THE DOWNWARD SPIRAL

This is the third post of three that is part of the Classic History Project Blogathon hosted by Movies Silently, Silver Screenings, and Once Upon a Screen, and sponsored by Flicker Alley.

Part 1: The Foundation Slips
Part 2: The Beginning of the End

During the 1950s, the film industry crashed precipitously. By 1953, only half as many people were seeing movies in theaters as they were the decade before. By 1957, only 15% of the population went to the movies at least once per week. Meanwhile, the US was in the midst of a post-war economic boom. People had money to go to the theaters. Why didn’t they?

It is too easy and convenient to pinpoint the Paramount Decision of 1948 as the reason for the downfall of the studios. It surely was a catalyst, but there is no single answer. Divorcement was one of many reasons for the downfall of the studio. A lot of people blame television, which is also fair, but again, just one of many reasons for the decline. It was a perfect storm of legislative, technological, and socio-economic changes that drastically reshaped American society, and subsequently, American media.

MIGRATION

In the aftermath of the Second World War, the armed forces returned home to economic prosperity. With improvements in automobiles and extra disposable income, people had the opportunity to move away from the big cities and into the suburbs. Levittown is a famous example of these communities, but there were many like it. The suburban sprawl began rapidly in the 1950s and continued gradually.

Levittown, NY

Another major driver of this migration was the Baby Boom. People were having kids and wanted to live in quieter, more relaxing places to raise them. This was the age of the nuclear family, and people wanted to spend their time raising children or participating in family and group activities.

It was not easy to bring movie theaters to the suburbs. The old movie palaces had been urban spectacles — vast buildings that were usually in the heart of downtown and could hold massive crowds. These theaters attracted people to the city and were the source of the studio profits. As people moved away, these large palaces eventually faltered. It was a challenge to bring movies out to the suburbs because the population was so scattered.

ECONOMIC BOOM

With this new period of prosperity, people wanted to spend their money on more substantive activities than going to the movies. As noted earlier, the movies were seen as low cost and short duration entertainment. People wanted to spend their money and time on memorable adventures rather than fleeting escapes from reality.

This was also the time period where the 5-day work week was becoming the standard. People had their weekends free and wished to spend them on activities such as homemaking, gardening, and sports. With transportation and money to burn, people wanted to see the world on vacations rather than see artifice in the movie theater. Prosperity actually hurt the studios.

TELEVISION

The role of television in the downfall of the cinema is hotly debated. Many consider it to be a direct cause for the studio’s demise, while others see it as more of a symptom of the economic transitions happening in society. Regardless of where experts stands on the topic, television was a factor. It quickly became a popular appliance and allowed people the convenience of consuming media at home rather than going to the theater.

The television boom began in the late 1940s and continued throughout the 1950s. The growth was rapid. By 1960, 87% of the population had a television. Unlike the movies, where people sit in dark rooms, television was a social activity. People would gather together and watch a program at somebody’s house.

The programming on television was passive and light, not as deep and profound as that seen on the silver screen. Much of the programming on television replaced the B films that the studios relied on for small profits. Television also took the pre-movie content away from theaters, such as cartoons, newsreels, and short films.

THEATERS IN THE 1950s

The large movie palaces gradually went away in the 1950s. They were replaced with arthouse cinemas, which would attract a higher brow, more intelligent and sophisticated moviegoer. The demographics for these films were older and more cosmopolitan. Many of these audiences watched films that are discussed here at this blog.

There was a foreign film boom in the late 1940s and 1950s, many of which took hold and became popular in the United States. Among these imports were the post-war Japanese (Kurosawa, Mizoguchi), Italian Neorealism (De Sica, Rossellini, Fellini), French noir (Melville, Clouzot), and later the French New Wave (Godard, Truffaut). Foreign films were not subject to the Hays code and often were provocative with sensual situations. Bitter Rice was a film that was noted for sexual suggestion. The Bergman films of the 1950s also titillated audiences, such as Summer with Monika as an exploitation film. Compared to the American films, the audiences were still small, but these foreign films pushed the boundaries and played a part in removing the Hays Code.

