Russia-Ukraine war: How media giants are cutting off Russia as crisis evolves
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Top media companies are responding to punitive actions against Russia as its assault on Ukraine continues.
Major studios, including Disney (DIS), Sony Pictures Entertainment (SONY) and Warner Bros. (T) have paused theatrical releases in the country, specifically citing the Russian invasion.
Meanwhile, Netflix (NFLX) is refusing to abide by a new law that would require the streamer to include 20 "free-to-air" Russian State TV channels, while DirectTV is pulling the Russian-government-controlled RT network from its service.
The moves underscore how many U.S. businesses are making quick decisions to limit operations in Russia as Western governments slap serious sanctions on Russian President Vladimir Putin and the country at large.
Here's a deeper dive at how major media companies are cutting off Russia, and siding with Ukraine.
Studios monitor 'evolving situation'
Pixar's "Turning Red," and Robert Pattison's much-anticipated "The Batman" are just two high-profile films that will not be available in Russia, despite their impending box office release dates.
On Monday, Disney was the first major Hollywood studio to make the decision, writing in part, "We will make future business decisions based on the evolving situation."
Warner Bros. quickly followed suit, revealing that "The Batman" will no longer debut in Russia on its intended theatrical date of March 3. The studio also said it will "continue to monitor the situation as it evolves."
Sony, which noted it "hope[s] this crisis will be resolved quickly," also decided to pause its film releases, including the upcoming Marvel adaptation, "Morbius," which is linked to the "Spider-Man" franchise.
This development isn't likely to move the needle in a significant way for most upcoming releases outside of Russia...Shawn Robbins, Box Office Pro Chief Analyst
Although Russia does not have the same "make or break" impact as China when it comes to global box office sales — China accounted for 34.6% of the worldwide box office last year — it still remains a significant driver for international markets.
According to Comscore data, Russia accounted for nearly $601 million in ticket sales in 2021 — about 2.8% of the total global box office haul of $21.4 billion.
In addition, Russia is a territory that ranks in the Top 10 countries by year, ranking 6th worldwide in 2021, 7th in 2020 and 9th in the pre-pandemic year of 2019.
As studios and theatrical exhibitions continue to climb back from COVID-era headwinds, experts agree that any theatrical delay is likely to come with financial risks — although Box Office Pro chief analyst Shawn Robbins revealed that the impact should be marginal.
"With complete respect to the tragic situation unfolding in that part of the world right now, there isn't an expectation of broader impact on studio release plans outside of Russia at this time," Robbins said.
"The real world fallout takes clear precedence, but speaking purely from a numbers perspective, 'Spider-Man: No Way Home' has earned less than 3 percent of its global gross" from Russia, he said.
"This development isn't likely to move the needle in a significant way for most upcoming releases outside of Russia, but it is an evolving subject," the analyst added.
Netflix has 'no plans' to follow new Russian law
According to a new Russian broadcast law, which took effect on March 1, any media platform that reaches more than 100,000 subscribers in the country will be required to include as many as 20 “free-to-air” Russian state TV channels.
Netflix — which would fit that subscriber requirement — refused to comply. In a statement to Yahoo Finance, the streaming giant said: "Given the current situation, we have no plans to add these channels to our service.”
These state-run media channels have been largely favorable to Putin's agenda, and spreading misinformation about the crisis in Ukraine. One of the channels in question is Channel One, which reportedly has close ties to the Kremlin. Another is Spas, which is operated by the Russian Orthodox Church.
Currently, despite Netflix not complying with this rule, the platform is still expected to continue to operate in the country. However, it is unclear at this time how it will skirt past and avoid the new regulation, especially if Russia decides to enforce it.
In terms of users, the streamer's presence in Russia is still relatively new. After launching in the country just over one year ago, estimates place Russia’s Netflix subscriber count at less than 1 million. For context, the company had 222 million global subscribers at the end of 2021.
Still, it is a region that the company is heavily focused on as it looks to aggressively expand its footprint overseas.
Alexandra is a Producer & Entertainment Correspondent at Yahoo Finance. Follow her on Twitter @alliecanal8193
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