Peso weakens sharply on threat of widening US-Iran tensions

January 3, 2020 | 6:24 pm

THE PESO weakened sharply past the P51-to-the-dollar level following a rush to safe-haven currencies due to the prospect of fresh Middle Eastern tensions after a US air strike killed a senior Iranian military officer while he was in Iraq.

The peso closed at P51.09 Friday, much weaker than its P50.685 close on Thursday, according to data from the Bankers Association of the Philippines.

Week-on-week, the peso weakened by 45.5 centavos against its P50.635 close on Dec. 27.

The peso opened the session at P50.65, which was also the high.

Dollar volume rose to $1.598 billion from $944.55 million previously.

A trader and a bank analystr said that the peso’s plunge Friday came on the back of fears of further Middle Eastern tensions.

“The peso weakened significantly due to safe-haven demand on reports that the United States was primarily responsible for the death of an Iranian military official,” the trader said in an email.

“This trend and significant decline points to the unfolding geopolitical risk. The market moved towards safe havens as much is still being digested in this new year,” Union Bank of the Philippines, Inc. Chief Economist Ruben Carlo O. Asuncion said in a text message.

Reuters reported that Iranian major-general Qassem Soleimani died on Friday following a US airs trike on his convoy at Baghdad airport.

The Pentagon said the strike was aimed at deterring future Iranian activity in Iraq.

Mr. Soleimani, commander of the Quds Force of Iran’s Revolutionary Guards, has helped Iran fight proxy wars across the Middle East. He died alongside Iraqi militia commander Abu Mahdi al-Muhandis. — Luz Wendy T. Noble

Local stocks post year’s first rise

January 3, 2020 | 6:23 pm

By Denise A. Valdez, Reporter

THE Philippines’ main index showed its first climb after three days on Friday as investors took cues on the mild improvement in the Philippines’ factory output for December.

The 30-member Philippine Stock Exchange index (PSEi) gained 97.26 points or 1.26% to close at 7,839.79, while the broader all shares index added 36.79 points or 0.80% to 4,655.54.

Darren T. Pangan, trader at Timson Securities, Inc., said the gains in the market were fueled by “positive reports regarding our IHS Markit Philippines Manufacturing PMI (purchasing managers’ index),” which came out on Thursday.

IHS Markit reported factory activity in the Philippines in December improved to 51.7 from 51.4 in the earlier month, driven by growing demand and higher exports. This may have drawn investors to local shares despite Friday’s generally thin trading, Mr. Pangan said.

Aside from the manufacturing report’s impact, optimism on the decision of China’s central bank to cut its reserve ratio requirement may have also affected the local bourse on Friday, Mr. Pangan said.

“Most global markets’ rally yesterday (Thursday) due to China’s reduction of their banks’ reserve cash requirements may have spilled some positive sentiment into our market today as we experienced profit-taking the day before,” he said.

Wall Street was a party at the maiden day of trading for 2020: the Dow Jones Industrial Average, the S&P 500 and the Nasdaq Composite indices all grew 1.16%, 0.84% and 1.33%, respectively.

In the Asia-Pacific region, trading on Friday was mixed: Japan’s Nikkei 225 and Topix indices shaved 0.76% and 0.68%, respectively, joining Hong Kong’s Hang Seng index in shedding 0.32%. But advancers were Australia’s S&P/ASX 200 index, which added 0.64% and South Korea’s Kospi index, which inched up 0.06%.

Back home, all subsectors ended in green territory, led by industrial, which jumped 196.67 points or 2.07% to 9,684.14 and holding firms, which gained 114.19 points or 1.52% to 7,631.72.

Property increased 28.55 points or 0.69% to 4,173.67, followed by services, which added 12.97 points or 0.85% to 1,547.27. Financials grew 12.47 points or 0.68% to 1,844.48 and mining and oil climbed 10.80 points or 0.14% to 8,020.76.

Some 659.2 million issues worth P5.6 billion were traded on Friday, or lower than Thursday’s 945.64 million issues worth P4.48 billion.

Stocks that advanced outnumbered those that declined, 108 against 68, as 59 names ended unchanged.

