At the end of Insidious: Chapter 2, the trio of paranormal investigators find what is implied to be the Lip-Stick Faced Demon from the first movie. If current news is correct, we may not be seeing Mr. Tip Toe through the Tulips in the next installment. Fangoria reports that Insidious: Chapter 3 has begun production as well as the news that Chapter 3 will be a prequel. Insidious: Chapter 3 takes place before Insidious (Chapter 1?).
This is an unexpected move. The demon from the first movie was one of the more popular aspects of the first film. It was surprising when Chapter 2 went in a direction that didn't touch upon the demon, though addressing the possession from the first film was the more logical plot thread to follow.
Chapter 2 did have flashbacks to before the first movie, but this was to add to the present day story that came after the first movie. Making the newest movie the previous exploits of Elise, Specs and Tucker may end up being interesting. The plot touching on an entity we haven't seen before could be interesting and hopefully creepy. We've seen ghosts and demons, so maybe... angels? Cthulhu?
Joking aside, this may be an unexpected turn, but could make the plot less formulamatic. The first two movies focused on the same family, so showing paranormal experiences from the trio's viewpoint may be a bit more interesting.
Wait, wasn't there another horror series that made a prequel with their third installment? Spoiler: It's Paranormal Activity 3. Is this a coincidence? More than likely.
In any case, what do you think of the series going the prequel (though still numbering it like a sequel) route? Would you rather see a full on sequel or see the series wrap up with Chapter 3?
Insidious: Chapter 3 hits theaters on May 29, 2015.