TONIGHT’S Oscars will be awarded, most likely, in the usual atmosphere of solemn self-congratulation and decorous chest-thumping. But for all the outward celebration, the truth is that the industry is in a state of ongoing disquiet.

It is hardly news that for years now the American motion picture industry has been in a slow downward spiral. Though by some accounts attendance was slightly up in 2006 over the previous year, the box-office tracking firm Exhibitors Relations reported that attendance actually declined yet again, reaching its lowest point in 10 years. And though defenders of the industry protest that foreign markets account for 40% of a film’s revenue and that those proceeds are compensating for falling domestic box office, foreign receipts have been down too, and even DVD sales are plateauing. In short, the overall trends remain discouraging.

Even more worrisome than what could be just a cyclical dip is how people are regarding motion pictures and the moviegoing experience. A recent Zogby survey found that 45% of American moviegoers had decreased their attendance over the last five years, with the highest percentage of that decrease in the coveted 18- to 24-year-old bracket; at the same time, 21% of respondents said they never went to the movies. The two most-cited reasons for seeing fewer movies were rising ticket prices and the quality of the films (a perpetual culprit).

Another survey, this one conducted by PA Consulting for the Motion Picture Assn. of America, reached an even more chilling conclusion. Eighty-three percent of its respondents said they were satisfied with the content of the films they saw, but 60% nevertheless expected to spend less of their income on moviegoing in the future, citing dissatisfaction with the moviegoing experience and the emergence of better alternatives for their time and money.

By this reckoning, no matter how much films may improve, their prospects are not likely to — which suggests that something has fundamentally changed in our relationship to the movies. The long, long romance may finally be losing its bloom, and that is why Hollywood should be concerned.

What is happening may be a matter of metaphysics. Virtually from their inception, the movies have been America’s primary popular art, the “Democratic Art,” as they were once called, managing to strike the American nerve continuously for decades. During the 1920s, nearly the entire population of the country attended the movies weekly, but even when attendance sank in the 1950s under the assault of television and the industry was virtually on life support, the movies still managed to occupy the center of American life.

Movie stars have been our brightest icons. A big movie like “The Godfather,” “Titanic” or “Lord of the Rings” entered the national conversation and changed the national consciousness. Movies were the barometers of the American psyche. More than any other form, they defined us, and to this day, the rest of the world knows us as much for our films as for any other export.

Today, movies just don’t seem to matter in the same way — not to the general public and not to the high culture either, where a Pauline Kael review in the New Yorker could once ignite an intellectual firestorm. There aren’t any firestorms now, and there is no director who seems to have his finger on the national pulse the way that Steven Spielberg or George Lucas did in the 1970s and 1980s. People don’t talk about movies the way they once did. It would seem absurd to say, as Kael once did, that she knew whether she would like someone by the films he or she liked. Once at the center, movies increasingly sit on the cultural margins.

This is both a symptom and a cause of their distress. Two years ago, writing in these pages, I described an ever-growing culture of knowingness, especially among young people, in which being regarded as part of an informational elite — an elite that knew which celebrities were dating each other, which had had plastic surgery, who was in rehab, etc. — was more gratifying than the conventional pleasures of moviegoing.

In this culture, the intrinsic value of a movie, or of most conventional entertainments, has diminished. Their job now is essentially to provide stars for People, Us, “Entertainment Tonight” and the supermarket tabloids, which exhibit the new “movies” — the stars’ life sagas.

Traditional movies have a very difficult time competing against these real-life stories, whether it is the shenanigans of TomKat or Brangelina, Anna Nicole Smith’s death or Britney Spears’ latest breakdown. These are the features that now dominate water-cooler chat. There may have been a time when these stories generated publicity for the movies. Now, however, the movies are more likely to generate publicity for the stories, which have a life, and an entertainment value, of their own

But in the two years since, another phenomenon has battered the motion picture industry, attacking one of the very fundamentals of moviegoing: the movies’ communal appeal. Before demographics became the marketing mantra, the movies were the art of the middle. They provided a common experience and language — a sense of unity. In the dark we were one.

Now, however, when people prefer to identify themselves as members of ever-smaller cohorts — ethnic, political, demographic, regional, religious — the movies can no longer be the art of the middle. The industry itself has been contributing to this process for years by targeting its films more narrowly, especially to younger viewers. In effect, the conservative impulse of our politics that has promoted the individual rather than the community has helped undermine movies’ communitarian appeal.

All of this has been hastened by the fact that there is now an instrument to take advantage of the social stratifications. To the extent that the Internet is a niche machine, dividing its users into tiny, self-defined categories, it is providing a challenge to the movies that not even television did, because the Internet addresses a change in consciousness while television simply addressed a change in delivery of content. Television never questioned the very nature of conventional entertainment. The Internet, on the other hand, not only creates niche communities — of young people, beer aficionados, news junkies, Britney Spears fanatics — that seem to obviate the need for the larger community, it plays to another powerful force in modern America and one that also undermines the movies: narcissism.

It is certainly no secret that so much of modern media is dedicated to empowering audiences that no longer want to be passive. Already, video games generate more income than movies by centralizing the user and turning him into the protagonist. Popular websites such as Facebook, MySpace and YouTube, in which the user is effectively made into a star and in which content is democratized, get far more hits than movies get audiences. MySpace has more than 100 million users worldwide, and Fortune magazine reported that 54 million of them spend, on average, 124 minutes on the site for each visit, while 11.6 million users spend 72 minutes a visit on Facebook. YouTube’s most popular videos attract more than 40 million hits, which is substantially larger than the audience for all but a very, very few movies.

But these sites are arguably not only diverting viewers who might be attending the movies, they are replacing one of the movies’ functions: If stars’ lives are superseding movie narratives, audiences are superseding the stars. Who needs Brad Pitt if you can be your own hero on a video game, make your own video on YouTube or feature yourself on Facebook?

The promise of an alternative life — the vicarious thrill of escape — has always been one of the movies’ greatest blandishments. In the theater we could all imagine ourselves to be Cary Grant or Bette Davis. Now with avatars — essentially masks that one can use to represent oneself on the Internet — anyone can be Cary Grant or Bette Davis without having to imagine it. In effect, we have become our own movies.

Film no doubt will withstand these assaults. The industry, with its synergies, will probably find a way to profit from stars’ lives and from our own star-like lives.

But it is much more difficult to survive a change in consciousness than a change in taste or technology, and that is what the movies face now — a challenge to the basic psychological satisfactions that the movies have traditionally provided.

Where the movies once supplied plots, there are alternative plots everywhere. Where the movies once supplied community, there is less hunger for it. And though we still love the frisson that stars provide, we like our own frisson too. How the movies cope with these threats will go some way toward determining whether they remain vital or will be usurped. But the problem for the industry, even on its biggest night, is that the answer is likely to lie less in the executives’ hands than in our heads.