Indian economies has already started hitting Tollywood. Less and less producers are actually interested in starting new ventures as they expect that less people will be in a mood to get entertained.
Also it is really the small and marginal producers and first times who keep the industry running. They make up about 95% of the films made. The big producers make no more than 5% of the films in Tollywood. That in reality means that the small producers keep the studios and the technical staff feeding through out the year. But as they are turning away technical staff is likely to be severely hit with no jobs.

More over it is almost a certainty that less Tollywood movies will be made in 2009. The industry will see a sharp decline in number of films made and if this trend continues no more than 50 films would see the light of the day in the following year. All this would mean losses for distributors and empty theaters.