominence of indie distributors like A24 and Neon highlights the growing demand for diverse and eclectic content in the streaming era. While larger studios dominate the blockbuster landscape, independent films uniquely appeal to audiences seeking authentic storytelling and artistic innovation.

A24’s primary competitor in the independent distribution space is Neon, whose films predominantly stream on Hulu through a 2017 distribution agreement.

Integrating independent films into mainstream streaming platforms like Hulu and Max signifies a broader shift towards looking outside the studio system for films to attract and retain subscribers.

A Confounding Array of Content Licensing Agreements

In 2022, Disney consolidated its theatrical releases from 20th Century Fox and Searchlight exclusively onto Disney+ rather than sharing them with Hulu. This move coincided with Disney’s acquisition of Comcast’s stake in Hulu and its subsequent integration of Hulu’s content into Disney+.

Across various streaming platforms, Pay-1 arrangements reveal a reliance on external theatrical slates to attract and retain subscribers. Established platforms like Netflix source studio films from Sony Pictures and prestige titles from Sony Pictures Classics as their originals fall to gain any traction.

Prime Video offers rotating selections of Universal and Paramount titles and Amazon’s MGM films post-MGM+ release. Disney’s streaming services eventually include Sony titles, and Hulu became the streaming destination for art-house distributor Neon’s films after their theatrical releases.

However, this approach has drawbacks, creating confusion and gaps in streaming libraries despite offsetting some losses associated with SVOD through licensing agreements. For instance, Universal secured an additional deal with Lionsgate to stream its films on Peacock after their runs on Starz due to the complex distribution arrangements that scatter Universal Pictures and Focus Features films across various platforms.

Major Content Licensing Deals in the U.S. (Updated)

Film StudioFilm SlatePay-One WindowPay-Two Window, etc.
Disney20th Century Fox /
Disney+ / Hulu /
HBO / Max
A24A24HBO / Max / CinemaxN/A
LionsgateLionsgate FilmsStarzN/A
MGMMGMMGM+Amazon / Paramount+
SonySony PicturesNetflixAll Disney Platforms
UniversalAnimated FilmsPeacock / NetflixNetflix
UniversalLive-Action FilmsPeacock / AmazonStarz
Warner Bros.Warner Bros.HBO / MaxN/A

FilmTake Away: As Studios Stumble the Door Remains Open for Independent Distributors

These output agreements are more important than ever as audiences increasingly avoid theaters, a trend that seems impossible to reverse. The average theatrical window in the United States has shrunk to a mere 35 days after maintaining a 90-day window before widespread lockdowns. However, a few films have managed to buck this trend, including “Oppenheimer,” which lasted 122 days in theaters.