Disney's Bob Iger wins this week's Emperor's New Clothes award for pointing out there are too many films out there competing for too little space. The flip side of the institutional investment boom was that the amount spent exceeded reasonable investments. What Iger alludes to is a simple fact: that cinema has physical restraints on what money could potentially be recouped in the limited number of screens available worldwide.
The inevitable situation is that more well-financed films have been released that are chasing a static amount of space. And many of the newly built screens are in emerging markets that have not necessarily been open to Hollywood's embrace. If a country has the screens and the room for expansion, it is holding a pretty good hand at the moment.
So Iger has the right idea in believing the smartest move is to reduce the number of films but give bigger marketing and distribution clout to those that are made.
Most of the studio world has reached the same conclusion, with a number looking at a dual policy of fewer but better big movies coupled with acquisition and sometimes production of smaller films in local markets. Less is more is a fine maxim in most businesses, particularly where financial perspective is distorted by a sudden influx of money.
Sustainability surely remains the key to the long term for Hollywood, particularly in a market which is intrinsically volatile because of its reliance on the shifting sands of customer taste.
For those who believe Hollywood needs taking down a peg or two, none of this is good news. If the studios made a few less films and concentrated on the efficiency of global distribution, that wouldn't create a single screen for independent competition. It would just increase competition between studios. In fact, it is likely the world's cinema-screen space will be squeezed still further.
The crumb of comfort is that the studios do not understand international taste and will concentrate their efforts in supporting films that people do not want to see. Recent history suggests otherwise. Iger is surely right to think that the cinema of spectacle has an audience that transcends criticism. The huge box-office numbers for disappointing sequels suggest customers will sacrifice plot, depth and subtlety for sheer spectacle.
The disturbing reality for those who also see another cinema, immersive and beautiful that speaks to us as individuals rather than as a mass audience is that the same debate isn't happening elsewhere.
The production of US film is actually falling from a peak in 2005. But in other production centres in Europe and Asia, the numbers are rising relentlessly. What's more, an increasing number of films are being produced with almost no chance of any significant distribution and hence with financial failure written into the script.
The situation with Hollywood is really a sobering up after a hedge-fund binge that was always going to end in an almighty hangover. But if the boom in production that Iger wants to correct was a symptom of the limitations of global capitalism, what explains the corresponding growth in production in Europe, for example'
Most of that production is sustained only by the (unasked) largesse of taxpayers. It is justified by governments on the basis that culture needs support against the Hollywood behemoth and a free market won't do the trick.
That's quite true, but where does it stop' Looking at the increasing production numbers for Europe and the impact of films at the box office, one cannot help but recall the butter mountains and wine lakes of previous subsidised production in other markets.
In a recession, soft money may become harder when politicians have their Bob Iger moment.
The film business can give a good impression of being a battle between the stupid money and the subsidies. Whether driven by digital change, political demands, financial realities or just a dose of common sense, the current economics of film and the level of production will change. Do you agree' E-mail email@example.com.