Hollywood Going Bust: 50% of Studios May Close

The number of films being produced by Hollywood is set to fall by more than a third as the major studios struggle against a twin threat, industry analysts say.

Their problems stem from a dearth of funding and from the digital revolution in the way people consume moving images.

Mark Gill, head of the Film Department, an independent film finance firm, predicted that last year's peak of 606 films to emerge from Hollywood would fall to fewer than 400 next year "and it may go lower than that in future".

The finances are in freefall, Gill said. In the wake of the financial meltdown, banks that had acted as the main funders of big- and middle-budget films have withdrawn their largesse, sucking $12bn (£7.4bn) out of the $18bn available to the top studios.

Other lines of income have also shrivelled, most importantly DVD sales, which have plummeted by up to 25% in some studios, partly as a result of piracy.
(snippet)
He told the Bloomberg news service that "it's a period of incredible change", predicting that two or three of the six big Hollywood studios were under such strain they would soon go bust.

That gloomy prognosis chimes with other industry analysts who claim that MGM in particular is on the edge, while other big studios are not far behind. Paramount Pictures registered a loss of almost $150m in the first half of this year.
LINK HERE