Despite making $18M, don’t expect ‘The Interview’ to revolutionize digital movie distribution

At first glance, Sony’s “The Interview” had a good start in its improvised release schedule. But anyone who thinks this will lead to a new era in digital movie distribution is kidding themselves.

According to a Sony press release, about 2 million customers spent $15 million to download or watch the movie online. In addition, the movie has bagged $2.8 million playing in 331 movie theaters through Sunday. Of course, another 1.5 million people have downloaded the movie via torrent, from which Sony makes zilch.

If we were being generous, then, and counting all $18 million as the opening weekend, the movie would have been the fifth highest grossing movie of a big holiday weekend.

As Variety notes, the original plan called for the movie to be shown on about 3,000 screens starting on Christmas Day. Projections had it making $20 million by the end of its first weekend.

In general, then, given the chaos of the past week and Sony’s waffling about whether and how to release a movie that was allegedly the reason North Korean hackers targeted the company, $18 million is not bad.

While it seems like the movie will have a tough time making back its reported $75 million budget, Sony clearly has at least salvaged something from a financial perspective. Sony will get some additional help now that Apple’s iTunes has started selling the movie in the U.S. and Canada. Any kind of global distribution, however (other than illegal torrents, that is), seems like it will take a while.

Of course, Sony wants to spin this as a greater triumph than it is, noting the numbers make “The Interview” its biggest online hit ever. That’s not saying much.

In this case, the movie benefited from extraordinary publicity. By the time Christmas rolled around, it was safe to say just about everyone in the U.S. had heard something about the movie given that even President Obama felt compelled to weigh in on the drama surrounding its release. A typical release online would have an incredibly difficult time getting such attention or even much respect given that people tend to view movies that get VOD-first releases as a sign the movie is weak.

More than that, the actual amount of revenue generated is a meaningless measure. What matters is the underlying terms of the revenue deals that Sony struck with distributors like Google and Apple.

Obviously, sales through Sony’s website are likely lucrative for the company. But we don’t know the terms of the other deals, and without that information, it becomes impossible to draw any conclusions about the impact of the strategy. Given the rush to strike the deals, though, it’s hard to imagine Sony felt it had much leverage to maximize its split of any revenue.

In general, Sony would negotiate hard on such deals, knowing that it risks angering theater owners who expect to get such releases first and to have long windows before they are released on video. Sony still needs these theater owners to secure screens for its blockbuster releases.

For now, then, you can expect Sony and just about every other studio to keep doing business as they’ve always done and to keep fighting to keep things from changing too fast. The future of digital movie distribution will get here, eventually, but nothing that happened last week will accelerate the incremental pace of change