At the dawn of 2013, Hollywood is edging toward cautious optimism. The box office is set to shatter domestic records and the home-entertainment sector is poised to grow after five years of losses.
A year ago, TheWrap asked six experts the daunting question: How do we fix Hollywood? This year, we reached out to a new set of thought leaders across the spectrum of the movie business to ask:
How do we make sense of the changing landscape? And what trends are emerging as a new year dawns?
From "Paranormal Activity" producer Jason Blum to Black List founder Franklin Leonard to Film Nation CEO Glen Basner, here's what they had to say:
CHRIS MCGURK CEO, Cinedigm
We're entering a period of tremendous upside for the independent film business. Finally things are coming together in terms of digital technology.
The cost of making a movie that's worthy of theatrical release is now a hell of a lot less than it was a few years ago, and the profusion of digital services like Netflix and Hulu and Amazon is reaching a critical mass.
They're in an arms race for content, and that's creating a perfect storm for independent film.
People have to re-screw their heads on about the way a film is released. It used to be that a movie had to be picked up by an independent distributor and get to 500 screens to be validated as a movie, but it takes $5 million to $10 million in marketing to do that, and it makes it difficult to get a return on your investment.
It's still really important to get a theatrical release, but it should be done in a smart targeted way, in a few key markets. It's important to get those reviews and publicity so they raise awareness of a film for ancillary markets, but you have to do it in a way where you still have a shot at making money.
CATHERINE PAURA Founder and CEO, Capstone Global Marketing & Research Group
The box office will break records this year with the biggest admissions bounce in more than a decade.
That inspires confidence. Families are going to the movies. Women are going to the movies. But the most reliable audience may be older people.
Don't forget about the old people.
When we started the National Research Group 35 years ago, moviegoing was a young person's domain. Older people went to the movies, but we stopped sampling after the age of 49. The target audience ranged from teenagers to the late 40s. Now it goes up to the mid-60s.
It first became clear moviegoing was getting older in the late '90s, when older people didn't stop going to the movies like the generations before them. It reflects that Baby Boomer population, which has always been a huge population -- and still goes to the movies.
When movies are in the marketplace that appeal to older people, they go. They'll go see "Hope Springs" and "The Best Exotic Marigold Hotel," but they'll also go see "Ted" and "The Avengers" once they're in the zeitgeist.
Hollywood also needs to communicate that movies that are going to be on the big screen should be on the big screen. If you have a movie that doesn't look or feel big, it's very hard to get enough people to see it.
FRANKLIN LEONARD Founder, the Black List
I spend a lot of time thinking about data and how data can be used to improve the film business. One way that seems both obvious and interesting is making movies that already have an audience.
Hollywood typically assumes that means, "Oh there's a built-in audience for this board game." That's wrong. It means determining ways to identify audiences for specific subjects or ideas via the internet, social media and surveys.
If you have a piece of material and you want to get butts in the seats, how do you identify and communicate with that audience and convince them to leave their house, pay to go to a movie and sit there and watch it?
We're talking about something besides billboards and trailers on television. Whether it be with Twitter, Facebook or people with Netflix viewing logs, there are more direct ways to communicate with those people and remind them, "Hey there's this thing coming out tonight you might be interested in seeing."
The Obama campaign did a remarkable job of identifying potential voters and converting them into actual voters. If the industry looked at all potential viewers like that, it could bump up not only domestic box office but also revenue streams further down the line.
JOE PICHIRALLO Chairman, Tisch School of the Arts' Undergraduate Film & Television program at NYU
You've always had to be entrepreneurial. In the '90s, you wrote a script, then you'd find an agent or go to a studio. And studios used to be underwriters of producers and would cover their costs with the idea that somewhere down the line they would come up with material they'd want to make.
Today, those deals are almost gone -- you're dealing with a shrinking universe in terms of mainstream sources of support. So you have to be more savvy in your approach.
With more entertainment avenues available to young filmmakers -- with web series and the internet -- you have to find ways to use these tools to support yourself.
You have to understand how to build a following on social media. It doesn't have to be 50 million people. I had one alum who had 3,000 Twitter followers, but he interacted with them, and they were passionate. IFC took notice of him because they wanted access to his followers.
That suggests there is a more democratic way to get noticed than there was 10 or 15 years ago.
GLEN BASNER CEO, FilmNation
Most Hollywood agents and representatives don't believe it, but it's a great time for talent in Hollywood. With studios making fewer movies, there's more of an opportunity to go outside the system and make a project you're passionate about.
And it's much easier to have a hand in the creative process and in the development of a movie than when you're getting a big fee from the studios, making $20 million before you step on set.