One creative way to get theaters to the suburbs was through drive-in movie theaters. They were relatively easy for exhibitors to open because there was plenty of land available in the suburbs. We think of the drive-in theaters differently than what they were in the 1950s. They were not just for watching movies, but were a hotbed center of activity. Of course there were the movies, but there was also food and other amenities. Some would even offer laundry services. The drive-ins were eventually seen as immoral and degenerate. Kids would use the drive-thrus as a place to discretely bring a date or get into trouble.

The next suburban theater was a bi-product of the advent of the shopping mall. Every mall would eventually have a multi-plex and most still remain today. The reasoning was that the mall would draw consumers, and movies were a way to take a break between shopping.

THE STUDIOS ADAPT: TEENPIC

This may seem incomprehensible, but the studios had not done any major market studies prior to the 1950s. However hubristic it may sound, they did not have to prior to the 1950s. So many people went to the movies that it was almost a waste to track where they came from. Prior to the 1950s, they ignored teenagers because they thought of films as family outings. As the war babies started to reach adolescence in the 1950s, they became a large market with free time and allowances to spend. During this time, Hollywood finally started using modern marketing techniques and determined that teenagers were regularly going to the movies. They subsequently targeted these teenagers with their content.

Even though it was a social picture, Blackboard Jungle was a surprise success. It was also notable for using a rock and roll song, Bill Haley’s Rock Around the Clock. In 1955, Sam Katzman ushered in teenage rock and roll movies starting with the film version of Rock Around the Clock. This trend continued, and soon Elvis Presley movies gained traction. His debut was in Love Me Tender, which was successful due to his popularity with teenagers. He starred in a total of 33 films, most of which range from bad to mediocre, but they attracted fans. There were plenty of other teen film franchises. Gidget was hugely popular and started a franchise of its own, plus it ushered in the Beach Party film. Teenagers came out in droves to watch these movies.

THE STUDIOS ADAPT: TELEVISION

As already discussed, television began by piggybacking on the radio concept of nationwide “live” content. That carried them for a short while, but soon a more diverse range of content would hit the screens. The studio system is responsible for much of this content.

The independent producer model took hold with television. Major Hollywood players began dipping their toes into television in order to make profits. David O. Selznick came out of retirement to do this very thing. He achieved success with a program called Light’s Diamond Jubilee, which was broadcast on all four networks and seen by 70 million viewers. This was a staggering number for the time period. Other similar jubilees preceded Selznick’s and would follow him. As he was before with film, he became obsessive with the project and this was the final Selznick TV production.

The most notable independent production company was Desilu, founded by Desi Arnaz and Lucille Ball, and popularized by their hit show I Love Lucy. That was not their only success. They would release The Untouchables, Star Trek and many others. Delis proved that independent producers could become television tycoons.

Eventually all of the major studios would transition to television. As already discussed, Disney was the first to find success with Disneyland and later Walt Disney Presents. After early failures, the studios gained a foothold in this new arena. They still had studio space that was not being used, so they started putting together television programming. Warner Brothers signed a deal with ABC and launched Warner Brothers Presents, which was their first foray into television. They continued their relationship with television, using the same production methods as their old B movies and found success in television. They became known for their westerns like Cheyenne, Maverick and Sugarfoot.

Universal/MCA became the unquestioned leader among studios in television production. Their continued production of B pictures after the Paramount decision helped for a smooth transition from the large to the small screen, and they transplanted many of their successful film franchises to television. They also launched popular shows of their own, such as Leave it to Beaver, Alfred Hitchcock Presents and several others. Today they are a multi-media conglomerate, NBC Universal, that own various entertainment properties.