Foreign investors remained sellers, but net foreign selling was trimmed to P157.87 million on Friday from Thursday’s P852.24 million.

NCR point person of local terrorist group arrested

January 3, 2020 | 1:01 am

THE SUSPECTED gunrunner arrested in Quezon City on January 1 is the point person of the Dawlah Islamiya terrorist group in Metro Manila, according to the police chief. Philippine National Police officer-in-charge Lt. Gen. Archie Francisco F. Gamboa on Thursday said their background investigation revealed that the suspect, Datu Omar Palty, is a member of the terrorist organization under the faction of Esmael Abdulmalik, also known as Turaife ad Turaypi. Mr. Palty was previously a member of the Bangsamoro Islamic Freedom Fighters, a breakaway group from the Moro Islamic Liberation Front that has signed a peace deal with the government. “Palty was appointed by alias Turaypi as the point man or contact person of his group in Metro Manila,” Mr. Gamboa said in a press briefing at Camp Crame. As point person, Mr. Palty was tasked to coordinate with Dawlah Islamiya operatives from the provinces of Sulu and Basilan. He was collared during an entrapment operation in Barangay North Fairview, where he sold a loaded .45-caliber handgun for P10,000 to an undercover police officer. A fragmentation grenade was also recovered from him. Mr. Gamboa said Mr. Palty is suspected to have been involved in a several atrocities, including an attack on a military camp in Midsayap, Cotabato in 2009 where two soldiers were killed. Intelligence reports also implicated Mr. Palty in the killing of a couple and a security guard in San Simon, Pampanga in 2015. There is no indication that Mr. Palty was plotting a terror attack in Metro Manila when he was arrested, according to Mr. Gamboa. He added that the suspected terror group member was just in hiding. — Emmanuel Tupas, PHILSTAR

Nation at a Glance — (01/03/20)

January 3, 2020 | 1:00 am

News stories from across the nation. Visit www.bworldonline.com (section: The Nation) to read more national and regional news from the Philippines.

Factory activity improves slightly in Dec.

January 3, 2020 | 12:33 am

FACTORY ACTIVITY in the country improved modestly in December, driven by growing demand and higher exports, but production slowed to a two-year low, dragged by supply shortages and traffic issues, IHS Markit’s latest survey showed.

According to a report released on Thursday, the IHS Markit Philippines Manufacturing Purchasing Managers’ Index (PMI) reading inched up to 51.7 in December last year from 51.4 in November, its highest reading since October’s 52.1 and “in line with the average seen for the year (2019).”

Region-wide, the country continued to have the second-highest reading for the fifth straight month among the seven Association of Southeast Asian Nations (ASEAN) members covered by the survey, behind Myanmar’s PMI of 52 and outpacing Vietnam’s 50.8.

The Philippines continued to do better than the region’s average PMI of 49.8 last month — which improved from the 49.2 reading in November — indicating “consecutive deterioration in the health of the ASEAN manufacturing sector” for seven months in a row.

The headline PMI measures manufacturing conditions through the weighted average of five indices: new orders (30%), output (25%), employment (20%), suppliers’ delivery times (15%) and stocks of purchases (10%). A reading above the 50 level denotes improvement in operating conditions compared to the preceding month while below that signals deterioration.

“The improvement was partly driven by a solid rise in new orders received by Filipino manufacturers, with the rate of growth strengthening slightly from November,” the statement read.

Along with a “broad-based” increase in sales that month, it noted firms pointed to a slight uptick in new work from foreign clients which marked the second monthly increase in seven months.

However, stronger sales in December were offset by the marginal growth in production which stood at a “27-month low” or since September 2017, which some companies attributed “to delays in input deliveries and difficulties in sourcing raw materials curtailed production.”

According to firms surveyed, these delays were mainly due to heavy traffic affecting delivery time of suppliers as well as typhoons and congestion at the Manila port.

“Most notably for manufacturers though are clear supply-side issues that are restricting output. Growing road and port congestion, particularly in Manila, remain a key feature of businesses’ concerns,” said David Owen, economist at IHS Markit.

