Why Netflix's CEO is waging a war at the most prestigious film festival in the world

When two Netflix titles, Boon Joon-Ho's "Ojka" and Noah Baumbach's "The Meyerowitz Stories," were added to the esteemed competition lineup for this year's Cannes Film Festival, it was another notch in the belt for the streaming giant.

But it was also another moment when the movie industry felt that Netflix is hurting the theatrical movie business.

Now Cannes, the most prestigious film festival in the world (running May 17-28), has decided to tweak its competition rules after this year as a result of the backlash toward the Netflix titles.

On Wednesday, the festival announced that beginning in 2018, a film can only qualify for its competition lineup if it has a theatrical release in France. Netflix has made many enemies in the movie business for rarely having theatrical releases for its movies, and when it does release films in theaters, it does so while simultaneously making them available streaming on Netflix, therefore undercutting the reason to go to a theater.

It's unclear if "Ojka" or "The Meyerowitz Stories" will play theatrically in France.

“The festival is pleased to welcome a new operator which has decided to invest in cinema but wants to reiterate its support to the traditional mode of exhibition of cinema in France and in the world,” a statement from the festival said. “Consequently, and after consulting its members of the board, the Festival de Cannes has decided to adapt its rules to this unseen situation until now: any film that wishes to compete in competition at Cannes will have to commit itself to being distributed in French movie theaters. This new measure will apply from the 2018 edition of the Festival International du Film de Cannes onwards.”

Netflix CEO Reed Hastings responded to the ruling with an aggressive Facebook post saying, "the establishment closing ranks against us."

This is the latest chapter in the tug of war Netflix has between delivering content to its subscribers and trying to build clout within Hollywood.

Here Netflix has a major difference with its chief rival Amazon Studios, which has released its movies in a traditional manner, with exclusive theatrical windows before making titles available to stream. Amazon won two Oscars earlier this year with its acclaimed drama "Manchester By the Sea."

Netflix struck out with an award-season hopeful in 2015, "Beasts of No Nation." It was blacklisted by most theater chains because it played in theaters while streaming simultaneously.

It will be interesting to see if the streaming giant will change course in its exhibition plans of the anticipated "The Irishman," Martin Scorsese's movie starring Robert De Niro and Al Pacino that Netflix acquired. In making an award-season push, will it play by the industry's rules?

Since the movie probably won't come out until 2019 (it begins shooting in August), Netflix has some time to figure out a game plan.