I think to truly understand the potential for horror in entertainment, you need to look at Silent Hill 1 and 2, and P.T.

These are games that understand that atmosphere, symbolism, and immersion are three crucial elements to any horror experience. It's really sad to see that these elements aren't in modern horror anymore, especially in the American and Japanese markets.

Slasher and ghost movies in particular, since the birth of them, have had no idea how to set up tension and have a really foreboding atmosphere. Instead they give a villain a gimmick and he starts killing people. Acceptable when you're a kid, but hardly child's play after the age of ten, if you'll see what I did there.

Now, Silent Hill 2 knows better than anything else out there that you're going to need the crucial elements. For a good half an hour at least of this game, there are no monsters. Just you walking through an increasingly foggy forest, with only the occasional growl of some far off wolf(?) and the snapping of twigs to keep you company. When you do finally see a monster, it's only a glimpse in the fog next to a bloodstained trail. A shuffling figure that quickly vanishes into the fog. This is atmosphere making a connection with immersion and tension, due the player interacting with all of this.

Instead of the monster "creepily" attacking you right off the bat with a generic snarl, it simply shuffles down the street, leaving you to follow it. All the while, a dark, resonating ambience begins to play, rather than a dull string melody.

Horror movies haven't had these kind of elements since the silent film era. They're all to inclined to have one slow-walking antagonist that has a pension for killing young adults. The only time I've seen this work was in the delightful throwback "It Follows."

And when it comes to symbolism, well, people don't even get what that is anymore. Just look at how Silent Hill 2 effect popular culture in all of the wrong ways.

Instead of its audience, and even designers, getting intrigued with the idea of a town using someone's insecurities and past evils to really screw with them in the form of feminine monsters and many more things I won't even try to give away, people instead just worship the monsters themselves.

Look at how all these people and cosplayers on the Internet and at conventions dress up as the scandalous nurses and pyramid head, without even realizing what they represent and the uniqueness of the symbolism itself. Ask most Pyramid Head cosplayers what he represents, and most won't even realize he was supposed to represent anything.

Now, cosplaying as the aforementioned characters isn't bad, but kinda shows the disconnect modern horror culture has with the importance of symbolism.

Symbolism is used to tell half of the story with showing rather than telling, and trust me when I say this is lost to horror culture. Even to the Silent Hill designers, Pyramid Head and the busty nurses are only fan service at this point, and the fans eat it up. None of them realize that these monsters where only there to symbolize the protagonist of Silent Hill 2's insecurities. Not many people even get that anymore, and it's quite depressing.
Symbolism, atmosphere, and immersion are lost in modern horror at this point, but for now, I say we learn from the best.

Now, I'm not saying we all make movies, games and books about ominous towns covered in fog.

All I'm saying is that we use the elements that are tried and true to making a true horror experience.