“Weaker output growth meant that businesses were less optimistic toward the outlook for production over the coming year,” the report said, adding that the level of positivity observed that month was “one of the weakest in the series’ history.”

Despite waning optimism, businesses still expect output to expand for this year on the back of strong sales growth and the state’s infrastructure projects.

“The government has announced its ‘Build, Build, Build’ program to address the problem which some firms are hopeful will reduce supply chain blockages. Nevertheless, for the moment, production is being limited, and may remain so until these issues have been addressed,” Mr. Owen added.

Meanwhile, employment in the goods sector posted a slight increase at the end of 2019 on the back of higher new orders.

“Backlogs of work meanwhile decreased further, as whilst deliveries of inputs slowed, firms saw little impact on the delivery of finished goods,” according to the report.

Input buying also increased in December but growth was at its “softest in ten months, and only modest,” which helped manufacturers expand their stocks of pre- and post-production goods.

Overall input price inflation eased as demand for inputs softened, while prices for some raw materials increased due to lack of supply.

In turn, the report said “average charges set by Filipino manufacturers were raised” modestly which can be traced to “the mark-up to higher demand for goods and greater cost burdens.” — Beatrice M. Laforga

Manufacturing purchasing managers’ index of select ASEAN economies, December (2019)

January 3, 2020 | 12:33 am

Ampatuans appeal guilty verdict in 2009 massacre

January 3, 2020 | 12:33 am

Murder convict Anwar Ampatuan Sr. and his two sons appealed the guilty verdict against them by a Quezon City court in connection with the massacre of 57 people in Maguindanao province a decade ago.

Anwar Sr., brother of convicts Andal Jr. and Zaldy, argued in his motion for reconsideration that mere knowledge and agreement in the massacre was not enough to establish a conspiracy. He also claimed he was not at the crime scene.

The trial court earlier convicted him, his two sons and his brothers Andal Jr. and Zaldy — former Maguindanao mayor and ex-governor of the Autonomous Region in Muslim Mindanao, respectively — and 23 others for the 2009 massacre.

More than a dozen more people were convicted as accessories to the crime. Their other brother, Datu Sajid Islam Ampatuan, was acquitted along with more than 50 others.

In a separate motion, his sons Datu Anwar “Ipi” Ampatuan, Jr., Datu Anwar Sajid “Ulo” Ampatuan, said the court had relied only on the testimony of a witness who claimed to have seen them with family members during a clan meeting. The testimony was later retracted, they said.

The massacre took place when family members and the media were accompanying Esmael G. Mangudadatu to the Commission on Elections to file his certificate of candidacy on Nov. 23, 2009. Mr. Mangudadatu was then running for governor of the Mindanao autonomous region to end the 20-year rule of the Ampatuan family..

More than 50 people were murdered, including 32 journalists. New-York based Committee to Protect Journalists called the attack the “worst single incident of journalist killing.”

Judge Judge Jocelyn A. Solis-Reyes said the prosecution proved beyond reasonable doubt that the murders had been planned. — Vann Marlo M. Villegas

12 multibillion-peso projects up for NEDA board review this month

January 3, 2020 | 12:32 am

GOVERNMENT economic managers are expected to go over 12 projects worth P652 billion this month as part of a plan to build growth centers in the countryside and expand development opportunities nationwide.

The board of the National Economic and Development Authority (NEDA) headed by President Rodrigo R. Duterte will review the projects, which include the extension of an elevated rail near the capital worth P49 billion, for approval in two weeks, Socioeconomic Planning Secretary Ernesto M. Pernia said in a mobile-phone message on Thursday.

“The approval of these projects is a pivotal step in fulfilling our thrust of fostering growth centers in the regions and expanding access to development opportunities throughout the country,” Mr. Pernia said in a separate statement.

The projects were approved at the Cabinet level of the NEDA Investment Coordination Committee last month.

Ten of the projects will cost about P557.4 billion. The two remaining projects are unsolicited proposals for the construction of international airports in Davao and Misamis Oriental, which cost P48.97 billion and P45.75 billion, respectively.

Among the 10 is the P49-billion Metro Rail Transit Line 4 (MRT-4) project, which is expected to cut travel time between Metro Manila and Rizal province.

