2005: The beginning of an inexorable slide?

Great piece by Anne Thompson in The Hollywood Reporter.

...[T]his year's pictures aren't any worse than usual. They meet the studio standard -- such as it is.

But they're not good enough to fight the multimedia competition: Streaming Live 8 on AOL, ESPN baseball, iTunes, In the Groove, Comcast on Demand, EverQuest, Netflix, Arianna Online, HBO, CinemaNow, LiveJournal, Drudge, PokerRoom, MySpace, Yahoo!

As ever, just when Hollywood thinks it has figured out the winning formula -- build tentpoles, sell the bejeezus out of them, and everyone will come -- it's way past time to come up with a totally new approach. The studios are running on fumes, and they are nervous. They don't have a simple solution for what's happening.

Thomspon packs a lot of great ideas into this piece:

"...[W]hat if the studios gave up the quest for record-breaking openings, No. 1 standings, biggest grosses ever? Maybe Hollywood should rethink its bigger-is-better model. Back in the old days, each studio placed its chips on a few tentpoles a year. When did it become essential to stage an `event' every weekend? Make something that is so expensive, and it must appeal to a wide audience. There's no room for risk. Studio fare has become bland, washed out, vanilla."

Whatever happened to making movies for niche audiences? Hollywood doesn't do it, in part, because it doesn't understand how to use new technologies to communicate with those smaller audiences; what it excels at is making massive TV, print, and radio buys - using old media to reach old-style mass audiences.

Thompson writes: "The new media is prepared to exploit the interests of niche audiences even as Hollywood ignores them in its attempts to please the widest common denominator."

That is what you call a problem. When you can only make giant, expensive products for giant customer bases, you are becoming a victim of what the brilliant Clay Christensen has termed "The Innovator's Dilemma."