THE FUTURE STUDIO SYSTEM

As the tumultuous 1950s ended and the 1960s began, the studios had reached a level of comfort and stability. They all continued working in television, using their facilities for new programming, and they continue to be major players in television today.

The independent producer model, as previously discussed with Selznick, became the norm. Professional producers such as Hal Wallis and Robert Evans worked closer alongside the studios and the talent. Evans had previously been head of Paramount until he obtained success with Chinatown in 1974. He then stepped down and worked as an independent producer, yet he continued to produce films for Paramount.

Steven Spielberg’s Jaws was the first blockbuster hit, and it revived the studio system to a certain degree. They were still divorced from vertical integration, but they began to focus on large blockbuster releases, a trend that continues today. One could argue that Jaws saved the studios, and ever since they have relied on blockbuster franchises for their core profits.

WHERE ARE WE GOING?

We are now in the digital age, which seems to be another period of transition. Box office revenues are still high, but more and more people are watching movies at home, either through streaming services like Netflix, Amazon, Hulu or Video on Demand. Premium content that used to be found only on the large screen as a film can now be found on cable as an expensive mini-series. Popular shows like Game of Thrones and The Walking Dead would not have a chance twenty years earlier.

Predicting the future is impossible, but sometimes the past informs the future. We could be heading into another transition into the digital change that will change how people consume entertainment in the future. Only time will tell what this will mean for cinema, television, and visual media in general.

SOURCES

• Anderson, Christopher. Hollywood TV: The Studio System in the Fifties.
• Maltby, Richard. Hollywood Cinema.
• Sarris, Andrew. The American Cinema: Directors and Directions 1929-1968.
• Schatz, Thomas. The Genius of the System: Hollywood Filmmaking in the Studio Era.
• Staiger, Janet. The Studio System.
• Staggs, Sam. Close-up on Sunset Blvd: Billy Wilder, Norma Desmond, and the Dark Hollywood Dream.

THE BEGINNING OF THE END

This is the second post of three parts that is part of the Classic History Project Blogathon hosted by Movies Silently, Silver Screenings, and Once Upon a Screen, and sponsored by Flicker Alley.

Part 1: The Foundation Slips

UN-AMERICAN ACTIVITIES

The House Un-American Activities Committee (HUAC), the Hollywood Ten, and the subsequent blacklistings are large topics in their own right. They did not directly impact the downfall of the studios of the system, but they were yet another symptom that something was broken. The anti-communism movement and the fallout contributed to a great deal of pessimism within the industry, while also removing talented individuals that included actors, directors, writers, and even common crew.

The hearings and inquiries into Hollywood began in 1947 where they were trying to identify Hollywood filmmakers who had ties to the Communist Party, and were subsequently trying to influence Americans with a leftist agenda expressed through film. The Hollywood Ten refused to testify and were blacklisted. Many other notable individuals would later be blacklisted, including Charles Chaplin, Orson Welles, Martin Ritt, John Garfield, Judy Holliday, Dashiel Hammett, and countless more. Some cooperated and testified, naming names. This list included Elia Kazan and Sterling Hayden.

PARAMOUNT DECISION AND REPERCUSSIONS

The Paramount Decision of 1948 was the smoking gun that effectively ended the studio system’s dominance of the industry. All of the tricks like block booking and blind bidding were immediately abolished, once and for all. The entire decision can be read here. It was a detailed decision and a pointed one. The studios had to divest themselves of their theater holdings and operate as production companies only.

The decision was devastating and there were major repercussions. Overnight, the landscape had changed and the studios had to make drastic operational changes. The fallout would pave the way for television and a new era of Hollywood filmmaking.

Since the studios could no longer push their lower quality inventory on theaters, they had to scale back on B picture productions. Most of the studios focused solely on A pictures. This meant there were also fewer overall productions. This meant fewer jobs, at least in film.

Each studio transitioned differently. Universal was one of the outliers that remained in the lower grade feature or B picture business. They revived the Abbott & Costello franchise, and originated some other franchises that would eventually land on television.

