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The Business of the Oscars

Published onFeb 26, 2017
The Business of the Oscars

The Academy Awards for the film and entertainment industry are Sunday, February 26, and after La La Land netted a record-tying 14 nominations in mid-January, its win for Best Picture seems inevitable. But La La Land has just as many fans as it does detractors. The detractors have many axes to grind but a common criticism is that a La La Land victory will perpetuate a larger, engrained problem: The Declining Business of the Oscars.

The Academy Awards have seemingly never been about the merits but about politics – the best movies of the year may not be nominated and certainly may not win. But best movie is, of course subjective. What is more objective is the economic impact of the films in the Best Picture race on the films themselves and the industry as a whole.

There is a well-known, recurring segment from Jimmy Kimmel Live! the last few years where random Los Angeles citizens are questioned about the films nominated for Best Picture on the eve of the awards ceremony and most have not seen any of the films and often fall for fake movies that do not exist. Of course, the statistics bear this out as well as a recent survey showed that 60% of Americans cannot name one Best Picture nominee.

This has to be particularly alarming for an industry that specifically changed the rules for Best Picture in response to widespread alarm that certain popular blockbusters were not nominated for Best Picture. In 2008, The Dark Knight was massively successful but was only nominated for Heath Ledger’s supporting performance and many technical categories. Due to industry outcry and angry editorials, the Academy changed the rules to nominate 10 films for best picture instead of 5 and adopted a preferential balloting system that favors wide-spread Academy support over sheer number of first-place votes.

The following year, the changes seemed to have the desired effect as the then-most successful box office film of all-time Avatar was nominated for several Academy Awards including Best Picture. However, the ultimate winner, The Hurt Locker, was the lowest-grossest movie to ever win Best Picture. While the ratings for the broadcast were up in 2009 arguably for Avatar being nominated, in the following year the ratings declined again precipitously, perhaps an impact of The Hurt Locker winning more than a reflection of the slate of nominees which included successful and popular movies like Inception and Toy Story 3.

The Academy has seemingly settled into this comfortable narrative of avoiding crowd-pleasing blockbusters for the small, independent passion project to its own peril. In 2015, American Sniper set box office records, earned 6 nominations, and grossed more than all of the other Best Picture winners combined. But when the envelope was opened, Best Picture went to the more idiosyncratic Birdman and Oscar ratings were down again, the lowest in four years.

Last year, despite Star Wars: The Force Awakens smashing the all-time domestic box office record, the Academy did not nominate the prodigious blockbuster and ratings were the lowest since 2008.

This year, despite calls to nominate the popular and iconoclastic Deadpool which was nominated for several Golden Globes, the Academy gave no nominations to Deadpool and only 2 nominated films, Hidden Figures and La La Land,were in the top 20 in box office gross last year.

Despite all of this, this year’s Oscar ad revenue is up from last year and remains second to only the Super Bowl in terms of bringing in advertising dollars, though the going rate is likely shaped more by the political climate and expectations of speechifying more than by consumer anticipation for the awards themselves.

But the long-term economic health and relevance of the Oscars could depend on a few surprises and a long shot upsetting La La Land in the Best Picture race. Stay tuned.

Jacky Brammer is a second-year law student at Wake Forest University School of Law.  He holds a Bachelor of Arts in American history and English from The University of North Carolina at Chapel Hill and a Master of Arts in English literature from The University of North Carolina Greensboro.  Upon graduation, he intends to pursue a career in public interest law and criminal defense.

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