question of the day: Will the Great Recession force Hollywood to be more creative?

To hear people talk, this summer the industry may have hit the bottom of the market. That is, unless things get even worse. First off, there are fewer buyers than ever before. Most of the specialty divisions have been shuttered, New Line has been absorbed into Warners, MGM is in suspended animation and of the six remaining major studios, at least two -- Universal and Sony -- have spent all of their development money for the year, putting a big crimp in the marketplace. (The studios in question say they are still developing projects if the right one comes along, but according to every agent and manager I spoke to, the packages are awfully few and far between.)

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Wherever you look, there is consolidation and financial stress as people have been forced to adjust to a Darwinian thinning of the herd. "You'd have to say that this summer we probably hit bottom, certainly creatively, with so many studios relying on so much pre-sold branded product," said one top agent. "It's really hard, because so much money has left the business, there are fewer distributors than ever before and many of the ones that are left have cash problems, so it's just agonizingly difficult to get a movie up and running right now."

A Darwinian thinning of the herd should, theoretically, leave the strong and the clever still standing. I mean, cleverness isn’t automatically a survival skill in Hollywood, not when so much that’s dumb sells so well, and certainly not when only two of the top 10 box office movies of 2010 so far are entirely original. Still, one might expect -- or perhaps merely one might hope fervently and keep one’s fingers crossed -- that a tightening of the belt would mean a touch more creativity in our movies. Because for all the based-on-existing-material films that succeeded this year, there were plenty that were big-budget failures, too.

Goldstein doesn’t offer much hope, however:

Even worse, the kind of movie a studio will finance right now has narrowed considerably. Studios will spend fortunes on their big tentpole or franchise movies, because those are the movies that move the needle, both in terms of making the best use of studio marketing dollars and attracting audiences around the globe, which is where the biggest profits are these days. When it comes to the kind of films that talent want to make -- ones with slightly loftier aspirations -- the studios will only play ball on their terms and on their schedule, forcing everyone involved to work for what in Hollywood passes for peanuts.

On the other hand:

You could actually make the case that it's an especially good time to invest in the movie business. With studio releases down perhaps as much as 25%, films can play longer with less competition for the moviegoing dollar. (And with fewer studios to advertise, ad rates could dip as well.) Physical distribution costs are going down as well, thanks to the arrival of digital distribution. And best of all, at least to an investor, talent costs are way down, with only a precious few stars getting first-dollar gross, so a new investor could get to profit faster than ever, even if they are making a star vehicle.

Are you hopeful? Will the Great Recession force Hollywood to be more creative? Even if it means we have to wait until 2013 or 2014 to see a new creativity busting out?

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