Really, the Oscars were supposed to be dead by now.

The Academy Awards ceremony was supposed to have withered away, a victim of its own irelevance. The Oscars were supposed to have been done in by studio blockbusters, the Internet, video games, the demise of film criticism, the closing of the art houses and most of all, by their own snooty elitism and arcane standards. The annual show was supposed to have been killed by the Academy's own insistence on ignoring popular taste to award obscure indie movies and its refusal to stop shining a spotlight on the obscure, boring technicians whose job it is to make movie stars look cool.

And yet, the Oscars have not only refused to slink off into the woods to die, they're actually doing better than they have in years. After a long decline, the show's ratings bounced back in 2010 to its biggest audience in five years. Ad sales rates for 30-second spots during the 2011 Oscars are back up to pre-recession levels. And of the 10 Best Picture nominees, at least seven are bona fide hits, with potential viewers excited to see whether sorta-hip young hosts James Franco and Anne Hathaway will oversee victories for such popular favorites as 'The King's Speech,' 'Black Swan,' 'True Grit' and 'Inception.' How did an institution supposedly at death's door bounce back into such robust health?
There are a lot of reasons. The most obvious is a move widely criticized at the time it was made two years ago: the expansion of the Best Picture field from five nominees to 10. At the time, some critics complained that this would dilute the quality of the awards pool. Others, however, recognized that the Oscars had strayed too far from popular taste, and that there were some blockbuster movies that were as worthy of recognition as the art-house films the Academy had been favoring of late.

After all, conventional wisdom has it that people only watch the Academy Awards show when they have a strong rooting interest in at least one of the Best Picture nominees. The show drew huge numbers the years that 'Titanic' and 'The Lord of the Rings: The Return of the King' swept the awards. But in recent years, the Academy had favored such worthy but not widely seen movies as 'No Country for Old Men' and 'Slumdog Millionaire,' and the show's ratings had suffered accordingly.

In 2008, Christopher Nolan proved with 'The Dark Knight' that a summer blockbuster could be a substantive movie worthy of top awards consideration. (More importantly, to the studios, he proved that he could get summer audiences to turn out in droves for a movie that was as bleak and brainy as any indie production.) Yet the Academy declined to recognize 'The Dark Knight' in major categories, with the notable exception of Heath Ledger's supporting performance. It was after that snub that the Academy decided to widen the playing field.

The first supersized crop of Best Picture nominees last year seemed to validate the strategy. It helped that one of the nominees, 'Avatar,' was the top-grossing movie of all time, though given its stunning technical and visual achievements, it's hard to argue that 'Avatar' didn't earn a nomination on merit and not just popularity. That gave the 2010 show a huge rooting interest -- that and the narrative pitting James Cameron's mega-hit against Kathryn Bigelow's tiny underdog movie 'The Hurt Locker.' (Call it Goliath-vs.-Goliath's-Ex-Wife.) Sure, the smaller, barely-seen movie won again, but the inclusion in the field of genre hits like 'District 9,' an animated hit like 'Up' (only the second cartoon ever nominated for Best Picture) and a broadly populist feel-good drama like 'The Blind Side' made the point that the Oscars had broadened their horizons and weren't going to penalize movies for being successful.

If anything, this year's 10 nominees are an even stronger bunch. There are two huge blockbusters -- 'Toy Story 3' (2010's biggest hit) and Nolan's 'Inception,' -- but both earned near-unanimous critical acclaim in addition to selling at least $290 million worth of tickets. Other big hits up for Best Picture include 'True Grit' ($160 million and counting), 'Black Swan' (just over $100 million at press time), 'The Social Network' (just shy of $100 million), 'The King's Speech' ($94 million and counting) and 'The Fighter' ($86 million so far, with a good shot at making it to $100 million). Only three of this year's movies are little-seen indies: 'The Kids Are All Right' (which earned $20.8 million, very good for an art-house film), '127 Hours' (not well-seen but well-publicized, with a Best Actor nominee who's also the Oscar co-host) and 'Winter's Bone,' featuring rising starlet Jennifer Lawrence.

Seven of these movies are hits, and yet it's hard to accuse the Academy of making concessions to popularity just to drive up the rooting interest in this year's nominees. These are all critically acclaimed movies; there's not one for which a Best Picture win would look like a weakening of standards.

It's also worth noting that, for the first time in years, the studios are back in the Oscar game they had once all but abandoned to the indies. For a long time, it seemed that the studios had stopped making mid-priced dramas for grown-ups, the sort of prestige movies that usually win Oscars, because there was no money in them. This year, however, five of the 10 nominees come from big studios, and three of those ('The Fighter,' 'True Grit' and 'The Social Network') are big hits made on modest budgets. It seems as if the studios are beginning to figure out how to make prestige movies on a budget and market them into hits. Which means that the Academy should continue to be able to stock the Best Picture field with movies that are popular as well as good.

There are other reasons for the resurgence. The advertising market has picked up, allowing ABC and the Academy to demand a whopping $1.7 million per 30-second commercial, as they did back in 2008. The hiring of Franco and Hathaway is an obvious ploy to lure younger viewers, and as Franco says, "Duh, is that a bad thing?"

True, not everything in this scenario is rosy. The Oscar show itself can still be long and dull. The technical awards (Best Sound Editing, et al) that send viewers running to the bathroom aren't going anywhere, as the constituencies that make up those parts of the Academy are large and will continue to demand their one annual moment in the spotlight. And even in a year with so many big hits, the distractions of other media have made it hard for one or two movies to dominate the national conversation in a way that makes for a compelling Oscar-night narrative. ('Avatar'-sized phenomena don't come along every year, and 'The King's Speech' vs. 'The Social Network' isn't the kind of bitterly fought rivalry that, say, 'Crash' vs. 'Brokeback Mountain' or 'Forrest Gump' vs. 'Pulp Fiction' were.)

The Oscars may never again be as huge as they once were, but they're still at the top of the mountain. Most people on Earth would still rather win an Oscar than an Emmy, a Grammy, a Tony, a Heisman Trophy, a Nobel Prize or any other award you could name. So as long as the Academy can continue to balance the awards' newfound populism with the prestige that comes from maintaining high standards (there's a reason an Oscar is more coveted than a Golden Globe or a People's Choice Award), the Oscars should be in decent shape for years to come.

Follow Gary Susman on Twitter @garysusman.
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