The 15.56-kilometer elevated monorail transit system will start at the N. Domingo Station in Quezon City and end at the Taytay Diversion Road-Manila East Road rotunda in Taytay, Rizal. It will run through Ortigas Avenue, Ortigas Avenue Extension and Taytay Diversion Road.

Also included is the P8.51-billion EDSA Greenways project under the Department of Transportation, which involves building covered and elevated walkways along and leading to train stations along the main highway of Epifanio de los Santos Avenue (EDSA).

The Asian Development Bank (ADB) will finance both the MRT-4 and the EDSA Greenways projects, according to NEDA.

Meanwhile, a P6.25-billion Maritime Safety Enhancement Program by the Department of Transportation-Philippine Coast Guard will be enforced over four years to improve sea transportation.

Also up for approval by the NEDA board is the P175.7-billion Bataan-Cavite interlink bridge project. The 32.15-km four-lane bridge will start in Mariveles, Bataan province in the central Luzon, cross Manila Bay and end in Naic, Cavite province. It is expected to be finished in six years.

The Duterte government also plans to build a 3.3-km bridge with a 3.4-km elevated viaduct, with two lanes in each direction, and a 4.9-km four-lane coastal road with a 4.75-km elevated viaduct in Cebu province. The road project will cost P76.41 billion and will be funded through official development assistance.

Another project that will be up for approval is the Davao City coastal bypass road with the Bucana bridge project worth P28.26 billion, which will serve as an alternate route to the Davao-Cotabato Road and ABS-CBN Diversion Road to ease traffic congestion along busy intersections and the central business district, according to NEDA.

Meanwhile, a 35.64-km road and eight bridges will be built under the P5.89-billion Capas-Botolan road project, which will cut travel time between Tarlac and Zambales to one-and-a-half hours from four hours. The project is expected to start operating by 2025.

Also included is the P189.53-billion Panay-Guimaras-Negros Island bridge project that will link the three islands.

The NEDA board will also look at changes in the scope and cost of a supplemental loan for the Davao City bypass construction project, which has more than doubled to P42.84 billion. The board will also review a proposal to build an 11.3-km coastal road in Samar province. — Beatrice M. Laforga

Stocks, peso drop on 1st trading day of 2020

January 3, 2020 | 12:31 am

By Denise A. Valdez
Reporter

THE Philippine Stock Exchange index (PSEi) started the year on a dour note as the benchmark index slipped, while the peso weakened against the US dollar on the first trading day of 2020.

The Philippine Stock Exchange index (PSEi) shed 72.73 points or 0.93% to close at 7,742.53 on Thursday, as investors continued to be spooked by increasing regulatory risks.

Despite the downbeat start, analysts still expect a “good market” throughout the year.

“In 2020, we’re expecting a good market. First and foremost, because of the accommodative government policies,” Philstocks Financial, Inc. Senior Research Analyst Japhet Louis O. Tantiangco said in a phone call, referring to low interest rates and the expected on-time passage of the national budget.

“Last year, we started off with high rates. This year, we’re starting with a loose monetary policy,” he said. “Given the low interest rates and the national budget expected to be signed on time, we expect this to help in boosting the overall economy, and in turn, to trickle down to the market.”

This is in line with the bourse operator’s expectation that the main index will “soar to new highs” in 2020.

“There’s a lot to look forward to and accomplish this 2020. This will only be possible if we all work together and collaborate on initiatives that will help make PSE more competitive in the region,” PSE Chairman Jose T. Pardo was quoted in a statement as saying.

BPI Securities Corp. has previously pegged the PSEi to reach as high as 9,000 in 2020, driven by economic growth, especially in the banking, property and consumer sectors.

Aside from economic fundamentals, Mr. Tantiangco of Philstocks said listed companies’ fundamentals are likewise doing well.

“The fact that we still have a lot of stocks that are at bargain levels, particularly index stocks, gives a good opportunity for investors to hunt for bargains,” he said.