The studios now had to make deals directly with the talent. In this new world, they resembled the independent systems like the Selznick system. Since they had lost leverage, the negotiations were not always in their favor. They made deals with filmmakers, such as Alfred Hitchcock as independent producers and directors. The talent that was in demand held substantially more leverage than they did under the old system.

The directors, actors, and all of the talent were essentially free agents. They made films for different studios. During what most consider to be Hitchcock’s best work in the 1950s, he worked primarily with Warners and Paramount, but he made North by Northwest with MGM. Directors like Hitchcock developed more into auteurs, whereas in the previous system, producers such as David Selznick and many others (Val Lewton for instance) had some sort of authorial control.

TRANSITIONS

Each studio handled the changes differently. With television coming into play, the industry was shaken up dramatically. At first the studios were reluctant to get into bed with television, which they saw as competing for the same viewers, although that changed once some social-economic realities set in.

Lew Wasserman

Lew Wasserman formed MCA, basically a talent agency, and he became a power player in the scene. He functioned similarly as David Selznick did in the 1940s after getting out of feature production and farmed out talent to the various studios for a profit. MCA acquired talent such as Jimmy Stewart, and leveraged them against the studios to benefit their clients. One of Wasserman’s major deals involved Jimmy Stewart and Universal, where he negotiated a tax-friendly deal for Stewart to get a large percentage of the profits. This in a similar vein as the deals that Capra and others had made to get paid in capital gains, although far more generous. Stewart was able to obtain 50% of the profits of Anthony Mann’s Winchester ‘73. This was an unprecedented number, and Stewart was also more involved in other aspects of the production. This was new and shaky ground for the studios.

Here is an interesting and not very flattering piece on Wasserman from Slate.

Studio head Louis Mayer left MGM in 1951 after a power struggle with Dore Schary, the then head of production. This turned out to be a fortuitous move for MGM, as they were able to survive under Schary under the strength of the musicals. Musicals such as Singin’ in the Rain and An American in Paris were massive moneymakers for the studio, and there were plenty other successful musicals on a smaller scale. The studio continued churning them out and they outlasted all other studios at remaining profitable and prominent without making drastic changes. By 1955, most of the musical profits had run their course and MGM transitioned just like the rest of them.

THE STUDIOS AND TELEVISION

There was reluctance for the studios to transition to television. It was thought to be a lower quality product, and in the beginning, that was true. At first there were mediocre offerings with an emphasis on being “live,” which is something that separated TV from film. Over time, the TV content transitioned to resemble the B features that the studios had formerly cranked out. In many cases, the same studio lots that were used for B films were used for TV shows. As the film industry went through a downfall, they had no choice than to jump into the arena.

By 1955, most studios had made their attempts at launching television programs. Disney, MGM, Warner Brothers, and 20th Century Fox all made attempts, yet few of them were successful. Disney was the only significant success with their show Disneyland, which was partly because it was tied to their popular theme parks. Many studios noticed how well Disney was able to transitioned and tried variations with mixed results.

A watershed moment came when The Wizard of Oz was licensed to television and scored huge ratings. The studios again took note and unloaded their film inventory to television for large sums of money. Television became a second-run outlet for older film inventory. Back in those days, there was not much of a secondary market for film inventory, so this was a pivotal moment.

There will be more discussion of the studios and the transition to television in the next section.

Next: The Downward Spiral

THE FOUNDATION SLIPS

This is the first post of three parts that is part of the Classic History Project Blogathon hosted by Movies Silently, Silver Screenings, and Once Upon a Screen, and sponsored by Flicker Alley.

These essays are based on previous research that I have done and I will share my sources at the end.

