Wall Street analysts say Netflix will spend more than all studios except Disney making movies this year. But its theatrical strategy is a huge question mark.

• Barclays analysts released a report this week on Netflix estimating the streaming giant could spend $2.5 billion to $3 billion on its original movies this year.
• Netflix plans to release 90 movies this year.
• But to compete going forward, Barclays analysts argued that Netflix needs to release more of its movies theatrically.
• Box-office analyst Jeff Bock told Business Insider he disagreed, and said he believes Netflix is doing fine owning the streaming space.

If you think Netflix has been churning out a lot of movies, just wait and see what the count will be by the end of 2019.

According to a Barclays report released this week, the streaming giant plans to release 90 movies this year (55 big budget movies and 35 documentaries) and based on the average budgets for the genres Netflix targets, Barclays projected Netflix could spend $2.5 billion to $3 billion to make them.

"This would make Netflix's output budget second only to Disney and bigger than every other Hollywood studio," the report said, also pointing out Netflix would have the biggest pipeline in the movie business.

To put that in context, in 2018 Warner Bros. released 49 movies, Sony released 28, Universal 23, Fox 17, Disney 13, and Paramount 12.

Barclays said that while Netflix hopes the movies will help add more subscribers to its service in the near term, the massive outpouring of content is also part of Netflix's preparation for a future in which studios will stop licensing movies to it.

With Disney's streaming service, Disney+, set to launch this year, and others to follow (WarnerMedia's, for instance), competition for movie catalog rights will be fierce.

The big question as 2019 begins is how Netflix will tackle theatrical distribution for movies, as the company's strategy seems to be in flux.

2018 marked the first time Netflix gave some of its movies exclusive theatrical releases before they were available to stream. It gave exclusive runs to "The Ballad of Buster Scruggs," "Bird Box," and "Roma" (though Netflix didn't release their box-office grosses). The biggest motivating factor behind the change in policy was giving Alfonso Cuarón's "Roma" a real shot at the Oscars.

But the Barclays analysts argued that to compete with big studios like Disney going forward, Netflix should release more of its original movies theatrically.

"We believe the nature of film as a product/experience is difference enough to television content that it requires a distribution strategy that is more tailored to the medium," the report said.

The report noted that audiences still equate a lack of quality to movies that are not released theatrically. And then there's the longterm life of a movie title. The report made the case that even though Netflix's Will Smith movie, "Bright," had blockbuster-level production value, a year later the interest in the movie, according to Google Trends, isn't close to that of theatrically released titles that came out around the same time like "Jumanji: Welcome to the Jungle" or even the smaller-budgeted "Three Billboards Outside Ebbing, Missouri."

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"Releasing a film only on Netflix not only reduces the economic returns for Netflix but also changes the preception of the quality of content on the service," the analysts said.

But one box-office analyst Business Insider spoke to didn't agree.

Jeff Bock, senior box-office analyst at Exhibitor Relations, said Netflix giving theatrical releases to its own big releases could "possibly" help it compete with Disney blockbusters, but he sees the streaming giant continuing its game plan of getting legends - Will Smith, Brad Pitt, Sandra Bullock (who was the star of "Bird Box"), Joel and Ethan Coen (who made "Buster Scruggs"), Alfonso Cuarón, and Martin Scorsese (Netflix is releasing his upcoming movie "The Irishman") - to bring their passion projects to Netflix as a counter to what Disney is doing.

"Netflix has the best of the best working for them, and they offer little-to-no interference, can a studio offer that these days?" Bock said. "Netflix is the ruler of all things streaming."

And just recently, we learned that Netflix can grab the popular culture as much as a big studio release can.

"Bird Box" didn't just become a popular meme, it was seen by 26 million US viewers in its first week, according to Nielsen (Netflix announced 45 million accounts worldwide viewed the movie in its first seven days, a record for the company). It's highly unlikely the blink-and-you-missed-it theatrical release of the movie helped generate buzz for its eventual huge streaming launch.

Netflix declined to comment for this story.