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It isn't the terrible economy - yet. People are still going to movies. The big problem is Wall Street. Without money from private equity and big investment banks, which injected an estimated $10 to $18 billion into Hollywood in the last four years, studios have had to change the way they do business - fast.
As financing costs escalate, so will production costs. That means fewer films. Though the reduction ripple won't hit the box office until 2010, the number of productions will be down 5 percent to 10 percent over the next few years, predicts Vogel. The total number of feature films in wide release climbed from 478 in 2000 to 631 last year, a 32 percent increase. The number of movie tickets sold increased by only 1 percent in that same period.
Originally posted by eldard