POWER

On an early 1948 evening, the Wilders and Goldwyns dined together at a Romanoff’s in Beverly Hills. It was a popular restaurant for the industry, with many top-flight stars showing their faces regularly. The foursome’s dinner was interrupted by an elderly, disheveled man, looking gaunt and possibly drunk. He approached the table and gave Samuel Goldwyn a tongue lashing, criticizing the mogul for the unwarranted success he had achieved. He ranted that “here you are, and I ought to be making pictures, I’m the one.” Goldwyn was shaken, and after the man left the table, revealed him to be none other than D.W. Griffith, one of the most important and influential silent filmmakers that ever lived. The system had made him, and then chewed him up and spit him out. A couple of decades later, and it could have been the studio system saying the same thing to another dinner party.

The Big Five Studios.

The studio system was a behemoth. They consisted of the “Big Five,” which entailed Fox, MGM, Paramount, RKO and Warner Brothers, plus there were also Universal, United Artists, and Columbia, often referred to as “the other three” that had plenty of power. The studio controlled the movie process from production to distribution to exhibition. They wrote contracts with actors, writers, directors, producers, and virtually all involved with the industry. They released the “A” pictures (prestigious star vehicles) to the movie palaces, while the lower budget films, often genre or from recycled scripts, comprised the “B” pictures.

During the Great Depression, films were considered to be a populist, relatively inexpensive form of entertainment. Much of the content of the films of the 1930s pandered to the masses, and despite experiencing losses during a few bad years, the studios more or less continued to rake in the profits. During the Second World War, they experienced a boom and seemed to be able to do no wrong. Because of their absolute control and success, they were blinded as to what was taking place behind the scenes that would result in their undoing.

INDEPENDENCE

David O. Selznick

The move towards independent production started early. There were many wunderkind producers that worked at the major studios. Irving Thalberg was one such youngster who seemed to be able to do no wrong, producing hit after hit for MGM, but he died at a young age. David O. Selznick was another young, successful producer, and he was far more ambitious. He began his career during the silent period at MGM, and then moved to Paramount, RKO, and then back to MGM.

Selznick was confident in his abilities, yet resented the studios for profiting off of him. He decided he wanted to become an independent producer. He was not the first to attempt such an endeavor. United Artists was put together by a number of powerful industry players, including D.W. Griffith and Charles Chaplin, but Selznick’s vision was different.

Selznick founded Selznick International Pictures (SIP), and worked independently as if he were at a studio, yet he was aligned with the studio system. He would produce “A” pictures, choosing top-flight directors, actors and crew without the constraints and meddling of the studio chiefs. He had an obsessive personality and would micro-manage the projects. In many respects, he was at least partly the auteur of his works. Years later, Alfred Hitchcock would do his editing within the camera in order to maintain some sort of creative control of his pictures made with Selznick.

Selznick has his critics, but he was undeniably successful. He released a string of hits, notably A Star is Born, Rebecca and Gone With the Wind. Winning Best Picture at the Academy Awards for the latter two in consecutive years.

Selznick was as successful a talent scout as he was a producer. He was particularly fond of finding leading ladies, such as Ingrid Bergman and Joan Fontaine. He also “discovered” Alfred Hitchcock as a director and brought him to work in the United States with a seven-picture deal. He would contract with them directly through SIP, and if he was not ready to make a picture with them, would farm them out to other studios. As his clients stars rose, so did their fees. Eventually Selznick would become exhausted by the intensity of movie producing, and would lend his stable to studios. He would charge them the going rate, pay his talent based on the contract, and pocket the difference. This amounted to millions of dollars.

ANTI-STUDIO LEGISLATION

During the 1930s and 40s, the Department of Justice was taking a close look at the studio system. They felt that the studios were using unfair trade practices when distributing films to theaters, leveraging their power to get the chains to take inadequate deals. The primary tactics that the DOJ frowned on were block-booking and blind bidding.

