Hollywood began dissecting the Academy Award nominations on Tuesday, with Martin Scorsese's "The Aviator" becoming an early favorite to win the Oscar for best picture. But the Howard Hughes biography will face tough competition from the Clint Eastwood-directed drama, "Million Dollar Baby."

Veteran entertainment analyst Harold Vogel of Vogel Capital Management says there is a reason why the studios pay so much attention to Oscar nominations and it's not just prestige. Nominated films often get a new lease on life at the box office, as well as for ancillary markets like DVDs.

Before founding his own venture-capital and trading fund, Vogel was senior entertainment industry analyst at Merrill Lynch. He has written extensively on the industry, including the book "Entertainment Industry Economics: A Guide for Financial Analysis."

Question: How important are the Oscar nominations to the companies that make the nominated movies?
Answer: It's prestige. It's library value. It's recognition in a broader sense for the individuals. The individual nominees are the primary beneficiaries in a financial sense because anyone who is nominated now has a tagline, "nominated for such and such." Even if they don't win, they were nominated. So it is a real boost to the individual's career, whether it is an actress or a director or a producer or whatever. To a studio, they have so many things going on, it doesn't make all that much of a difference, but it is important for specific films.

Q: What films would nominations be important for?
A: If the film came from a smaller studio. If it's distributed by one of the giants, they have so many other activities that it doesn't move the earnings significantly one way or the other. That's not to say that an Oscar-nominated film or an Oscar winner won't generate extra revenue. It does, but it's generally insignificant compared to the totals of these large companies.

Q: Is there a difference financially between an Oscar nomination and an Oscar award?
A: Financially, yes, there is a little bit extra for winning the Oscar rather than getting nominated. Everyone in Hollywood, of course, wants to win. They don't just want to be nominated, they want to win. So for them, it is important, for individuals. But again, I believe most of the benefit comes from the Oscar nomination, which boosts up the box office interest before the awards are handed out.

Q: Have the impact of the Oscar awards been diluted by the other award shows?
A: Yes. The answer is yes. The Golden Globes kind of stole a lot of the thunder over the recent years.

Q: Do the Oscars impact DVD sales?
A: Yes, it helps. There is no doubt. That's where it probably has most of its benefit.

Q: Does being known as an Oscar-caliber film studio mean something?
A: Look, people like to go where the winners are. If you can demonstrate that you did this and this and this, the impression is given to the artist, to the creative community, that you have a very friendly place or a place where you can win. It is kind of like joining the Yankees. The Yankees are where everybody wants to play even if they lost to Boston last year. It doesn't matter because they are contenders.

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