When I was a kid, movie theaters had another name in my family… day care.

During the summer months, my dear mother - who owned a cute little restaurant called “The Birdcage Tearoom” - would drop my sister and me off at the little two-screen theater down the road and go work the lunch and afternoon tea rush.

She’d buy us each a ticket to the first screening, give us a little money for popcorn and candy, and head to work. My sister and I would just watch the same movies, over and over again… going back and forth between the two screens. I know, I know… we should’ve paid for each showing. Hey, we were kids… what did we know? But, ya know what? It’s one of the best memories of my childhood. It was in those days, sitting in the dark theater, eyes opened wide in amazement, that I fell in love with movies.

It wasn’t until years later that I understood why my mom did it. She had to. We were broke. See, times were tough. There was a massive recession going on and my mom had a huge Small Business Administration loan to repay. The reality was, day care was simply not an option.

So, the movies were our baby sitter. A refuge and a joyful distraction from the stress going on in our world.

The entertainment industry has many so-called “truisms.” Age-old axioms that are generally accepted as ironclad facts. When I began my career, one of the first “truisms” I heard was that entertainment was “recession-proof.” The logic is that when times are tough, people need an escape. And entertainment is a cheap way to shut out the world and just be taken away from your troubles for a little while. There is some decent historical data to support that idea.

But today, as we face a dizzying barrage of economic tumult, the question is - will entertainment, once again, be recession-proof?

Now this is just my two cents (although with inflation it may now be four cents), but my answer to that question is:

No… and yes.

Let me start with the bad stuff. The studios, streamers and cinemas were already facing massive headwinds. A lot of this I have pointed out before, but it bears restating in this context.

Theatrical: Even with last weekend’s big opening of the Minecraft movie, 2025 box office is still shaping up to be below pre-pandemic levels. Going to the cinema is an expensive, high-friction endeavor. While many customers still say they are willing to go, they complain about the quality of the offerings. Even before this current madness, consumers were saying that it takes a LOT for them to leave the house, buy tickets for the whole family and overpay for popcorn, candy and soda. Will that get better as budgets tighten? Tough to say.

Streamers: Since 2019, streamers have seen a 400%+ increase in the number of subscribers who jump from service to service to watch the movies or shows they want to watch: they subscribe, watch, cancel and move on. Gone are the days of putting your credit card down and forgetting about it. That level of churn is wreaking havoc on subscriber-based platforms that rely on steady, or better yet, growing subscriber numbers each quarter. There is plenty of reason to assume this would only increase in an economic downturn.

Studios: The costs of making movies, and perhaps more importantly marketing them, continue to go through the roof. And worse yet, the once reliable, IP-driven franchises have been underperforming. Fewer movies and shows are being produced. More is being spent and revenue is often coming in lower than expected. In fact, the big studios have seen their net income decline by over 60% in recent years. If revenues begin to fall, the likelihood of this trend continuing may go up.

It could easily be argued that, for the big players, these already worsening trends could actually be accelerated by an economic downturn this time around. But, now there is one other wild card.

Over the last decade, China has become more and more important for big-budget Hollywood films. Even as China’s entertainment industry has been ascending lately, taking more of the overall pie, studios still count on China to add significantly to their global box office numbers. While Trump is vacillating on some of his tariffs, the massive tariffs he levied on China haven't been paused. Ironically, the only US product exported to China that enjoys a surplus is entertainment. And you will not be surprised to learn that China is now threatening to shut that spigot off. When the difference between a big budget film being successful or the execs behind it dusting off their resumes may be just a couple of percentage points, losing such a massive market would be catastrophic.

Not sure I would go so far as to bet against the big industry players. They are super smart, still have tons of resources and many could, at worst, just weather the storm and come back to fight another day. But, if they need to go into a defensive posture, you could certainly see more layoffs and even fewer movies and shows being produced by the big players.

That, to me, creates a window of opportunity for Indie Film & TV creators.

