The Oscars and the Box Office: A Tale of Two Hollywoods

The ballots for the 83rd annual Academy Awards have been sent out, and it's time again to fret about the future of the movies—and of Oscar.

The Academy of Motion Picture Arts and Sciences is carefully watching the second iteration of its biggest Academy Award rule change in decades—allowing a slate of ten best-picture nominees, up from the traditional five.

The expansion came about because the voting members of the Academy had increasingly been taking the word "best" in the category's name to heart, and first nominating—and then awarding their top prize to—daring, unusual, and iconoclastic films.

As a rule these movies didn't attract big audiences; most heretically, many didn't even have actual movie stars in them. The best-picture win of No Country for Old Men, from 2007, was an important catalyst. The film, a tone poem about a guy with a bad haircut and a bolt gun, was one of the least-seen best pictures ever. And everyone from Nikki Finke to the New York Times bemoaned Hollywood's ostensible elitism.

Highest-Grossing Best Picture WinnersLowest-Grossing Best Picture WinnersImage Map

The issue has real-world consequences for the Academy. The No Country Oscarcast, the one Jon Stewart hosted, had dreadful ratings. It endangered the franchise of what was once the Super Bowl of entertainment programming—not to mention the Academy's cash cow.

What to do when the voters weren't doing what's best for the ratings? The new system essentially created an affirmative-action program for disadvantaged blockbusters—with the hope they might bring along some of their audience to watch the show.

The system went into place in 2009. This was the year of James Cameron's Avatar, the highest-grossing picture of all time. (In non-inflated dollars, the film was merely as big as 101 Dalmatians, but whatever.) Avatar made the best-picture nomination cut—but in the vote lost to the uncompromising and unrelenting The Hurt Locker, which, incredibly, made less than a quarter even what No Country had.

The Hurt Locker also happened to be directed by James Cameron's ex-wife. The voters were plainly displaying their contempt for blockbusters.

There are in fact two movie industries in the country now, each with its own audience and support system. The first, biggest, and loudest creates cacophonous entertainments that are shared by an increasingly young crowd in mall multiplexes across the nation. They troop in, almost en masse on opening weekend, to be exposed to $9 popcorn and earsplitting commercials before seeing that week's must-see movie. This audience is remarkably un-price-resistant when the industry has convinced them the films are something it needs to see. A dreary chunk of these movies are sequels (Harry Potter, Pirates of the Caribbean, Transformers), remakes or reboots (Alice in Wonderland, Star Trek, Batman), repurposings (Yogi Bear, Alvin and the Chipmunks, G.I. Joe), the work of franchise directors like Michael Bay or Roland Emmerich, or some combination thereof.

The problem? Movie attendance has been trending downward for a decade, even as the population increases. The 2010 North American box office was a boon to the industry, essentially matching the celestial $10.6 billion figure from 2009—a full billion dollars higher than 2008. But those big numbers distract attention from a scarier statistic: Actual movie attendance fell quite sharply, down more than 5 percent to 1.35 billion, the lowest mark in 15 years. (Meanwhile, of course, the population increased by about 15 percent.) Gross receipts stayed high only because of the steep surcharges accompanying 3-D and IMAX showings.

That's great news for the industry if these remain the norm, but worrisome if they're just a fad. But it's not like 3-D and oversized screens are things that the movie industry has seen come and go in the past.

Oh, wait ...

The other Hollywood makes films for adults, generally on limited budgets, with a premium on thoughtful scripts and good acting, and a willingness to deal with difficult subject matter. They are made from good books or are written by their auteur directors or screenwriters; they generally feature mid-list or non-stars and play to an audience amenable to substance. These movie fans can consume the film in a theater, but is often content to wait for the video release or on-demand, which allows them to watch the thing in peace and quiet on ever-cheaper 52-inch flat screens.

The films favored by the smaller second group are of course at a competitive disadvantage. But, over the past 20 years, led by the relentless art-film impresario Harvey Weinstein, the films in the latter category have based their marketing on critical acclaim and awards. So effective has this process been that the movie-making industry itself--the folks who actually vote on the Oscars—essentially came to accept the premise entirely. By the mid 1990s, it wasn't unusual for the slate of best-picture nominees to have a collected box-office gross less than—and sometimes a fraction of—any one of the year's most-popular films.

But with (generally) reasonable budgets and creative financing, this Hollywood is thriving. In other words, these filmmakers created a market for art in a difficult marketplace. The pouting from the rich guys who make the crappy blockbusters—and the fretting about it from journalists who should know better—is unbecoming.

This year, there are a couple of films—The Social Network and True Grit—that combine auteurism and at least some semblance of a commercial instinct. It's hard to see how the former won't be the evening's big winner. Also assured of nominations are on the one hand a very dark vision—Darren Aronofsky's Black Swan—and on the other a silly but skillful entertainment-with-airs, Inception, which with a box office of nearly $300 million is arguably the only mega blockbuster of our time that deserves to be in the best picture category.

In the end you have to ask: What is wrong with the status quo? The motion-picture industry uses the Oscars each year to tell us the movies it thinks are best, and and conducts the whole process with a great deal of integrity. There are strict limits on campaigning, and the handling of the voting is conducted with care and discretion.. It's refreshing to see such an institution increase, rather than decrease, its integrity in this overcommercialized time. The one fair criticism of the process is that the large percentage of actors in the voter pool seem unlikely ever to give a top award to an animated feature, even from sainted Pixar.

As for that other Hollywood, the one purveying all the sequels and remakes? Its principals are raking it in, to be sure—but they also go to sleep each night fretting about new ways to wring more money out of that shrinking audience, and wondering if there's something they could be doing differently.