The fall of Hollywood?

Marginal Revolution is wrong. Hollywood is far from dying.

First off, this summer's supposed b.o. slump compared to last year is really just a lack of Passion of the Christ and Fahrenheit 9/11. Those brought audiences into theaters who don't regularly go. If idiots in the stock market are pulling their money out because of one downward dip, they haven't done their homework. One year does not make, nor does it predict, an overall trend.

As the book Blockbuster makes abundantly clear, people are always predicting the death of Hollywood, as William Eaton did in 1914:

This is the problem with death-of-film arguments... they have an uncanny ability to resemble accounts of the birth of film.

It's true DVD has been a cash cow, something HD-DVD won't be, since they can't agree on a format. But that revenue stream is far from drying up. Just because Dreamworks over-estimated the sales of Shrek 2 again does not prove any sort of trend.

You can jump on Hollywood for all sorts of sins. But they are in business to make money -- and they do -- hand over fist. If you don't like Hollywood movies, support good independent cinema.

UPDATE 7/22/2005: The Big Picture blames the ads before the trailers.

UPDATE 7/28/2005: the chutry experiment makes the same points I do, only smarter.