The Chicken Little metaphor isn’t mine. It comes from veteran independent film exec Mark Gill, who gave this speech citing dire conditions for the art-house movie business: the shuttering of such indie shingles as Picturehouse and Warner Independent; the absorption of New Line and Paramount Vantage by their parent companies; rising production and advertising costs, the drying up of financing from investors outside the industry, a bottleneck in distribution that results in most indie-made films going unseen, and competition for attention with mainstream movies that have 100 times the promotional budget and distribution muscle.

Less pessimistic, however, is Philadelphia Inquirer film critic Carrie Rickey, whose essay went online the same day as Gill’s speech. Her sanguine assessment: Don’t worry, innovations in distribution (Netflix, legal downloading, on-demand cable, even releasing films in theaters and on DVD the same day) will save the indie business. Besides, things just look bad right now because we’re in the annual summer slump; indie films will flourish again in the fall, when prestige pictures are released in order to appeal to Oscar voters.

So, which is it? I don’t find Rickey’s argument as persuasively written as Gill’s; dismissing the empty seats in art-house theaters right now seems to miss the larger picture. We’ve already seen the foreign-film audience dry up to nothing (thanks in part, ironically, to the American indie boom of the ’80s and ’90s), and similar neglect could easily starve the rest of the alt-film business. Maybe the home-distribution alternatives she outlines will work, but that still means the art-house business, and the experience of seeing these movies in theaters, is dead.

Nonetheless, I think she’s right, that the industry can survive, albeit in some new, unimagined form. For one thing, the problems Gill cites (except for competition with the major studios) are all problems for the majors as well. The whole American movie industry is going to have to figure out a way out of this dilemma, and that lifeline could save indie film as well. In order for that to happen, however, there’ll have to be a major shift in the mindset of Hollywood; it’ll have to want to save the indie business. Right now, the majors are trapped in a mindset that would rather risk $300 million to earn $600 million (on a typical action blockbuster) than risk $4 million to earn $20 million (for an indie project), even though the entry cost, total cash risked, and return on investment (as a percentage) are all better on the indie side. There’s no reason the big studios can’t be making both kinds of movies, but they’ll have to commit their vast marketing and distribution resources to make it work. Hits like Juno and Little Miss Sunshine prove there’s a large audience out there for movies with an indie sensibility; it’s time for Hollywood to stop dismissing that audience — the audience that loves big comic-book spectacles but also movies that are about more than just popcorn fun — as a niche.

What do you think, PW-ers? Is the indie-film business dying or on the verge of reinventing itself? Or is the indie biz a canary in the coal mine whose symptoms indicate bigger problems for all of Hollywood? And what should be done to fix them?