The First Great AI Movie Will Be a Horror Film

Hollywood’s new fear isn’t a monster, it’s a method, and it’s ready to be tamed by the right creative minds unbound by the constraints of tradition.

Frankenstein, Nosferatu, & Halloween Ends (Netflix, Focus Features, Universal)

“Good evening, and fuck AI!” That was the parting message Oscar-winning director Guillermo del Toro (The Shape of Water, Pan’s Labyrinth) gave to a private audience in New York on Oct. 18 as he left a Netflix screening for his new film Frankenstein, starring Oscar Isaac, Christoph Waltz, and Mia Goth. That phrase, now famously uttered by Ice Cube in the hit Apple TV series The Studio, has become a familiar refrain in some Hollywood circles.

Not long after his New York screening, del Toro sat for another interview with NPR, where he laid out his AI thoughts in a bit more detail. “AI, particularly generative AI — I am not interested, nor will I ever be interested. I’m 61, and I hope to be able to remain uninterested in using it at all until I croak,” said del Toro. “The other day, somebody wrote me an email, said, ‘What is your stance on AI?’ And my answer was very short. I said, ‘I’d rather die.’”

The director, known for his strict attention to detail when it comes to world building and special effects, has been keeping an eye on the development of AI video for several years and has remained unwavering in his stance against it. But these recent missives lobbed at the emerging technology seem a bit more urgent and pointed. That’s probably because the AI video tools have now, in just the last 24 months, advanced to the point where generating realistic humans, sceneries, ambient sound effects, and even dialogue have become far easier.

What seemed like a development that might take at least another five or seven years has suddenly crept up on an unsuspecting Hollywood creative community with startling rapidity, and no one seems ready to fully acknowledge what is happening, least of all successful traditional directors like del Toro. But we’re here. OpenAI’s Sora, Google’s Veo 3, Runway ML, and a growing list of Chinese AI models are delivering ever more convincing AI videos, producing realistic humans. And things are only accelerating.

The Back Door Into Cinema’s Future

Nothing peeking over the landscape of entertainment indicates that traditional filmmaking, nor the actors and crew that produce these films, will suddenly disappear overnight. In fact, these kinds of films may never disappear, even 20-30 years from now (and beyond). But what is obvious is that, beyond the very obvious realm of emerging AI animation, AI video is becoming good enough to begin making feature films.

The question is, what kind of AI films will audiences accept as the beachhead for this new kind of storytelling? I remain convinced that horror, with its embrace of the ethereal and supernatural imagery, is the perfect genre for the first big, live-action (well, virtually live-action) AI feature film.

However, now that we’re deep into my favorite time of the year, Halloween, and we’re all reviewing lists of our favorite horror films of all time, I think it’s time to be more specific. Sure, horror is the perfect canvas for the first major AI film, but what kind of horror film? Well, that gets a bit tricky, especially since horror is the second least-liked film genre among fans, according to a new survey of film viewers conducted by YouGov earlier this month. The most loved film genres are Comedy, Action, and Thrillers, while Horror sits much farther down the list, just barely more popular than Westerns.

Nevertheless, horror is big business. And it can sometimes deliver the biggest profit margins of any genre when produced on a shoestring budget. Paranormal Activity (2007) cost just $15,000 to produce and went on to earn a staggering $193 million at the box office. Similarly, The Blair Witch Project (1999) only needed $60,000 to ultimately pull in $248 million. And more recently, Insidious (2010) used just $1.5 million to rake in $100 million. So yes, horror isn’t the most popular film genre, but when you land a winner, it outperforms its production budget better than any other kind of movie.

Paranormal Profit Margin

Part of the promise of AI filmmaking is the reduction of production costs. So the idea of taking an already budget-friendly genre like horror and dramatically reducing costs even more with AI will probably be irresistible to many producers and directors. So, back to the question of what kind of horror movie might work best for the first major, live-action AI feature film hit. Another look at the YouGov survey reveals that the top three horror subgenres among theatergoers are psychological horror (think Get Out, Midsommar, Hereditary), comedic horror (Scary Movie, Shaun of the Dead, Army of Darkness), and paranormal horror (The Exorcist, The Conjuring, Insidious, Sinister, Talk to Me).

Of those top three horror subgenres, one stands above the rest: paranormal horror. According to a related YouGov survey, also conducted this month, the most well-known horror film that has been seen by the most people across demographics is The Exorcist, a fairly barebones film about demonic possession. And since, as I’ve noted, the two best-performing films of all time in terms of budget-to-profit margin are Paranormal Activity and The Blair Witch Project, both firmly in the paranormal horror subgenre, we have our answer! If you are looking to make the biggest splash culturally, with the lowest budget, and the greatest potential profit margin, all of your efforts should be focused on paranormal horror stories.

Of course, this is all art. And in art, numbers aren’t always a rule, but more like a great suggestive road map.

In 2023, I screened the critically acclaimed low-budget ($15,000) paranormal horror film Skinamarink from Canadian director Kyle Edward Ball. And while I loved the aesthetic of the film, I’m sorry to say that I did not enjoy sitting through it as a piece of storytelling. Despite this, as I watched it, a very distinct thought popped into my mind: This is the kind of minimalist horror film that could be done using AI video tools right now.

That was nearly three years ago, while we were still in the age of AI-generated hands with six fingers and humans that looked like uncanny valley attempts at best and mushroom trip-fueled phantasms of the human form at worst. But those days are past us. I believe that, as of now, perhaps even in just the last eight weeks or so, AI video tools are now ready to tackle paranormal horror stories in a way that respects the genre and entertains audiences. Now we get to see if someone can use these AI tools to tell such a great story that when the public finally gets a look, the last thing on their minds will be how it was made, but rather if they’ll be able to go to sleep at night without leaving the lights on.