'Found-footage' movies are so successful, it's scary

• 'Paranormal Activity 4,' the reigning franchise of found-footage fright, hits theaters Friday
• 'Paranormal' franchise averages $99 million per movie domestically
• No 'Paranormal' film has cost more than $5 million to produce

LOS ANGELES — What's scarier than a ghost in your attic? One that's out of focus.

"Found footage," the jouncy, documentary-like style of filmmaking that's become the hottest device in horror since gore, returns with a shaky vengeance Friday in Paranormal Activity 4, the latest in a franchise that has become the reigning king of fright films.

And if the previous three installments are any indication, the box office results could be scary.

Despite entering its fourth low-budget incarnation (the first film, in 2009, cost $15,000), Paranormal shows no sign of normalizing at theaters: Last year's third installment grossed $105 million, a significant leap from the $85 million gross of Paranormal Activity 2 in 2010.

Analysts expect a debut of at least $35 million for the new entry of the series, which they say has changed the way Hollywood views horror. While distributor Paramount Pictures has not released the production budget for Paranormal 4, no film in the series has cost more than $5 million (Paranormal 3). Still, the franchise averages $99 million per movie domestically, according to Box Office Mojo.

"It's true guerilla filmmaking," says Jeff Bock, chief analyst for box-office trackers Exhibitor Relations. "Paranormal Activity has made it hard for a studio to rationalize spending more than $20 million for a movie."

Because found-footage movies rely on consumer-grade cameras and no-star casts, "there's a creepiness to it that audiences are loving," Bock says. "The amateur video element makes it feel like it could happen to anyone. It's reality TV for the movies. I don't think we're even near the saturation point yet" for stories told through the lenses of smartphones, Super 8 cameras and laptop webcams.

Indeed, the genre is hotter than a new iPhone. Last week, the $3 million Ethan Hawke horror film Sinister opened to $18 million.

Recognizable actors aren't the only ones joining the jouncy fray. Barry Levinson directs Nov. 2's The Bay, a found-footage thriller about a small Maryland town caught in the middle of an ecological disaster.

Paranormal 4 directors Henry Joost and Ariel Schulman, who also directed the previous chapter, say the success of the franchise and genre still surprises them. Paranormal continues the saga of the mysterious Katie (Katie Featherston), a troubled mother who literally can't shake her demons.

"The success of the third film wasn't anticipated at all," Joost says. "Normally, there's a drop-off in the third film (at the box office). But if the scares feel authentic, the audience will still get on that roller coaster."

To make the ride as rickety as possible, Joost and Schulman walked around through homes that would serve as sets, looking for anything that could creep out moviegoers.

"You walk around the house, playing with things, talking out what would give you that chill in the middle of the night," Schulman says. "Sometimes the scariest feeling is that simple chill that someone is in the house."

The directors bought cameras off electronics-store shelves and washed out some scenes to give them an unpolished look. "It's an exciting time for found footage. There are still a lot of avenues to be explored, especially in non-horror," Joost says. "And it's cheap enough to be accessible for just about anyone."

Good found-footage horror, Joost says, follows simple principles:

• Forget cinematography. Cameras can jump and story lines can jumble in found-footage movies. "The genre coincides nicely with the popularity of YouTube," Joost says.
• Keep it cheap. "Don't spend more on video equipment than your character would," he says. "It needs to look homemade."
• Cut your makeup budget. "Make sure the boy's hair is a mess and the actress doesn't have on makeup," Joost says. "Pimples are good. Nothing takes you out of a movie like seeing a character get out of bed who doesn't look bad."

And don't let found-footage movies' basement production values belie their power, Bock says.

"Paranormal is the franchise that killed off Jigsaw," the recurring villain in the graphically violent Saw franchise, which spawned seven films. "Until they come up with something scarier than a noise in your bathroom, I don't think we'll see the popularity dying off soon."