Will Movies Be Recession Proof?

Movie going has proven recession-resistant. But will this economic downturn prove different? A new Jupiter Research report finds 32 percent of adults online say they'll cut back on going to the movies.

But that's fewer than the people in this online group that say they're cutting back elsewhere; 63 percent say they're doing less driving, 60 percent are doing less shopping, and 60 percent are vacationing less. Players throughout Hollywood are hoping movie going will be considered an affordable respite from the depressing reality of the economic situation.

Back in 1929 after the stock market crash, people rushed to theaters; box office revenue was up 58.2 percent over the previous year. There were obviously some other historical issues at play then, so some recent recessions may be more revealing: During the 1991 recession box office revenue slumped 4.4 percent (according to Adams Media Research) though after September 11 box office rose 8.6 percent.

This fall the movie studios have some big bets, hoping familiar brands will perform both domestically and in the increasingly important overseas market, now comprising more than half of studios' box office revenue. Overseas box office revenue is $7.4 billion from the start of 2008 through September 28, compared to $7.5 billion last year. But Sony/MGM are releasing Quantum of Solace, the 22nd James Bond film overseas before it launches in the U.S. market. The movie is opening in France, the UK, and Sweden on October 31, but not in the U.S. until two weeks later.

Disney (DIS) is counting on a number of its films including Beverly Hills Chihuahua and High School Musical 3 to perform strongly throughout the holiday season. Fox International is putting a big push behind two tentpoles, a remake of The Day the Earth Stood Still, which rolls out starting December 10, and Australia from Baz Luhrmann, which rolls out around Christmas Day. Paramount (owned by Viacom (VIA)) is on track to reach $2 billion at the overseas box office by the end of the year. The film that should put Paramount's numbers over the edge, is DreamWorks Animation's (DWA) Madagascar: Escape 2 Africa, though DWA's ongoing deal to distribute through Paramount.

The fact that there are so many franchises, sequels and family-friendly films, should help the studios hold up over the holiday season. The big question remains how much movie going habits will be affected by the economic downturn and whether it could encourage more movie going, or whether consumers will really pull back.