The first four decades of the film age (roughly 1908-48) saw the increasing concentration of control in the hands of a few giant Hollywood concerns. Since the late 1940s, however, that trend has been reversed; the monolithic studio system has given way to independent production and diversification at all levels of the industry.
Although in the silent era small, independent producers were common, by the 1930s, in the so-called golden age of Hollywood, the overwhelming majority of films were produced, distributed, and exhibited by one of the large California studios. Led by M-G-M, Paramount, RKO, 20th-Century-Fox, Warner Brothers, Columbia, and Universal, the industry enjoyed the benefits of total vertical integration: because the studios owned their own theater chains, they could require theater managers to charge fixed minimum admission rates, to purchase groups of pictures rather than single releases ("block booking"), and to accept films without first previewing them ("blind buying"). For more than two decades the major studios completely controlled their contracted stars, managed vast indoor and outdoor studio sets, and in general profited from what amounted to a virtual monopoly of the industry.
Shortly after World War II, three factors contributed to the loss of the majors' hegemony. First, a number of federal court decisions forced the studios to end discriminatory distribution practices, including block booking, blind selling, and the setting
of fixed admission prices; in 1948 the Supreme Court ordered divestiture of their theater chains. Second, the House Committee on Un-American Activities investigated the industry, which responded by blacklisting several prominent screenwriters and directors--an action that called into question the industry's reliability as a promoter of unfettered creative talent. Third, television began to deprive Hollywood of large segments of its audience, and the industry reacted timidly and late to the possibilities for diversification presented by the new medium.
The effects of these developments were immediate and long lasting. Weekly attendance figures fell from 80 million in 1946 to just over 12 million by 1972. Box-office revenues in the same period dropped from $1.75 billion to $1.4 billion--and this despite constant inflation and admission prices that were often 10 times the prewar average. The movie colony experienced unprecedented unemployment. The number of films made yearly declined from an average of 445 in the 1940s to under 150 in the 1970s,
as the industry sought solvency in "blockbusters" rather than in the solid but unspectacular products that had brought it a mass audience before the age of television. Between 1948 and 1956 the number of U.S. theaters fell from 20,000 to 10,000, and although 4,000 new drive-in theaters somewhat offset this attrition, by the mid-1970s less than half of the American spectator's amusement dollar was being spent on movies; in the 1940s the yearly average had been over 80 cents.
By the late 1960s the major studios had entered a grave economic slump, for many of their "big picture" gambles fell through. In 1970, 20th-Century-Fox lost $36 million, and United Artists, which as the industry leader had more to lose, ended up more than $50 million in the red. In response to this devastation of its profits, the industry underwent a profound reorganization. Following the 1951 lead of United Artists, the majors backed away from production (since its cost had contributed heavily to their decline) and restructured themselves as loan guarantors and distributors. At the same time, most of them became subsidiaries of conglomerates such as Gulf and Western, Kinney National Service, and Transamerica and began to look to television sales and recording contracts for the revenues that previously had come from the theater audience alone.
In setting up these new contractual relationships the independent producer played a central role. Such a figure, who by now has replaced the old studio mogul as the industry's driving force, brings together the various properties associated with a film (including actors, a director, and book rights) to create a "package" often financed independently but distributed by a film company in exchange for a share of the rental receipts. Working with the conglomerates and accepting the reality of a permanently
reduced market, these private promoters have partially succeeded in revitalizing the industry.
The rise of independent production has been accompanied by diversification of subject matter, with close attention to the interests of specialized audiences. This trend, which began in the 1950s as an attempt to capture the "art house" audience and the youth market, is evident today in the success of martial-arts, rock-music, pornographic, documentary, and black-culture films. Simultaneously, production has moved away from the Hollywood sets and toward location filming. For many producers, New York City has become the New filmmakers' mecca, while shooting in foreign countries, where cheap labor is often plentiful, has given the modern film a new international texture; foreign markets have also become increasingly important. Both geographically and
financially, therefore, the film industry has begun to recapture some of the variety and independence that were common in the days before studio control.
Thaddeus Tuleja
Bibliography: Balio, Tino, ed., The American Film Industry (1976); Brownlow, Kevin, Hollywood: The Pioneers (1980); David, Saul, The Industry: Life in the Hollywood Fast Lane (1981); Phillips, Gene D., The Movie Makers: Artists in an Industry (1973); Stanley, Robert H., The Celluloid Empire (1978).
Copyright 1995 by Grolier Electronic Publishing, Inc.