Sony Entertainment CEO blames theaters for cancellation of The Interview, still wants to release the film
Frank Pallotta / CNNMoney.com :
Context & Ripple Effects
Sony's position has flipped twice in three days: after declaring on December 18 that it had no further release plans for The Interview, the studio now says the cancellation was the theaters' doing, not its own capitulation. That reframing sets up the next move — Sony Entertainment says it still wants the film out, and within days it lands a streaming deal with YouTube and books a limited Christmas-day theatrical run.
The stakes are whether a major studio can route around exhibitors entirely; the payoff arrives in January, when the film becomes Sony's top online title on roughly $31 million of streaming revenue.
First-order effects
- Sony shifts from shelving the film to distributing it directly through YouTube, Google Play, Xbox Video and SeeTheInterview.com, cutting theatrical intermediaries out of the transaction.
- Exhibitors that pulled showings lose their veto power over the release — Sony demonstrates a studio can blame them publicly and still get the movie to audiences.
Second-order effects
- Theaters' leverage over controversial releases weakens: if a studio can reach viewers digitally at rental pricing, exhibitors lose their role as the gatekeepers who determine whether a film opens at all.
- Other studios gain proof-of-demand data — a canceled theatrical wide opening converted into tens of millions of online revenue — strengthening the case for premium home-video windows on future titles.
Third-order effects
- If the pattern holds, the exclusive theatrical window stops being the default first run for mid-budget films, pushing studios toward day-and-date or digital-first strategies whenever exhibitor risk is high.
- Distribution platforms like YouTube move up the value chain from marketing channels to premiere venues, forcing regulators and industry contracts built around theatrical exclusivity to adapt.
The trend: Studios are discovering they can bypass the theatrical window when exhibitors balk, turning crisis releases into a template for direct-to-digital distribution.