However, regulatory risks continue to hound the stock market, as the government continues its attacks against water concessionaires — listed Manila Water Co., Inc. and Maynilad Water Services, Inc., whose key shareholders include listed Metro Pacific Investments Corp. and DMCI Holdings, Inc.

Shares in Manila Water lost 66 centavos or 6.37% to P9.70 apiece on Thursday while shares in MPIC shed 12 centavos or 3.45% to P3.36 each. On the other hand, DMCI shares inched up 1.36% to P6.70 each.

Mr. Tantiangco noted the regulatory uncertainty initially affected water stocks, but the negative sentiment appears to be affecting other utility firms.

“That will be one of the challenges that are expected to weigh on the market,” he said.

ABS-CBN Corp., whose franchise expires in March and is at risk of non-renewal due to a rift with President Rodrigo R. Duterte, is also taking a beating at the stock market. Its shares lost 10 centavos or 0.63% to P15.70 each on Thursday.

But Regina Capital Development Corp. Head of Sales Luis A. Limlingan said investor sentiment on specific stocks may still change when Mr. Duterte addresses the public on Monday. Until then, most of the risks are external: the volatile price of oil, the outcome of the trade negotiations between United States and China, the US election in November and any weather disturbances that may affect the output of listed firms.

The stock market slump on Thursday hurt the Philippine peso, which weakened to P50.685 per dollar against P50.635 per dollar last Friday. But year-on-year, the peso grew stronger by P1.83 from its Jan. 2, 2018 close of P52.515.

Although the peso’s close on Thursday is “a good start” given that it is still within its typical range from the past days, a trader said in a phone call that continued uncertainty with regard to the US-China trade war and the profit-taking from the market may also be to blame for the slight weakness in the local unit.

Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort also said that despite the depreciation, the peso-dollar exchange rate on Thursday is still among its “strongest in the past two weeks and in nearly two years”.

“Peso was also weaker today after the net foreign selling at the local stock market at -$16.9 million, after the previous trading day’s -$16.1 million…amid regulatory risks on water utilities and TV network recently,” he said in a text message. — with Luz Wendy T. Noble

Regulator OK’s CMIC rules on SBL, short selling

January 3, 2020 | 12:30 am

THE Securities and Exchange Commission (SEC) approved the guidelines prepared by the Capital Markets Integrity Corp. (CMIC) on securities borrowing and lending (SBL) and short selling.

In a statement Thursday, the country’s corporate regulator said the commission en banc on Dec. 17 approved CMIC’s guidelines, but noted this is “subject to the adoption of certain amendments” by its Markets and Securities Regulation Department.

While the SEC had previously approved guidelines on short selling transactions by the Philippine Stock Exchange, Inc. (PSE) in June 2018, and the PSE retains jurisdiction over all short selling transactions, CMIC’s guidelines were made to address other concerns such as the effect of SBL and short selling on trading participants’ books and records, error transactions and any effect on the risk-based capital adequacy (RBCA) ratio of trading participants.

These guidelines, as approved by the SEC, will limit short selling transactions to “eligible securities” or those that are owned by companies in the PSE index (PSEi). Trading participants are tasked to ensure that all involved parties in a short sale transaction have the necessary borrowing arrangements prior to any deal.

The rules require that all lending securities are registered with the SEC and have a Securities Lending Authorization Agreement, and that borrowing parties have a Master Securities Lending Agreement before any transaction.

Trading participants are required to accomplish a stock credit memo for the entry of securities for the borrower, and stock debit memo for securities of the lender. For the return of shares, the participants must secure a stock debit memo for the entry of securities for the borrower, and stock credit memo for the securities of the lender.

The participants are also required to indicate if any deal is being done as a short sale transaction, as indicated through its account with the Philippine Depository & Trust Corp.

Naked short selling is prohibited under the CMIC rules, as customers doing a short sale transaction must execute a notarized undertaking to ensure parties have full understanding of relevant securities laws, rules and guidelines.

The rules also require participants to submit biannual summary reports of outstanding and liquidated SBL transactions and stock returns, together with a certification of submission of said reports to the Bureau of Internal Revenue.

“With the implementing guidelines on short selling in place, we look forward to more robust activity in the stock market,” SEC Chairperson Emilio B. Aquino was quoted in the statement as saying.

