Monday, 23 August 2010

Hollywood Babble On & On #580: Recession In Session?

Welcome to the show folks....

Patrick Goldstein of the LA Times suspects that Hollywood is heading for a prolonged recession. Here are his reasons, peppered with a few of my own...

1. Major studios like Disney, Universal and Sony are cutting back on developing new movies. Disney because they're only interested in increasingly narrow genres, and Universal and Sony are cutting back because they already spent all their development money.

2. Only Warner Bros. and Fox are maintaining their normal production output, which is still down from their golden age peak. Paramount is still releasing movies, but isn't financing the production for most of them.

3. Revenue is up, but not actual ticket sales. The revenue has gone up because of the spike in prices over 3D movies. When that novelty goes, so goes the market.

4. Wall Street investment isn't around as much as it used to be. Causing a lot of gaps in the money field.

5. There are way less buyers for independently produced films than there used to be. The studio owned faux-indies are mostly dead and gone, and indie distributors like Lionsgate, Summit, and Overture, are all looking to become major studios of their own.

6. The studios are turning more and more to a 'mostly blockbuster' release slate. Cutting out the middle ground that used to fill screens between the Summer mega-hits and the Fall/Winter Oscar baiting orgy.

7. Despite technology supposedly making things cheaper and easier, it is in fact more expensive and harder to make, distribute, and promote films.

8. The value of film companies, and especially their libraries are plummeting, despite wider market opportunities for their product through TV (broadcast/cable), home video, and internet viewership.

9. There's a huge salary crunch where only the absolute top players can command the sort of up front deals that were once so common in Hollywood.

So why is Hollywood slipping into a recession?

If you say it's because of the general economic recession I will slap you with a dead Chilean sea bass.

Remember, Hollywood's golden age, both creatively and financially, was the 1930s, otherwise known as THE GREAT DEPRESSION. Times were a might bit tougher back then, with 25%+ unemployment, 75%-90% upper end tax rates, and a dust bowl choking out the Midwest.

Which brings us to the reason Hollywood is creating its own recession:

It's Hollywood.

All of Hollywood's economic injuries are self-inflicted. Would you invest tens of millions, if not hundreds of millions of your hard stolen dollars, in a major studio film knowing full well that even if it makes a billion dollars at the box office, you will still lose money. Why? Because the accounting practices of the studios make Bernie Madoff look legit in comparison. The latest trick is to take the studio's share of a film's budget out as a 'loan' from the studio's parent company. The interest paid on that loan matching whatever that film should make at the box office and then some, guaranteeing a loss, no matter how much money is made.

Then there's where they spend the money they do have.

Musclebound muscle-head The Situation from MTV's white trash festival Jersey Shore, is looking at making $5 million this years from his show, and related spin-off deals, including an autobiography.

I will bet dollars to donuts that the publisher won't make back that advance. I mean the man's an advertisement for illiteracy. How many of his fans will be able to read, let alone want to read, whatever drivel his ghost-writer, who also has to be paid, puts on the page.

Do you think that inevitable attempts at making movies and TV shows around him will produce anything profitable?

No, he's just another Heidi and Spencer. He'll end up broke, off the air and trying to sell sex tapes of his co-stars within a couple of years, and millions will be wasted on him by Hollywood, and for nothing.

Then there are the films themselves.

Too many of Hollywood films fall into two categories: Slightly dim mega-budget tent-pole films looking for the widest audience, and built around familiar pre-existing brands, like remakes, comic books, and even board games, but are themselves forgettable, sparking little desire to re-viewing. Then there are the Oscar films. The fake sincere melodramas aimed at wowing Academy voters with their importance, while boring or insulting the rest of the audience.

The first kind is becoming too expensive to make, even without the funny book-keeping, and the second kind of film is doing everything it can to repel audiences, equating popularity as some sort of scarlet letter of shame.

Is there a silver lining?

Well, there is, if you have the money and clout.


The middle ground of intelligent, modestly
budgeted films, that don't need a billion dollars to break even, is becoming a wide open market. Multiplexes need a variety of product, even more so as the studios continue to contract in their pursuit of a magic bullet for success, be it spending mega-bucks or going 3D.

Someone who uses new technology to produce intelligent, entertaining material with wide appeal, smart budgeting, honest accounting, and shrewd, penny-wise/pound-wiser marketing strategies, could start whittling away at the dominance of the major studios. Then maybe the majors might be forced to evolve or face extinction.

