The studio sold the divisive third "Cloverfield" entry to Netflix in a deal estimated between $40-50 million.

The controversial Netflix/Paramount deal for “The Cloverfield Paradox” happened one month into the new year, but it’s bound to go down as one of the biggest industry stories of 2018. The studio quietly sold distribution rights to the third “Cloverfield” installment to Netflix for a reported $40-$50 million, essentially making back the $45 million it spent to produce it. The streaming giant then surprise premiered “Paradox” shortly after the Super Bowl on February 4.

Paramount’s Chief Operating Officer Andrew Gumpert recently defended the decision during a keynote at UCLA’s annual Entertainment Symposium (via Variety). Gumpert joined the studio in January after a 12-year stint at Sony Pictures Entertainment, which means sorting out what to do with “Paradox” was one of his first decisions. The COO admitted that Paramount executives and producer J.J. Abrams all reviewed the movie together and collectively came to the decision that it lacked “commercial playability” if released in theaters.

“The movie was finished, we all reviewed it together with J.J. and his team,” said Gumpert. “We all decided there were things about it that made us have a pause about its commercial playability in the traditional matter. There was an ability for us to be fiscally prudent and monetize [by selling to Netflix]. For fans of ‘Cloverfield,’ the fact is many, many more millions of people saw the movie. It’s a positive on every level.”

The deal sparked backlash from both “Cloverfield” fans hoping to watch the series on the big screen and from industry folk who found the deal positioned Netflix as a “dumping ground” for unwanted studio content. Paramount made a similar deal for Alex Garland’s “Annihilation,” selling the film’s international rights to Netflix in order to minimize a potential financial loss.

Netflix does not release streaming data, but Neilsen reported in February that “Paradox” earned $2.8 million during its first three days, far below the 11 million “Bright” earned over the same time period. The movie received poor notices from critics as well, with IndieWire’s own David Ehrlich calling it a “godawful movie” in his D review. Grumpert’s comment makes it clear Paramount executives saw the writing on the wall early, and hence the Netflix deal was born.

“The Cloverfield Paradox” is now streaming on Netflix worldwide.

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