“The Commission, however, notes that it shall not balk at exercising its authority to suspend or prohibit short selling in an exchange when necessary for the protection of investors,” Mr. Aquino added. — Denise A. Valdez

POGOs to remain demand driver of Metro Manila offices

January 3, 2020 | 12:06 am

By Vincent Mariel P. Galang, Reporter

METRO MANILA’S office space is expected to grow by 5% this year, with Makati City accounting for most of the supply, a property consultant said, while pointing to demand as continuing to be driven by offshore gaming operators.

“(A) high supply at 1.14 million square meters (sq.m.) from 49 buildings is expected to be completed in 2020. It is also projected to grow by 5% compared to 1.08 million sq.m. in 2019. Makati City is expected to account for the highest supply next year at 353,000 sq.m. supply completions or 31% share of total 2020 supply,” Monique Cornelio-Pronove, chief executive officer of Pronove Tai International Property Consultants, said in an e-mail.

Of the total supply, about 900,000 sq.m. to 1 million sq.m. will be taken up next year, with vacancy rate expected to be around 5-6%.

Ms. Pronove said offshore gaming companies would continue to drive demand, but at a slower pace compared with 2019 due to limited available supply, particularly in the Bay Area where most operators locate.

“Despite limited office supply next year accepting POGOs (Philippine Offshore Gaming Operators), the offshore gaming sector is still expected to drive office demand but on a slower phase compared to 2019,” she said.

“The main factor of POGOs growth in the office market will always be grounded in the ‘office supply.’ POGO sector is expected to slow down next year because of the limited available supply in the Bay Area,” she added.

She said other factors that could affect POGOs’ demand include the crackdown of the Chinese government on gambling activities; the Philippines’ taxation policies on these operators on franchise and income taxes; and the suspended issuance by local government units, specifically Makati City, of business licenses over rising prices of residential buildings, and increasing prostitution activities involving Chinese nationals.

China signaled a crackdown on cross-border gambling, claiming that most of its nationals working in POGOs were illegally recruited. Gambling is illegal in China, pushing Chinese gamblers to travel to another country or go to special economic zones.

Operators are attracted to locate in the Philippines, particularly its business districts as these offer easier access to transportation and other leisure activities. The country has been trying to regulate the growing industry through proper income tax collection, which is also a way to shut down those that are operating illegally.

Ms. Pronove said the information technology and business process management (IT-BPM) industry is expected to recover this year with the implementation of Administrative Order no. 18, or the moratorium on the approval of new economic zones in Metro Manila. The regulation is aimed at encouraging development in other areas.

She said the sector has been growing at an average of 460,000 sq.m. in the past five years.

“The IT-BPM firms is expected to account for around 41%-43% share on demand or estimated 400,000 sq.m. to 450,000 sq.m. However, this is still slower than its previous average in the last five years,” she said.

Now it wants an Oscar

January 3, 2020 | 12:06 am

NETFLIX INC. has been making its own movies for years, but 2019 may be remembered as the year it truly became a film studio.

The company began the year by joining the Motion Picture Association of America, the Hollywood trade group that represents movie studios. It went on to release nearly 60 English-language feature films over the course of 2019, including Oscar contenders The Irishman and Marriage Story.

With a slate that includes its first animated feature Klaus, a Michael Bay action thriller and comedies like Eddie Murphy’s Dolemite Is My Name, Netflix has doubled or even tripled the output of Hollywood’s biggest studios. And for the first time, the company’s top executives are saying that movies will determine whether Netflix hits its financial targets in 2019.

“This fall was a nice culmination,” Scott Stuber, Netflix’s film chief, said in an interview. “I’m very proud of this slate. I can look you in the eye and say we’ve made as good movies this fall as anybody.”

Stuber, 51, joined Netflix in 2017 after more than two decades working in the film business — first as an executive and then a producer. Chief Content Officer Ted Sarandos asked Stuber to build a movie studio from scratch, one that would rival any in Hollywood.

