Wall shear stress modification in self-aerated flows has been observed in boundary layer–type flows mainly in the form of drag reduction. Due to its complexity, drag reduction has predominantly been studied using experimental techniques and empirical analyses, whereas the development of conceptual approaches is limited. In this study, two-phase open-channel flow equations with variable density are revisited and bottom air concentration is identified as a key parameter for drag reduction in air-water flows. The application of this new theory to smooth and stepped chute flows is introduced, and implications for the determination of friction factors are discussed. A modified version of the Manning-Strickler formula is proposed to model friction factors across a wide range of roughness and bottom air concentration levels.