Hollywood's Got the Box Office Blues

July 4, 2005 — -- "Star Wars III" has been a hit this summer, so has "War of the Worlds," which has taken in more than $100 million since opening last week. But Hollywood is still in a serious slump this summer, facing its 19th straight week of declining ticket sales compared to last year.

Despite big stars and big action, the film industry can't seem to reverse the trend, and Hollywood executives are trying to figure out why.

In a recent poll conducted by The Associated Press and America Online, 73 percent of Americans say they prefer watching movies at home on DVD or video.

While some people told ABC they didn't want to deal with the hassles involved with going out, many more said they simply didn't want to spend the money.

"It's kind of hard to take the family out now that it's about 50 bucks," said one man.

The economic model for films has completely changed. Last year, movies in theaters grossed $9 billion while DVDs grossed $20 billion. The opening weekend of a film is increasingly becoming an advertisement for the DVD.

Almost half of those polled also gripe that movies are getting worse, and 69 percent say movie stars are negative role models for kids. Some are starting to wonder if stars' antics -- such as Russell Crowe's assault arrest and Tom Cruise's controversial comments about psychiatry -- are beginning to turn fans away.

Some studios are taking drastic steps to drum up business. Last week, AMC theaters across the country offered a money-back guarantee for people going to see the Crowe flick, "Cinderella Man," which has garnered good reviews but poor box-office returns.

But experts dismiss the theory that controversial behavior by stars like Cruise has anything to do with it

"The people who love Tom Cruise are going to go to his movies. Same thing with Russell Crowe," said Sonja Stepstoe, an editor at Time magazine.

Hollywood is still holding out hope for films like "The Fantastic 4" and "Charlie and the Chocolate Factory."