Don't get me wrong, studios have a lot of strengths -- more advantages than disadvantages -- but they are not nimble. They can't tailor each project to specific filmmakers. That has allowed smaller companies to enter the void and have a bigger impact than ever before.
This also presents an opportunity to get involved financially, to bet on yourself, bet on the movie and reap the rewards. Look at Terrence Malick. He has more ownership in the movies he's worked on than ever before, and he feels that will help him make better movies.
You can have a great experience with a project you're invested in emotionally and do really well economically -- the Hollywood equivalent of having your cake and eating it, too.
BILL BLOCK CEO, QED International
The fight for distribution is still that narrow gate, despite all the new media platforms. The business has been around for, what, 80 years? But there really are still just six or seven studios. It remains the great barrier to entry and the great goal: wide-release studio distribution.
Foreign markets have become much more important for getting that initial greenlight. You have to be thinking about how a project is going to potentially play from Leicester Square to the Champs-Élysées to the Shinjuku in Tokyo.
China and Russia and South America, these are growth territories. By that, I mean growth in exhibition and the theatrical experience. You have moviegoing demand there, but that's quickly followed by discernment. It's got to be good.
Another thing, from "John Carter" to "Battleship" to "Total Recall," somehow audiences are not moved by the spectacle movie like they were a couple of years ago. Maybe it's just over-familiarity whereas you take something like "Chronicle," and it's fresh and it's a different kind of special-effects movie.
RICH ROMAN WAUGH Director, "Snitch"
When people say there are no good movies being made, I totally disagree. The people who are making good movies are just rolling up their sleeves.
From the craft service person to the 800-pound gorilla producer, everybody is getting crushed in these economic times.
You used to see a lot of resistance from actors demanding their quote, but now they know you have to roll the dice and bet on what they're doing instead of getting a big fat upfront fee. This applies to below-the-line people, too. They have complained about how the work is not in L.A. anymore; it's going everywhere. So roll with it.
The challenge remains the same: Tell compelling stories. You just need to do it cheaper, which technology and passion enable.
If you're not making "The Avengers," if you're not making a Marvel franchise or "Spider-Man" where they'll spend a god-awful amount of money, you need to adjust. You're not getting the same budget you used to, and it's fine with me.
The last decade was such gluttony and excess -- huge budgets for movies that could have been made much cheaper. I'm not going to name them, but you know what they are.
I'd rather figure out how to make that movie that I can be passionate about, and you can see by the movies this year a lot of people are doing that. From "Zero Dark Thirty" to "Lincoln" to "Argo," I'm more excited this year than I have been in a long time.
JASON BLUM Founder and CEO, Blumhouse Productions
I work in the low-budget level. I hope that what we do is not just cut costs, but cut costs in a way that forces filmmakers to think about storytelling in a different way. I really believe that parameters make for better content. When you have fewer tools in your tool box, you have to focus on character and story.
The movies that came out this year were greenlit and developed 12 to 24 months ago. Now that's at a time when the movie business was never harder and look what happened -- there were more high-quality movies than just a few years ago.
Hollywood is in flux. Distribution is changing, so that puts a squeeze on all of us who got used to spending more freely when the model was rock solid. Even though there is less money for filmmaking, I think it's a huge opportunity.
We don't know where the industry is going to land, but people are consuming more content than they ever have before, we just haven't figured out how to monetize this audience, but eventually we will.
DAVID EDELSTEIN Movie critic, New York magazine
We have all these incredibly wonderful people who have grown up with movies and they now have the tools to make their own projects like never before in the history of the business.
The cost of doing what 25, 30, 40 years ago could only be done with the backing of a studio has decreased to the point where you can just pick up a camera. That's why there's no shortage of interesting and important movies being made. The trick is to get them seen and to compensate the people who make them.
Studios seem to be using such a disproportionate amount of their resources on franchise and tentpole films that they have little left over for anything else. Then in November and December, we're suddenly inundated with this insane Oscar-driven culture.
I understand that it's the source of employment for a lot of Hollywood publications, but it is absolutely crazy. It ruins it to see movies only in terms of ranking and odds-making -- is Anne Hathaway up or down? And here comes the girl from "Beasts of the Southern Wild"!
If a movie isn't nominated, there's no buzz and the crowds just move on, and I hate that more than anything. There are so many wonderful movies that are labors of love, that are just joyful expressions, and they get caught up in this "American Idol," "X-Factor," "300 Days of Oscar" culture that, to quote the James Bond picture, only cares about who is the last rat standing.