1. Production, Distribution and Exhibition Understanding Movies

2. Movies and Society: Basic Questions Who makes the movies we see, and why? Who sees films, how and why? What is available to be seen? How are films evaluated, and by whom?

3. What makes the image move? Persistence of vision Critical flicker fusion Apparent motion

4. Who makes the image move? The Major Hollywood Studios (1910-1960) Conglomerates (1970s-present), controlling:  Movie studios  Record companies  Theater chains  Amusement parks  Video rental outlets  And...

5. Early History of the Motion Picture Industry Highly competitive with easy access for new business:  interchangeable products  smallness of buyers & sellers in relation to market  absence of artificial restraints  accessibility of resources

6. The Motion Picture Patents Company  Thomas Edison formed MPPC (the “Trust”) in 1908 as a PATENTS POOL  cooperative of leading U.S. and French film companies  dominated the film industry from 1908-1915  Successfully excluded small companies from the market

7. WHY did the MPPC fail?  Could not meet product demand  Some independent producers bought film stock from overseas  Some independent producers moved operations out of the NY and NJ area, eventually to California  Independent distributors set up a non-MPPC distribution network  Declared a monopoly in 1915 as the result of a 1912 anti-trust case brought by Fox

8. THE RISE OF THE HOLLYWOOD STUDIO SYSTEM (1925-1948) From Monopoly (the MPPC) to Oligopoly (the Studio System)

9. The Big Five and the Little Three The “Big Five” (the Majors):  Warner Brothers  Paramount  20th Century Fox  Loew's (MGM)  RKO (owned by RCA) The “Little Three” (the Minors): United Artists Columbia Universal

10. How did the Big Five control all three levels of the industry? Vertical Integration of  Production: Camera and projector technology, scripting and filming  Distribution: Marketing and delivering films into theaters  Exhibition: The theater industry that delivers movies to the public

11. How did the studios control production? Factory principles of production made it possible:  Centralized production; huge staffs  Division and specialization of labor  Standardization of product  Specialization of employees  Grading films in terms of prestige standardized budgets

12. How did the studios control distribution? Trade practices effectively closed the market to films made outside the studio system, particularly the practice of block booking Emphasis on marketing films in Europe and other foreign countries

13. How did the studios control exhibition? Run  First, second, third Zone  Geographic coverage without overlaps Clearance  Elapsed time between runs Block Booking  Rental in packages of assorted films

14. High Sierra: A Case Study An A feature, starring Bogart and Lupino Starts first run on January 25, 1941  Studio-run theaters in 100 large cities  Ticket price=$1.00 to $1.25 Second run in May, 1941  Second run theaters (smaller cities)  Ticket price=$.40 to $.75 Third run in Fall, 1941  Neighborhood and rural theaters  Ticket price=$.25

15. Genre: How a Film is Marketed Genre: One of several categories of movies that audiences and filmmakers recognize by their familiar narrative conventions Regulated Difference: Genres benefit the industry by allowing both product standardization and product differentiation Examples of Hollywood genres?

16. What undermined the Studio System? No one thing—four large factors came together in the late 1940s:  Postwar Changes in Society  The Rise of Television  The House Committee on Un-American Activities  The Paramount Decision of 1948

17. The Paramount Decision  In 1948, Supreme Court ruled the studios in violation of Sherman Anti-Trust Act, restricting fair trade  Court ordered the Big Five studios to divest their theatre chains  Effect: studios cut their film production by half; opened the way for independent producers, though that opening was short- lived

18. Entertainment Industry Consolidation Ronald Reagan deregulated the industry in the early 1980s, allowing a new “Big Six” to emerge  Warner Brothers  Paramount  Twentieth Century Fox  Universal  Columbia  Walt Disney

19. Hollywood Today  Marriage of TV and movies: watching movies now takes place on cable and the home VCR and DVD player as well as at box office  New Hollywood studios produce TV shows as well as feature films  80-90% of new movies flop at box office, but losses recouped through home market and overseas distribution

20. Sources of Studio income today  Box office revenues  Cable and pay-per-view  Video and DVD sales and rentals  Distribution of films globally  Studio distribution of independent films  Product placement in movies  Merchandizing and promotion rights