How horror became the new new black. Again.

Everything in Hollywood goes through cycles. The reason is because the themes and stories (romantic comedies, vampires, westerns, fairytales) can be told using new techniques (3D, CGI) to a new audience who was still in nappies the last time it was in vogue.

One of those is horror, but it's enjoyed a longer upswing in recent years than many. The 80s and 90s weren't a good time for horror, but The Blair Witch Project seemed to make it a genre tailor made for the kids of the web age. As teenagers we all like to be scared, and suddenly the world offered a host of tools to make scary movies ourselves – what else is the unkillable found footage subgenre all about?

Torture porn and remakes of classic slasher movies have all got shots in the arm (and head) as a result, and there's a new breed of Hollywood exec as a result.

Look no further than Blumhouse Productions for the model. Jason Blum, 44, wields a unique in-house style to making movies that includes no star trailers, union scale pay, short schedules and profit sharing. When he spends chump change ($15,000 on the original Paranormal Activity, $5m for Insidious Chapter 2), kids at multiplexes return it five, 10 and 20 fold.

In fact the New York Times reported that spending $27m on production in the last five years had reaped box office of over $1bn for the company of only 15 employees.

Of course, horror is only hot because it's hot, a gravy train that'll run out like every genre and movement since the invention of the movies. Maybe in the 2030s an aging Jason Blum and his audience will remember the roaring days of yore when the cinemas flowed with bloodstained gold.

In some ways, horror is the angel investment money from which Blum and his contemporaries are planning other things to spring. The company's first comedy production starring Chris Pine is coming soon. Blum is also expanding into TV. His is one of the second-tier micro-studios standing to reap the rewards of Video on Demand as it becomes a force to be reckoned with in Hollywood.

It seems that horror has the capacity to change the business like few other genres. It prompted the video nasty outcry of the 1970s and 80s that further cemented the popularity of the VCR. Before that it was a reflexive expression of social horrors (like the Godzilla and the giant ants and spiders of the atomic age), and before that it represented the golden age of the studio system at its finest because of films like Dracula and Frankenstein. Now it's set to both piggyback and steer the new media age of small screens, anywhere content and the urgency of the first person POV from the world of gaming.

And aside from everywhere else, it's the only genre you can spend a million and get back a hundred million.