This article in the Economist echoes much of what we’ve been kicking around here for months:

NOVEMBER 20th saw the return of an old phenomenon: the sold-out cinema. “New Moon”, a tale of vampires, werewolves and the women who love them, earned more in a single day at the American box office than any film in history. The record may not stand for long: next month “Avatar”, a three-dimensional action movie thick with special effects, will be released (see picture). This film’s production budget is reportedly $230m, which would make it one of the most expensive movies ever made. “Avatar” will be a great disappointment if its worldwide ticket sales fail to exceed $500m. Yet it is a reflection of how things are changing in the media business that such an outcome is unlikely.

There has never been so much choice in entertainment. Last year 610 films were released in America, up from 471 in 1999. Cable and satellite television are growing quickly, supplying more channels to more people across the world. More than half of all pay-television subscribers now live in the Asia-Pacific region. Online video is exploding: every minute about 20 hours’ worth of content is added to YouTube. The internet has greatly expanded choice in music and books. Yet the ever-increasing supply of content tailored to every taste seems not to have dented the appeal of the blockbuster. Quite the opposite.

The article talks about Chris Anderson’s “The Long Tail,” which doesn’t seem to be playing out per expectations. While consumers continue to drill down into the world of content, seeking unusual and distinctive songs, books, and movies, the blockbuster mentality continues to grow, effectively knocking everything askew. And here is a possible reason why:

Perhaps the best explanation of why this might be so was offered in 1963. In “Formal Theories of Mass Behaviour”, William McPhee noted that a disproportionate share of the audience for a hit was made up of people who consumed few products of that type. (Many other studies have since reached the same conclusion.) A lot of the people who read a bestselling novel, for example, do not read much other fiction. By contrast, the audience for an obscure novel is largely composed of people who read a lot. That means the least popular books are judged by people who have the highest standards, while the most popular are judged by people who literally do not know any better. An American who read just one book this year was disproportionately likely to have read “The Lost Symbol”, by Dan Brown. He almost certainly liked it.

This explains why bestselling books, or blockbuster films, occasionally seem to grow not just more quickly than products which are merely very popular, but also in a wholly different way. As a media product moves from the pool of frequent consumers into the ocean of occasional consumers, the prevailing attitude to it—what Hollywood folk call word of mouth—can become less critical. The hit is carried along by a wave of ill-informed goodwill.

These days it may travel far. Blockbuster films, long among the most international of media products, are now more so. The leading studios have beefed up their foreign-sales arms and learned how to market films that open at roughly the same time all over the world. Sony has done particularly well this year, pulling in more than $1.6 billion in ticket sales from outside America, a record for the studio. Big films such as “2012” and “Angels and Demons” have earned roughly twice as much in foreign cinemas as in American ones.

“The hit is carried along by a wave of ill-informed goodwill.” Not possible? Check this out:

Although you might expect people who seek out obscure products to derive more pleasure from their discoveries than those who simply trudge off to see the occasional blockbuster, the opposite is true. Tom Tan and Serguei Netessine of Wharton Business School have analysed reviews on Netflix, a popular American outfit that dispatches DVDs by post and asks subscribers to rate the films they have rented. They find that blockbusters get better ratings from the people who have watched them than more obscure ones do. Even the critically loathed “Transformers: Revenge of the Fallen” is awarded four stars out of five. Ms Elberse of Harvard Business School has found the same of ratings on Quickflix, the Australian equivalent of Netflix.

So let’s see that movie studio checklist:

* Blockbuster movies make the biggest profits.

* Blockbuster movies travel best internationally.

* Blockbuster movies can spawn sequels and remakes.

* Blockbuster are judged by less critical moviegoers and therefore easier to please.

* Blockbuster movies spawn more opportunities for ancillary revenue (e.g., videogames, novelizations, toys)

Perhaps this blockbuster phenomenon – cutting against the supposed current of “The Long Tail” – is one of the reasons for this:

The bottom hasn’t dropped out of indie filmmaking, but the ?middle has, and that’s even worse.?

That’s writer-director Noah Buschel’s take on how the? recession has impacted independents. Talking about his post-9/11 film noir ?”The Missing Person,” opening Friday in L.A. via Strand Releasing and ?already playing in New York, Buschel says $2 million pictures like his are ?an endangered species.?

The old model of selling small films for big money at festivals, Buschel ?points out, no longer works.

“We weren’t at Toronto, but from everyone I’ve heard from it was kind of a?massacre. I think one film sold at Toronto.”?

Budgets of $5 million, which once defined the midrange indie, are now ?largely history: $2 million’s the new $5 million, and it’s very tough to? raise.

But with digital technology, it’s easier than ever to make a movie, right?

“People can just go out and shoot stuff for $50,000 or $100,000 because the? equipment’s so great,” he told me. “But I like to make movies with actors ?and not with friends.”?

Mini-budgets make for quite different movies: “It’s very hard to? make something for $100,000 that’s cinematic. It’s easy to make something? where people are talking in a room.”?

Let me summon up my inner Don Quixote and make this prediction: The next decade will see a renaissance of indie films. We’ll still have blockbusters, but there will be alternate routes for distribution, digital portals like YouTube, that will create a sustainable model for smart, creative filmmakers to write, direct, and produce a wide variety of stimulating and compelling ‘smaller’ movies.

Your thoughts welcome.

H/T to James Tichener who sent me the Economist article via email.