Fiscal cliff Failure will damage film industry in 2013

The looming fiscal cliff poses a great danger to the film industry in 2013 as middle income families will be forced to cut back on expenditure if taxes go up.

The film industry, and entertainment in general will suffer as people use their savings more wisely and avoid unnecessary expenses. Films and creative content will become less of an option as a result of reduced purchasing power. Families will likely reduce their outings at the cinema because of this. The whole economy will also face a downward spiral if purchasing power falls for a big proportion of the population, and entertainment will be the first thing people decide to cut down on.

What would you be more inclined to do on a tight budget? Save a few dollars to make the rent payment or head out out to watch a Disney blockbuster with your kids? Survival and bills come first.

In 2012, there were more than 650 movies that had theatrical distribution (Source: Box Office Mojo). This was a sharp increase on 2011 where there were just over 600 releases. There is a lot of choice at the box office, but if families and individuals are forced to cut down next year, smaller and mid-sized releases will be hit harder leaving just the big movies on track to retain their audiences. Now you can disagree with me on my analysis but if the film industry releases 650 films next year, and attendance falls, blockbusters might hold up, but other films, more arty, less accessible will have to compete for fewer dollars. It's an inevitable equation. Less money in circulation means less attendance at the box office and we are 2 days away from this disaster.

Congress needs to act right now, because failure to do so damages us all.