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Hollywood in the 10s
The advent of sound into motion pictures during the late 10s consolidated the workings of the American film industry into what has been labeled the studio system. Through the 10s and 140s, under an arrangement known as vertical integration, eight companies dominated not only the making of narrative feature films, but also their international distribution and in many cases their national and even international exhibition in theaters.
Five corporations-Paramount, Loews (parent company of the more famous MGM), Fox Film (later 0th Century-Fox), Warner Bros., and Radio-Keith-Orpheum (RKO)-each owned a studio, a worldwide network of offices, and a chain of theaters. Three minor companies-Universal, Columbia, and United Artists-owned no theaters but cooperated with the oligopolistic aspirations of the Big Five in excluding all other interests from the Hollywood studio system.
The Big Five, by controlling picture palaces in all of Americas downtown districts, took in the bulk of box-office dollars. Only after they had granted their own theaters first run of their product did they permit smaller, independently owned theaters to scramble for bookings.
International distribution guaranteed the companies maximum return on their films. They alone could guarantee a supply of top features, shorts, and newsreels to theaters around the world. For a newcomer to set up a rival network would have been cost-prohibitive, and even film companies in other nations lacked the resources to compete with Hollywood in the international marketplace. Indeed, so powerful was the American film industrys advantage in distribution, that most companies outside the US conceded part of their own domestic market to Hollywood.
The other defining component of the studio system was its factory-like system of production. The classic Hollywood narrative film became the standard for movies the world over, and Hollywood studios were organized so that every element of film production, including screenwriting, shooting, and editing, was carried out on a regular, cost-effective basis. Ensuring a smooth flow of product meant continually developing stars, training technical and creative personnel, and building and maintaining sets, all of which was supervised by the head of studio production.
The Big Five
Each studio had a slightly different approach toward making movies and handling its theaters. Paramount did best during the 140s with predictable fare from such stars as Bob Hope and Bing Crosby. But equally as important was its massive theater chain, the nations largest. More than any other member of the Big Five, Paramount relied on its more than 1,000 theaters to maintain its corporate might.
Metro-Goldwyn-Mayer was the most famous of the Hollywood studios, although it functioned, from a purely business perspective, simply as a unit within the larger enterprise of Loews, Inc. A fully integrated movie company, Loews began as a theater chain, with its greatest area of domination in New York City.
Fox merged into 0th Century-Fox in 15 and found financial success soon afterward. Studio boss Darryl F. Zanuck developed a number of stars, none more important than Betty Grable, the most popular female screen attraction of the 140s.
Warner Bros. was the lone family-run operation, with eldest brother Harry in charge in New York while Jack ran the studio in California. Its theater chain was not as large as Paramounts, but the company did well by players such as Bette Davis and James Cagney.
RKO enjoyed the shortest, least profitable life of any major studio. The company was formed so that RCA could market its sound equipment and the Keith-Albee-Orpheum vaudeville theaters could be converted into movie houses. RKO struggled along through most of the studio era, despite stars such as Fred Astaire and Ginger Rogers and occasional superlative efforts like CITIZEN KANE (141).
Universal Pictures, Columbia Pictures, and United Artists never could match the economic muscle of the Big Five. Nevertheless, Universal had its horror films and the comedies of Abbott and Costello; Columbia had Frank Capra and the skills of studio boss Harry Cohn; and United Artists had Sam Goldwyn and David O. Selznick during the best years of the studio era.
The Unions
Through the 10s and 140s only outside events disturbed the monopoly held by Hollywoods eight major companies. Although the Great Depression caused widespread social and cultural transformations, the Hollywood studios endured. From 10 to 14, box-office income fell by approximately 5 percent. In an effort to counter this decline, exhibitors offered more double feature shows, opened concession stands, and gave away free gifts. The studios in turn laid off workers and pushed those still employed to work longer hours for less pay. Memoirs of stars and directors recall dawn-to-dusk working days, with few breaks for creative reflection. In response, workers began to organize, and the unions and guilds so famous today, such as the Screen Actors Guild and the Writers Guild, originated and expanded.
World War II compelled many nations to devote most of their resources to survival-a situation that allowed the movies in America to prosper as never before, and corporate Hollywood to make up for all the losses it had accumulated during the Great Depression. Theatrical attendance in 145 and 146 set records on a per capita basis that may never be broken.
The Demise of the Studio System
After the end of the war, a combination of social, economic, and political forces brought the studio system to an end. The suburbanization of the nation led to diminished theatrical attendance and the eventual closing of the big movie palaces. And the end of the studios dominance of exhibition finally came as a result of the United States Supreme Court ruling of 148, which forced the Big Five to sell their theaters. During the 150s the coming of television provided a new market for all eight companies, and the minor studios began to prosper by releasing the films of independent producers. Even the Big Five soon became simply film distributors and not manufacturers as they had been since the 110s.
The studio system may have ended in the early 150s, but the major Hollywood companies did not go out of business. Instead, they restructured their release schedules to accommodate the new theaters in shopping centers and malls. They produced dazzling color films in wide-screen splendor. They began to sell their films to television. And they began working with stars, directors, and producers on an independent basis. Only RKO actually went out of business. The studio system of the 10s and 140s was gone, but the corporations of the studio era adapted and remain with us today.
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