This can definitely scare audiences in a cinema,
I really love all of these special effects in separate places,
I love how the story works, They Try and Get their young daughter out of the Tv because she has been trapped in before.
As most people like to think Visual Effects are getting better and CGI is getting worse now of days, But since they didn't use any CGI this movie would be the perfect horror.
That said, the film suffers from special effects that were spectacular at the time but have not aged well. It is also, as many others have pointed out, a victim of Spielberg's influence and in particular his "cuteness curse." While the sweetness of some of the film can provide a powerful contrast to the much darker scenes, it also tends to break the sustained tension that is so crucial to good horror.
In essence, it's a good film and no doubt a horror classic, but it has some flaws that relegate it to a lesser classic by some standards. A great movie if you want to scare the crap out of your kids but aren't ready to go "Full-Exorcist" yet, and definitely a must-see for any horror fan.