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Virtual Insanity

by M.G. Siegler


The Scarily Profitable Hits of Jason Blum

Ryan Bradley:

Horror movies occupy a special place in the hearts of producers. They are cheap, their fans don’t demand well-known actors and the ratio of risk to reward can be astonishing. “Night of the Living Dead” cost $114,000 to produce in 1968 and has since grossed at least $30 million; “The Blair Witch Project” cost $60,000 to produce in 1999 and has since grossed $249 million. Blumhouse’s own “Paranormal Activity,” shot in one house with two unknown actors and almost no crew, cost just $15,000, yet its box-office return since its 2009 release has been $193 million, a return on investment of about 1.3 million percent.

One. Point. Three. Million. Percent. 

Blum’s approach represents a particularly enterprising way out of the dilemma in which Hollywood finds itself in the age of endless “Transformers” sequels and “Spider-Man” reboots. A typical blockbuster can cost around $200 million, with another $100 million for marketing. At that rate, the studios can’t afford to make a lot of movies, which means the ones they do make can’t fail. This year Disney will release just seven movies, and all but one of them will be a sequel or a reboot. Blum, by contrast, makes a lot of movies on small budgets, and many of them never even go into wide release. Because the production cost is low, he can consider other options for movies that don’t seem likely to break big — ones that don’t require an additional multimillion-dollar marketing commitment but could still recoup the initial investment with maybe a little extra as well. Some Blumhouse productions appear on a few hundred screens, often targeted at narrow fan niches. Others might appear in a festival or two then get sold to a streaming service like Netflix.

When they zig, we zag. Brilliant maneuver to fill the niches traditional Hollywood not only overlooks, but just doesn't even care to see.


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