The U.S. Film Industry:A Historical Overview

J412/ J512 U.S. F ILM INDUSTRY

OCTOBER 3, 2013

Reading Quiz

What is the “new abnormal,” as discussed in Lynda Obst’s article?

Answer Essentially: Extreme reduction of risk (or attempt thereof)

Are films “properties that can be marketed into international franchises?” (p. 5)

“International has come to be 70% of our total revenues in the New Abnormal” (p. 7).

“They can invent stars for tentpoles, pay them less up front, and tie them in to infinite options for sequels, like with Chris Hemsworth in Thor” (p. 18).

The Early(US) Film Industry

J412/512

9/27/12

Film’s Inventor? Thomas Edison or William K. L. Dickson?

Dickson performed bulk of experimentation; most scholars credit Dickson with transforming a concept into reality.

Fred Ott’s Sneeze, 1894

http://www.youtube.com/watch?v=8PaJ1r0udvQ

Film as novelty

http://www.youtube.com/watch?v=4nj0vEO4Q6s http://www.youtube.com/watch?v=agvQxm_nPIw

Film as Business

From 1908:Beginnings of anIndustrial Structure

Mass Production Growth of narrative format

“Director” system

Companies: Edison, Biograph, Vitagraph, Kalem, Essanay, Lubin, plus small producers

Struggle for Control: Patent Wars

Locations of Film Industryin Early 1900s

New York

Vitagraph Company of AmericaEdison Kinetoscope Parlor

Fort Lee, NJ

Moving Pictures Studios West

Film Clip: “Hollywood East”

Motion Picture Set, 1912

Hollywood

Golden Era of Hollywood(APPROX. 1920S-1950S/1960S)

Golden Era: Film Studios Operating in Hollywood

Big Five:◦ Paramount◦ Fox◦ Loews (MGM)◦ RKO◦ Warner Brothers

Little Three:◦ United Artists◦ Columbia◦ Universal

Poverty Row◦ Republic◦ Monogram◦ Grand National◦ Others

The Big Five studios were:“a large inverted pyramid, top-heavy with real estate and theaters, resting

on a narrow base of intangibles which constitute films”(Huettig).

Business Strategies Block booking Run, clearance and zoning

Admission price discrimination

Watch at Home: “A Trip Through a Hollywood Studio”

HT TP://WWW.YOUTUB E.COM/WATCH? V=WFUA MJ ITY-0

Anti-Trust andthe Paramount Decrees

Anti-Trust Lawsuits First antitrust lawsuit (1938):

◦ Principal objective: Divest theaters◦ Secondary objective: End monopolistic practices in

film industry

Settled out of court: theater control remained with studios

Paramount Decrees Final decision in 1946

◦ Unfair practices favoring theater circuits were declared illegal restraints of trade and prohibited

Paramount & RKO filed consent decrees to divest theater holdings

Loew’s, Twentieth Century-Fox and Warners refused to comply ◦ Launched another appeal◦ Ultimately divested in 1953

Impact on HollywoodStudio System

Production: ◦ Little Three had more share of market◦ Boom in independent production◦ Production Code harder to enforce

Distribution:◦ Big Five could no longer give special

treatment to each other

Exhibition:◦ Independent theaters had more control

over their businesses

From Film Industry to Entertainment Industry

Key = TV provided “studios with blueprint for creating a new market by means of exploiting their library of titles through a new technology” (Tzioumakis, 14).

Conglomeration & Deconglomeration Conglomeration: Studios acquired by major corporations◦ e.g., Paramount = Gulf + Western

Deconglomeration: Major corporations focused operations◦ Studios able to focus on media, utilize synergy and cross-

promotion to full advantage

Strategies: ◦ Synergy, cross-promotion, horizontal & vertical

integration, global expansion

By 1966: ◦ Aging leadership◦ Production losses, lack of aggressiveness◦ Eroding assets

1966: Gulf + Western acquired for $125m◦ Overhauled mgmt, restructured company◦ Independent production◦ Television acquisitions◦ Reduced foreign distribution overhead

Paramount:

1965: The Sound of MusicFlops: Dr. Doolitt le (1967), Hello Dolly! (1968),

Star! (1968)1971: New leadership

Cut back on film productionCreated music-recording companiesAcquired TV stations, Coca-Cola Bottling Midwest,

Aspen Skiing Corporation, Magnetic Video, Pebble Beach Corporation

1977: Star Wars

Twentieth Century-Fox:

Where does digital technology fit in?

“Digital media provide lucrative platforms for new but also old media content, adding to the value of the music, film or television libraries kept by rights holders.”

-- Paul McDonald (quoted in Tzioumakis, p. 25)

Location of Film Industry / Alternatives to Hollywood

Outside the Hollywood System

Artistic cinema Minority films Exploitation films Documentary films Industrial films

Pacific NW & Hollywood

Questions?