Netflix just got snubbed by the biggest film in Sundance history - here's why

Netflix and Amazon have been on a buying spree so far at this year's Sundance Film Festival.

But Sundance hasn't been a complete triumph for Netflix, which endured a high-profile snub on Tuesday when it lost out on Nate Parker's powerful slave revolt film, "The Birth of a Nation."

"The Birth of a Nation" scored a Sundance record when Fox Searchlight bought the distribution rights for $17.5 million.

Losing a bidding war for the most expensive film in Sundance history doesn't seem so bad for Netflix, but here's the catch: Netflix reportedly offered $20 million, and was turned down.

Why the snub?

Sources told the New York Times that Parker wanted the film to make a splash in theaters, and this might have led him to spurn the extra $2.5 million Netflix promised. The Hollywood Reporter claims Parker's team wanted a theatrical release that would rouse people to action.

"My responsibility to the project is to make sure to find a partner that is as passionate as we are about it socially, so if that meant we had to take less money, then those were conversations I was willing to have," Parker told The Hollywood Reporter.

Netflix reportedly held firm to its plan of a simultaneous streaming and theatrical release, as it did with its first high-profile film last year, "Beasts of No Nation." But while that film was eligible for the Oscars, it was ultimately shut out, and grossed less than $1 million at the box office, according to Time.

"Beasts of No Nation" still reached plenty of people, with more than 3 million views. Netflix's content chief, Ted Sarandos, said this was a "bigger audience than any specialty film could ever hope for in its first two weeks of release."

But Parker wanted more than that with "Birth Of A Nation."

The problem with Netflix was summed up best by Sian Heder, the director of "Tallulah," which Netflix scooped up at Sundance for around $5 million. He told the New York Times: "You always want your film to be shown on a big screen with perfect sound and the best projection, but that's not always the reality anymore. The way that people consume media is changing."

For now, a big-money distribution deal with Netflix is seen by many film makers as a compromise - not the fulfillment of a dream.