Hollywood projects - thanks to massive production costs, marketing costs, infrastructure and overhead - require their projects to have incredibly high returns to be profitable. But where Hollywood must rely on their projects “hitting a home run” every time, Indie Film and TV producers can play “Moneyball.” For those not familiar, Moneyball is a reference to the Michael Lewis book about a major league baseball team who used data to identify the players for their roster. What the data showed was, rather than spending top-dollar for high-profile, flashy players, they should focus on players who simply, “get on base.” The logic is pretty simple: players who may not have a million dollar bat, but know how to work a pitch count, know how to keep the ball down and shoot it into the gap… they get on base. And if you have a lot of players who get on base, by definition, you have a better chance of winning the game.

That’s what Indies can do.

It used to be that Indie films and TV shows would look smaller, because - well - they had smaller budgets. They were more contained. Fewer locations. Not a lot of sets. Smaller casts. Less well-known talent. But that, among many other things, is changing.

Here are some thing Indies can take advantage of now:

* High-profile talent are much more interested in making Indie films and TV shows, these days. I’ve referenced this before, but when you have prominent talent like Mark Ruffalo, publicly encouraging his fellow stars to “jump into indies…” that’s a good sign. There are lots of reasons they are wanting to do this, of course. And one of them is the desire to, exit the “empire of billionaires” at studios, as Ruffalo says. But, there is also the fact that there are fewer films and shows being produced at the studios and streamers. And that may only get worse. Stars are looking to work. This could make it a great time to bolster your cast with well-known talent.

* Indies can focus on niche audiences. Rather than needing a project to have mass, so-called “four quadrant” appeal, Indies can “narrow cast.” Not only does this work to more effectively target the audience that is most likely to watch, but the resonance of the story to that particular community, makes them more likely to share it with their friends and family.

* Indies can utilize the power of the exploding Creator Economy to build marketing energy around their project. Now, lots of filmmakers I speak with bristle at this notion. I get it. Making a movie or show is hard enough. And now filmmakers are expected to be social media creators as well? The answer is simple. YES. This is the new world we live in. I have said this before in this newsletter/podcast. But, it bears repeating. The most successful Indie filmmakers of the future will be “multiprenuers.” Artists who embrace the tools and techniques that make the Creator Economy so effective at building community to build an audience for their film, even as its being made. I tell every filmmaker I meet to embrace their storytelling skills to create short-form, episodic videos about their day to day process. Create cliffhangers. Make people want to come back for more. By the end, you may just build an army of fans who are not only anxious for your project to come out, but are willing to spread the word. That’s the most powerful, virtually free, marketing in the world.

* With the amazing, fast-paced evolution of AI tools, Indie filmmakers are no longer necessarily limited to small, contained worlds. It’s not going to need to be used on every film of course. But, the idea of being able to make a low (or even micro) budget animated film, or a sci-fi film set on another planet, without spending the millions of dollars it would have cost even just a few year ago, is an absolute game changer.

* With new platforms offering direct-to-consumer distribution solutions, Indie films are no longer stuck having to deal with the old network of middlemen who make profitability virtually impossible. This isn’t about just throwing your project on a website and hoping people show up. No, this is a specific strategy, utilizing all of the elements we have already discussed, to get as many people as possible excited to pay to watch your project. But instead of watching on somebody else’s platform, where they take most of the money, you do it on a platform that gives you tools to help you and your community market the movie and gives the majority of the revenue back to you. Then, after its initial release window, you can license the project to other SVOD, TVOD and AVOD streamers. And the better the project did in its initial release, the higher your license fees may be on those deals. It gives you the best of all worlds. And, as a huge added bonus… you still own your IP.

All of this adds up to the ability to make high-quality films and shows, while still keeping costs low, making the possibility of profitability more attainable. By focusing on “getting on base” rather than making projects that can only succeed if they are a massive hit, you increase the likelihood of your financiers recouping… or maybe even returning a profit. Which means they may be more likely to invest in the future. And if you recoup faster, a project that takes off is even more profitable for everyone.

And all of this can happen, even in a difficult economy. In fact, I would argue, it has a better chance of working than the bigger budget movies. Of course, time will tell.

Look, I know this is a lot to take in. But I hope you feel, as I do, that even in the midst of a seemingly unrelenting wave of chaos and uncertainty, the future for Indies is bright.

Let me know what you think!

#indiefilm #creatoreconomy #entertainment #AI

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