Block Booking was the practice of selling a block of films to the theater. This usually would consist of one or two A pictures that would be guaranteed to give them a profit, and a handful of B pictures that may not be as successful. The A pictures were rarely parceled out on their own. It made business sense for the studios because they wanted to find screens for all their pictures, but the DOJ correctly thought that this practice was unfair for the exhibitors. Blind Bidding is just what the name implies. The studios would sell pictures to theaters without letting them see the film. Sometimes this would happen before picture had been produced.

Anti-Trust Decisions: From 1938 to 1940, there were a series of decisions that limited block booking, blind bidding, and other unfair trade practices. The first decision in 1938 was targeted towards all eight large studios, while the latter decision in 1940 was limited to the five majors. The repercussions of these decisions actually benefited the studios. They had to cut back on B pictures and focus on larger A productions. Because of the film boom during the war years, this helped the studios as the large productions were overwhelmingly successful and profitable. Losing the B pictures helped them slim down their overhead.

Revenue Act of 1941: With an expensive war in process, the need for tax dollars rose. The Revenue Act was passed in order to impose high tax rates on people who were in the upper tax brackets. There was approximately a 70-80% tax rate for those earning $200,000 annually. Of course a lot of the stars in Hollywood, behind and in front of the camera, earned salaries of this magnitude. For instance, all three of the leads of Double Indemnity earned $100,000 for their roles. Under the Revenue Act, they would have to pay roughly $80-90,000 to the IRS.

The repercussions of this legislation pushed the talent closer to independence. Rather than continue to pay flat fees, the studios changed contracts so that the talent would get a percentage of the profits. This meant that they would be taxed as capital gains at a far lower tax rate. Frank Capra’s Meet John Doe was one of those first deals.

Olivia de Havilland Decision: The star actress wanted out of her contract and the studio was effectively holding her hostage, unable to leave for a rival studio. She sued successfully to get out of her contract. The ruling kept the studios from adding suspension time to contracts to keep them from being free agents.

Post-war DOJ Initiative: With the studios continuing to be unfettered by any government intervention, the DOJ wanted to move aggressively at breaking up the studios. The issue at hand was the amount of the control. The studios were by definition a monopoly, vertically integrated to control production, distribution and exhibition. The DOJ wanted to break these three pieces up.

INDEPENDENT FILMMAKERS

As contracts ended, directors wanted to follow the Selznick model and forge their own independent companies. Several famous directors took this route and released films under their own “studios.” Some of them were more effective than others. Some of the filmmakers would remain independent, while others would return to the studios.

Alfred Hitchcock, reeling from his bad deal with Selznick, created Transatlantic Pictures. Under this company he made Rope (1948) and Under Capricorn (1949) with more creative freedom. Rope was more of an experimental film, and probably not one that would be possible for a filmmaker without Hitchcock’s caliber, and definitely not under the studio system. The experiment did not go as well as planned and was financially unsuccessful. The follow-up, Under Capricorn was less successful and that marked the end of the famous auteur’s independence. Hitchcock would make some of his best pictures in the 1950s for various different studios.

Frank Capra, William Wyler and George Stevens formed Liberty Films. Only two films were made through this company, and both of them were from Frank Capra. They were It’s a Wonderful Life (1946) and State of the Union (1948). It is difficult to believe given the reputation today, but It’s a Wonderful Life was a financial failure. This ended the project, with Paramount buying the assets and finishing the second Capra film. They also signed deals with the three principal directors. William Wyler made The Heiress for Paramount in 1949.

The most successful of these early director forays was John Ford’s Argosy Pictures. Ford had a lot going for him. For starters, he was reliable director, churning out quality content that did well at the box office. He was also an efficient director, usually coming in below budget. Ford did not strictly work on projects for his own company, working occasionally with the studios as needed, but he kept Argosy going for some time. Some of the notable Argosy films were Fort Apache, She Wore a Yellow Ribbon, Rio Grande, and The Quiet Man. Even with longevity and success compared to the others, a financial failure doomed his company and Ford also returned to the studios.

Next: The Beginning of the End