Cannes Buyers Send Defiant Message: Who Needs Netflix?

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Netflix CEO Reed Hastings

On at least three occasions, the streamer lost out to distributors with much smaller wallets.

Cannes' showdown with Netflix initially looked like a matchup between David and Goliath.

The festival had stood up to the streaming giant, banning it from competition for debuting films on its platform without allowing them to screen in French theaters first. The enforcement pleased local exhibitors as well as some auteurs (including Christopher Nolan, who hailed Cannes as "the festival that cares most about cinema"). In response, the company pulled its titles from the festival altogether, and in addition, sources say it plotted to buy as many Cannes titles as possible, a not-so-subtle F-you to festival director Thierry Fremaux.

But a funny thing happened on the way to the Croisette: Sellers balked at Netflix's overtures. On at least three occasions, the streamer lost out to distributors with much smaller wallets: The opening-night drama starring Penelope Cruz and Javier Bardem, Everybody Knows, went to Focus; the Mads Mikkelsen starrer Arctic to Bleecker Street; and the Colombian drug trade drama Birds of Passage to The Orchard. Netflix wanted Birds so much — perhaps as companion programming to Narcos, its most successful series worldwide — that it made a low-seven-figure offer for the Spanish-language film. But no dice.

One top sales agent cites the streamer's desire to own worldwide rights as a deterrent. "You're giving up theatrical and every ancillary revenue for a just slightly better upfront fee," he adds. In contrast, Netflix landed last year's hottest Cannes acquisition, paying nearly $20 million for worldwide rights to Taika Waititi's stop-motion film Bubbles, about Michael Jackson's pet chimp.

The dealmakers for this year's splashiest pact, the $75 million-plus female-fronted spy pic 355, decided early against seriously entertaining a Netflix offer, holding out for a theatrical release. Universal beat other players that could offer that — namely Lionsgate and Donald Tang's upstart Global Road Entertainment — in a U.S. rights deal valued at $20 million (Huayi Brothers paid $20 million for China rights to the film, which stars Cruz, Jessica Chastain, Marion Cotillard, Fan Bingbing and Lupita Nyong'o). "We went this route because Jessica felt really good about how it worked for Molly's Game, and we all wanted as much creative control and sense of ownership as possible," says 355 director Simon Kinberg of why the film opted for the traditional presales approach.

As of press time, Netflix had made just one acquisition at Cannes 2018, plunking down $30 million for the animated pic Next Gen. Still, the film itself generated far less buzz given that the voice cast — headed by Charlyne Yi and Jason Sudeikis — is far less known than 355's fab five.

Ultimately, Netflix remains the most powerful buyer, but it picked a fight with the festival that only underscores the streamer's most glaring downside — that it doesn't offer a proper theatrical release. Says IFC Films/Sundance Selects CEO Jonathan Sehring, "There's no reason why Cannes should change for Netflix." 

This story first appeared in the May 16 issue of The Hollywood Reporter magazine. To receive the magazine, click here to subscribe.