James Wan has staked out a place among the modern masters of horror, directing films like Saw, Dead Silence, Insidious, and this inspired-by-true-events chiller based on the experiences of real-life paranormal investigators Ed and Lorraine Warren. The Warrens, best known for their work on the strange case that inspired the Amityville Horror movies (which played a part in The Conjuring 2), were portrayed by Patrick Wilson and Vera Farmiga, who grounded the effective jump scares and freak-out moments with a believable world-weariness. Together, Wan and his co-leads found fresh terror in familiar genre tropes, and the end result is a sprawling cinematic universe that only continues to grow.

It's October, which means we're all supposed to watch horror movies (as if compelled by civic duty). It's not enough to celebrate Halloween's occurrence; we must commemorate its 30-day run-up through hay rides, haunted houses, pumpkin spice, and scary movies. If you are a fan of the horror genre, and view its consumption as a moral imperative during October, then there is no shortage of content for you.


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October movie releases: This year features numerous high-profile horror film releases, such as Pet Sematary: Bloodlines, The Exorcist: Believer, Five Nights at Freddy's, and The Nun II, among others. The average Rotten Tomatoes score of these movies is 31%, but who cares.

October TV movie marathons: If you are a cable subscriber and want to watch spooky films without changing the channel, you can indulge in horror marathons on Turner Classic Movies, Pluto TV, Syfy, Freeform, and AMC. Enjoy watching gruesome slasher films censored for cable audiences.

Over the past decade, movie attendance has fallen as audiences stay home to indulge in a relentless slog of premium mediocre content like Ginny & Georgia, Too Hot to Handle, or a faux reality series about Rob Schnieder called Real Rob (I did not make this one up). Movie studios have responded to this shift in consumer preference by opting for a risk-averse approach to content development, betting on concepts with proven box office success, such as big-budget adaptations and, yes, horror movies.

So today, we'll explore entertainment's horror movie industrial complex. We'll examine the dynamics that make this market idiosyncratic yet wildly lucrative and study the works of an indie production company that has templatized an exceptionally profitable model of horror film development.

The Exorcist premiered in the winter of 1973 to overwhelming public interest, captivating audiences with its harrowing story of demonic possession. The film smashed box office records, becoming one of the highest-grossing movies of all time and a critical darling nominated for 10 Academy Awards, including Best Picture.

Unlike big-budget action franchises, horror films are produced on meager budgets in hopes of achieving modest returns. These low costs are a product of the horror format as much as they are a savvy financial strategy. Scary movies often eschew expensive special effects, A-list actors, grand sets, or expansive locations, instead maximizing the potential of limited settings, practical effects, and innovative camera techniques. The genre prioritizes concept and atmosphere ahead of fanciful visuals or well-known players.

As such, horror films don't have to achieve blockbuster grosses to turn a profit. When examining average ROI by genre, horror films stand out as a significant outlier, averaging a 173% return (i.e. profit) on production costs.

In his 1981 review of the slasher flick Friday the 13th Part II, Roger Ebert, arguably America's most influential film critic, griped, "About two dozen movies a year feature a mad killer going berserk, and they're all about as bad as this one." Audiences did not care for Ebert's assessment, and the film grossed $22M on a budget of $1.25M.

In a 1980 review of that film's predecessor, Friday the 13th, Gene Siskel, Ebert's collaborator and arguably America's second-most influential film critic, dubbed the horror classic "a truly awful movie." But he didn't stop there. Siskel opened his review by purposefully spoiling the film's ending to dissuade potential viewers from seeing the movie. And if spoiling the finale weren't enough, the disgruntled reviewer ended his write-up by encouraging readers to contact the movie's producers and star to complain about its content (going so far as to provide their contact information, which qualifies as doxing).

When it comes to the horror genre, there is little correlation between a film's profitability and its box office performance. Horror devotees do not care about the opinions of film critics, film scholars, film theorists, Letterboxd reviewers, IMDB reviewers, or anyone else. Horror lovers want to see horror movies, plain and simple.

A bad horror movie makes for a good investment, while a decent drama will likely lose money for its producers. When we graph average user rating against median percent ROI, horror is, yet again, a significant outlier for its low viewer appraisals and absurdly high returns.

These films may not be glamorous, but scary movies are the entertainment industry's underpriced junk bonds (or blue chip stocks, depending on your feelings for the genre). The more I learned about horror's impervious economics, the more I was struck by one overwhelming question: If this formula works so well, why aren't there more horror movies? Well, one curious film studio also had this question, and they decided to do something about it.

Blum's remarkable success raises questions concerning the ceiling of both Blumhouse and the horror genre. Since 2019, scary movies rank as the seventh-highest-grossing format, capturing a meager ~6% of the overall box office.

Can horror producers like Blumhouse grow the genre to rival the market size of action, animation, and comedy, or is there a local maximum to the format's potential? And why aren't mainstream studios producing more scary movies? Much of this analysis has focused on relative returns (i.e. percentages). However, major studios like Paramount, 20th Century Fox, and Disney require absolute grosses in the hundreds of millions of dollars to delight their shareholders. Can horror reliably achieve these returns, or will the genre remain forever niche?

Furthermore, the format succeeds in fostering community during an era when moviegoing often feels solitary and transactional. Little compares to the shared suspense of an audience during a horror film. One of the first tense scenes in Jordan Peele's Get Out features a near-robotic groundskeeper inexplicably running wind sprint by moonlight as if possessed.

I'm curious where the line is between "horror" and "monster" movies. When does the make-up for vampires, werewolves, and whatever other beasties raise the investment budget up into "sci-fi" or "fantasy" or other lower return genres?

Year-round standalone streaming channels: Streaming services such as Shudder, Screambox, and Shout Factory are exclusively dedicated to horror film consumption, providing consumers with limitless scary movie content for $6.99 a month\u2014a steep price for streamers that don\u2019t have Suits, Bridgerton, or Law & Order: SVU.

To date, The Exorcist has grossed over $441M worldwide on an initial budget of $12M\u2014a remarkable accomplishment for a movie that necessitated barf bags. Before The Exorcist, horror films were considered niche or \\\"B-movie\\\" material, laden with cartoonish monsters and sophomoric scares. The film's immense box office success showcased the genre's artistic and economic promise, demonstrating its potential for high returns and, more importantly, its relatively inexpensive production costs. 006ab0faaa

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