Hollywood lightens up

Heavy-handed or overtly political films no longer stand a chance in the current economic climate. The cute dogs of Marley and Me are much more promising.

It used to be an iron rule in Hollywood that when the economy dips into recession, the movie industry continues to do just fine. People need escapism, the argument runs, and never more than in hard times. Over the past 40 years, America has experienced seven years of recession, according to the National Association of Theatre owners, and Hollywood box office receipts have increased in five of them. As Dan Glickman, the president of the Motion Picture Association of America, puts it: "The movies are great therapy. It's a lot cheaper than a psychiatrist."

Suddenly, though, the industry prognosticators are a lot less sure of themselves. America is facing its worst economic outlook since the Great Depression, and Hollywood is in as bad a spot as anyone can remember. The media conglomerates who own the big studios are cutting jobs right and left. In December, NBC Universal announced it was cutting 500 jobs across its various business interests, and Viacom said it was letting 850 people go at its media companies, including MTV and Paramount Pictures. On top of that, the industry is still recovering from last winter's writers strike and still crossing its fingers about averting a strike by the Screen Actors Guild.

All that makes Hollywood a very different world from the industry of the 1930s, when the Great Depression coincided with the arrival of the talkies and the invention of one irresistible genre after another, from the screwball comedy to the gangster movie. The Depression was very good to the makers of high society comedies and musicals, to directors like Busby Berkeley (who famously choreographed pools full of flower-clad synchronised swimmers), to horror icons like Frankenstein and King Kong, and to just about anything put out by the Marx Brothers.

By contrast, the top grossing films of today's American box office are flicks such as Marley and Me, the lightweight comedy about a family coping with a pet dog. Four Christmases, a formulaic seasonal comedy in which a couple races to see all four of their parents in a single day, also did well. These films certainly take people away from their day-to-day concerns about job security, but no movie executive is betting on their power to shore up an entire industry. Ticket prices are roughly twice as expensive now, in real terms, as they were in 1933, and film production costs are eight or 10 times as high.

For now, Hollywood considers itself fortunate. Revenues are roughly similar to last year's, in part because of increases in ticket prices, and overall admissions are down about four to five per cent - a relatively painless decrease, at a time when seasonal retail sales are down as much as 16 per cent from 2007. Where things go from here, though, is anybody's guess. The writers' strike prompted studio executives to rush dozens of projects into production, and those overhasty projects are now about to hit cinema screens.

Some of the surer bets of the upcoming year include the sixth instalment of the Harry Potter series and two highly anticipated 3D movies (the genre is making a comeback thanks to improved technology in filmmaking and exhibiting), Monsters vs Aliens and My Bloody Valentine. If Hollywood is lucky, it will produce two or three blockbusters to match the earning power of last year's box office winners The Dark Knight and Iron Man, which together accounted for almost 10 per cent of overall box office receipts.

The other end of the market - artier films that contend for awards - looks altogether more bleak. Spending on this year's Oscars marketing campaigns is down about 50 per cent, which means films relying on awards and the surrounding hoopla to attract audiences - films like the Nazi-tinged love story The Reader or the 1950s domestic drama Revolutionary Road, or Doubt, which examines the conscience of the Roman Catholic church - may not get the support they need to make their money back.

Conventional wisdom is adjusting relatively quickly. The verdict, based on 2008 results, is that heavy-handed or overtly political films like W (Oliver Stone's biography of President George W Bush) or Body of Lies, the Leonardo Di Caprio/Russell Crowe thriller with overtones of the Iraq war, no longer stand a chance. Much more promising are the cute dogs of Marley and Me or of another unlikely box office smash, Beverly Hills Chihuahua.

"If I were a studio head I'd start greenlighting a bunch of light escapist movies - fantasies, musicals, comedies, romances," Anne Thompson of the industry newspaper Variety wrote recently. Chances are, the executives will be doing just that.