The success of 'The Backrooms,' which grossed over $300M on a micro-budget of $10M, has triggered a Hollywood scramble for internet horror rights. Amblin, Steven Spielberg’s production company, and Amazon MGM have secured the rights to the YouTube horror series 'The Mandela Catalogue,' while Warner Bros. has picked up 'Siren Head.' Low-cost, creator-led IP is rapidly emerging as the next big box-office formula.

Internet horror stories born on YouTube are capturing Hollywood's attention. Recently, Steven Spielberg’s Amblin Entertainment and Amazon MGM Studios secured the film rights to the YouTube horror series The Mandela Catalogue. According to Deadline, the deal was finalized after a fierce bidding war involving 11 different studios. While Spielberg will not direct, the original creator, Alex Kister, is set to helm the project.

The Mandela Catalogue, which premiered on YouTube in 2021, follows the story of shape-shifting entities infiltrating the fictional Mandela County in Wisconsin. With over 100 million cumulative views, the series has built a dedicated fanbase through its uniquely bleak and surreal atmosphere. The decision to keep the original creator as director mirrors the approach taken with The Backrooms, which retained its YouTube creator, Kane Parsons, as director.

Around the same time, Warner Bros. Pictures also made a move. According to The Hollywood Reporter, Warner Bros. won a bidding war for the film rights to 'Siren Head,' an internet monster created by creature designer Trevor Henderson. Siren Head is a creature featuring two large sirens in place of a head. Warner Bros.' commitment to the project is reportedly driven not just by the Backrooms craze, but by the involvement of Zach Cregger, director of Weapons and one of the most sought-after figures in the horror genre today.

The epicenter of this IP rush is undoubtedly The Backrooms. Distributed by A24 last May, the film was produced on a budget of less than $10M and went on to gross over $330M worldwide. It set a new record for A24’s biggest opening, pulling in $80M in North America and $118M globally in its first weekend alone. Parsons, who was 20 at the time, became the youngest director to helm a No. 1 box-office film. The achievement—becoming A24’s highest-grossing film in just four days and crossing the $200M mark—is seen as proof of how powerfully internet-born IP can translate to the big screen.

Following the massive success of 'The Backrooms,' Hollywood's hunt for intellectual property has shifted toward internet memes. Online communities have become the new frontier for IP discovery, with reports even surfacing that studios have begun scouring Reddit in search of their next big hit. This explains why industry titans like Spielberg and major studios like Warner Bros. are so quick to snap up internet urban legends. Their strategy is simple: acquire memes or series that already have a proven fandom, provide the original creators with the necessary capital, and bank on their success.

At the root of this trend is the slowing momentum of established franchises. As younger audiences show less interest in long-standing, reliable giants like Star Wars or the Marvel Cinematic Universe, studios are focusing on finding new formulas to open wallets. This is similar to the reason why game-based adaptations continue to be a steady source of films and animation.