At the time, Netflix had only released a couple dozen original movies, most of them forgettable — like the sequel to Crouching Tiger, Hidden Dragon and Adam Sandler’s comedy western The Ridiculous 6. The company had to fill its slate with projects that had been cast aside by other studios.

Netflix’s one movie that delighted critics, Beasts of No Nation, earned no nominations at the 2016 Academy Awards — an outcome that many experts interpreted as a rebuke of the streaming company. It had resisted demands to release its movies in theaters before they appear on its service, angering cinephiles and movie-theater owners.

“It was a company built on television — that was first and foremost,” said Stuber, a 6-foot-4 executive who brought a fat Rolodex to Netflix from producing movies such as Ted, The Break-Up, and Central Intelligence. Many of his past collaborators, including Dwayne “The Rock” Johnson and director Peter Berg, have since signed on to make movies for Netflix.

FILM FLOOD
In the 2-1/2 years since Stuber took the job, Netflix has morphed into the largest movie studio in Hollywood, at least in terms of volume. The company plans to release 50 to 60 films a year, and that doesn’t include projects born out of other divisions, such as El Camino, a spinoff movie from the TV show Breaking Bad.

The company has scored both critical and commercial hits. Bird Box and Murder Mystery were viewed by more than 70 million people apiece in their first month on the service, according to the company, while Triple Frontier and The Highwaymen both eclipsed 40 million viewers. Six of the 10 most-watched new titles on the service in the US in 2019 were original films.

Still, it’s hard to measure Netflix’s success. The company is selective in what viewer information it releases and there’s no reliable third-party data source. So it’s all but impossible to verify how any one Netflix project fared. The company points to its continued subscriber growth as evidence of success, but critics note that Netflix still borrows money to fund its productions.

Two facts seem clear, though. First, Netflix found a sweet spot making the kinds of movies other studios have abandoned: adult dramas, romantic comedies, and action movies without superheroes. Rom-coms like To All the Boys I’ve Loved Before and Always Be My Maybe don’t have the global appeal of The Avengers, but they are infinitely rewatchable at home.

The sequel to All the Boys is on the slate in 2020, along with movies from George Clooney, Spike Lee, and Ryan Murphy, creator of American Horror Story.

Second, the industry no longer views Netflix as an outsider. Filmmakers Alfonso Cuaron, Martin Scorsese, and Noah Baumbach — all staunch defenders of classic cinema — have turned to Netflix to get their movies made.

And the voters for the Academy Awards have come around, nominating Netflix for 15 Oscars last year, including its first for best picture, best director, best actress, and best screenplay. The company didn’t win the best-picture statuette, but took home its first prizes for something other than a documentary.

‘YOU DID IT’
“When I saw Ted Sarandos after the Oscars, I said, ‘You did it, you got over the hump,’” said John Sloss, who produced Green Book, last year’s winner for best picture. In other words, the Academy is ready — when the film is right — to give Netflix its top prize.

That could be as soon as 2020. Netflix has two of the five movies with the best odds, according to Gold Derby, a site devoted to predicting entertainment awards. They include the current front-runner, Martin Scorsese’s The Irishman. The nominations will be announced Jan. 13.

The New York film critics named that movie the year’s best, and Netflix earned the most Golden Globe nominations of any studio in both film and television.

But this year has been a particularly strong one for movies, and there is no one leader. Los Angeles film critics named Bong Joon-Ho’s Parasite the year’s best, while Sam Mendes’s 1917 has earned ecstatic reviews. Quentin Tarantino’s Once Upon a Time… in Hollywood could finally earn the filmmaker his first Oscar for best director.

The only group that hasn’t embraced Netflix yet is theater owners. Though Netflix has relaxed its policy on theaters — allowing movies to appear on the big screen for as long as a month before they migrate to the streaming service — that hasn’t appeased the world’s largest cinema chains. They still refuse to show the service’s movies.

But many movie studios, including Warner Bros. and Universal Pictures, want to get their movies online sooner, too. And many companies, including Walt Disney Co., are making movies that won’t appear in theaters at all.

“It’s not a Netflix-versus-theater thing,” Stuber said. “The entire film business has to figure out the right distribution model that helps everyone.” — Bloomberg

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