[As a meta-note, this is the first time I've tried a trackback. Not sure I'm using it properly, either technically or from a societal norms perspective. And it didn't seem to work. Maybe next time.]
This blog post has gotten me thinking about how the economics of the movie industry may be changing.
For the last thirty years or so, Hollywood has increasingly focused on the blockbuster and courted a young demographic (the 16-25 year olds, or some similar range). This has led to some non-intuitive behavior on the part of the studios. They can actually have less risk by spending more money. By paying Tom Cruise an exorbitant salary and giving him backend participation, a movie like "War of the Worlds" with a 132 million dollar budget (and probably at least half that again in marketing budget) is considered less of a financial risk than "Little Miss Sunshine" with a budget of 8 million dollars.
Now, I think that there are (at least) two interesting changes going on with the demographic that the movie studios are targeting. First, there's a lot more things to do: video games, and all things Internet (MySpace, YouTube, iTunes, bitTorrent downloads) to occupy their time. And this audience is fickle. They follow the latest new, hot thing (which is one of the things that makes them such a bonanza when you get them). The other change is that teens are spending less time out in world and more time under the watchful eye of the parents. Now, I have no direct data to support this, but people like danah boyd study this and believe it to be true.
Both of these changes in the marketplace seem to be likely factors in declining numbers for that target demographic (I think there are other reasons for declines in other demographics).
What does this all mean? Well, I hope it means that big budget, big name extravaganzas targetted at teens will start to be riskier, and there will be more of a market for movies like "Little Miss Sunshine", though maybe that's wishful thinking on my part. Of course, there's a whole lot going on in this area with the Long Tail and changes in the distribution channels. I can't say I've got my head around the problem at all.
