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What's An Oscar Worth?

Oscar Awards
AP
Oscar Awards

All of Hollywood covets those shiny gold statuettes.

And there's no question that winning an Oscar can transform a young actor or writer's career.

Of course movie studios love bragging about their Oscar wins, but what an Oscar means to a movie studio is much less clear, and it varies a lot more depending on the film.

"Avatar" from 20th Century Fox has snagged nine nominations and is considered a front-runner for Best Picture. But "Avatar" is already so huge, on track to beat "Titanic" with the biggest box office of all time, that it wouldn't see any revenue boost from winning Best Picture.

But Oscars can have a huge effect on smaller movies: the less successful the film when it's nominated or wins, the bigger the impact. "Hurt Locker," from Summit Entertainment is also a front-runner for Best Picture, but it's at the opposite end of the spectrum from "Avatar": it's grossed less than $13 million in the U.S. And less than $20 million worldwide.

"Hurt Locker" can't get a box office boost because it's already out on DVD, but Oscar attention has already transformed its home video fortunes. Revenues have soared since its nominations, and its sold some 710,000 DVDs and digital downloads. These numbers are what you'd see for a much larger movie- "Hurt Locker" has exceeded all expectations based on its box office.

A best picture win can boost home video revenues as well as box office as much as forty percent, according to Hollywood Industry economist (and Columbia professor) Harold Vogel. For smaller niche films like "Precious" which are still in theaters, a Best Picture win could mean a healthy box office boost.

But Vogel cautions investors not to make long term bets based on Sunday's winners.

For one thing, the cost of winning an Oscar and the revenue it brings in is often a wash. Studios often spend tens of millions of dollars to promote Oscar contenders to Academy voters and the industry. And just because a studio sweeps the Oscars one year doesn't mean they'll be able to keep up its golden run. But Vogel does say a winning studio may see a brief boost during trading Monday morning.

But speculation might be better left to your office Oscar pool.

Questions? Comments? MediaMoney@cnbc.com

  • Working from Los Angeles, Boorstin is CNBC's media and entertainment reporter and editor of CNBC.com's Media Money section.