5 comments:

  1. I'm going to go out on a limb here and say that the studios who wish to make money need to cut costs.

    I know, it's insane.

    All jokes aside I think the meme from ten years ago about movies going digital is the answer.

    If a production company actually did that. All digital cameras, no actual prints, etc, etc, they might actually make some money.

    IF they made good movies.

    Think Pixar.

    They would need to develop that sort of reputation which means they would have to start small, with movies they could make a living on while releasing them only to digital theaters plus whatever DVD sales brought in. Maybe explore pay-per-view via the internet since we're talking digital film.

    The point being that they establish a brand loyalty that would entice theater owners to switch to digital so they could cash in on that reputation.

    That's what Lucas was 'Supposed' to have done with the prequels but we all know how badly he stunk that up.

    ReplyDelete
  2. Looking Glass24/8/10 12:56 am

    It's not just the people at the top. The rot is everywhere. Camera angles, composition, makeup, lighting, writing, actors, even trailers aren't what they used to be.

    So many trailers or publicity stills have horribly backlit shots that were obviously saved in post processing. (They're like singers who are nothing without autotune.) The result lacks clarity and still leaves the nagging feeling that something's wrong with the shot.

    There are similar problems in every aspect of movie making and marketing. See Whiskey's Place for why advertiser's have forgotten how to market.

    I used to like watching movie trailers. They had to tell enough of the story to get you interested, but still not give the plot away. These days I prefer watching video game trailers. They're better done and more interesting.

    These days I look back fondly on "Leech Woman", that MST3K favorite that's at least competently done, despite the silly story.

    Instead of a bad story saved by competent craftsmanship, we now have a situation where it's no longer possible to make a good movie without total control of the whole process. Hello, Pixar!.

    ReplyDelete
  3. Looking Glass24/8/10 1:07 am

    This comment by Scott on Sunday August 22, 2010 @ 3:02am PDT on 'Expendables' Easy #1 Again This Weekend at Deadline Hollywood Daily, is worth quoting in full.

    "The sole and simple reason why all these movies are bombs is because there are virtually NO bona fide movie stars anymore. Simply tune in to Turner Classic Movies, and you’ll understand why. Whatever the channel is showing doesn’t even have to be a “classic”. Even the silliest ‘B’ movie from the past towers over most of the crap Hollywood churns out today merely because the scripts of yesteryear were written by writers who knew how to WRITE (a lost art) and the actors and actresses had distinctive, intelligent personalities (not to mention sexual allure and great looks). One example: Had “The Prince of Persia” starred Rock Hudson or Errol Flynn or Tyrone Power at their youthful peak (and not the dweeby Jake Gyllenhal, whom I’m sure is a nice kid but a swashbuckling leading man NOT), that same movie would have been one of this summer’s major blockbusters. And try to picture “Eat Pray Love” with Lee Remick, Audrey Hepburn or Jeanne Crain in the lead (and not piano-teethed, horse-faced Julia Roberts). Enough said!"


    Someone (maybe Toto) recently had a photo of Audrey Hepburn purchasing ice cream from a street vendor while in a formal gown. With anyone else it's a bleh moment. She turned it into something magical. That's star power.

    ReplyDelete
  4. Blast Hardcheese24/8/10 12:27 pm

    D, how much impact do you think a film like "Inception" will have on the overall decline of 'tentpole' movies? It seems to be doing well (~$600M worldwide) and is by far the smartest and most satisfying 'big' movie I've seen in the last couple of years. With this and Pixar as examples, is there a chance they'll realize that they need to re-focus on well-written movies if they want to raise total ticket sales?

    ReplyDelete
  5. So many current films are made up of gimmicks,situations ,characters etc; strung together for general effect.I guess this is supposed to be really cool,but all those gimmicks are like fast food and sugary snacks ,satisfying in the moment and barely memorable in the end. For all the success of ,"Inception",no one I know is talking about it as a great movie.They had the roller coaster ride and now they will move on to the next movie. It is all diversionary time filler, like twittering, e-mailing ,video-gaming.The days of American films like Tender Mercies, Godfather, L.A.Confidential,Amadeus, or Pulp Ficton might really be in serious decline.Here's a good question for Furious D, what films are watched by large numbers of younger film goers? Scott Pilgrim was supposed to be their kind of film, but they did not turn up in large numbers to see it.

    ReplyDelete