Balio - A Mature Oligopoly

8/13/2019 Balio - A Mature Oligopoly

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PamtrnnA Matu'n Oligopoly,Stnuotusre of the IndustnY

l'e guaratttccd a sl'rowing.sort of symbiotic relationship with 1hcc Littlc 'Ihrcc: lJnivcrsal, C]olumbia, anciJnivcrsal anci Colunbia hacl thcit'owustuclios anel clistrillr-rtion lhcilitics and we:rc useful 1.o lltc:rrtajors cluling thc 1930s ancl l940s in :ir-tplrlying low costpiclrrr.cs lo facilitalc [i'cquc--nt pl-ogfalll chaugcs ancl ilotttrlclfcrturcs. tJnitocl Artisls, lho stlallesl tlf'1h cigh1., witt;uniquc; i1 was solcly a clislr'ibutioll collllla-ny fol' r slnLll

tlic nrovitl itleh'rs1r'Y as cloluiualcd by a sclrticotlpttls


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)6? l)ri Ill / /\ Mnltrc Oligo1rol1,. 'l3()_ f 4gpt cturcsall, 1o fi of'subsccl uc1'rangeclto lhree hundrcd piclurcs agL'flrcd itscll'to l)r()ducirg {wo ryrcs o1 piclrrr.r,s_tht, class with name s1ars, lavish scts ancl cosrumes, and bie budscr.and thc class B, chcapics proclucccl on a shocstr i,ig. i""",would not havc bccn proflablc for thc s1.u


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I / A Mature Oligopoly, 1930-194gs, but surrogates for the pro-wishes and concepts. By thclios had organized their produc-rnner with each associate pro-nsibility of making arouncl sixon a project, thc associale pro-;e the writing of the screenplay.gh several stages of develop-.ory version around twenty-flvecribing each major scene; and:ontaining a breakdown of thegue. Seldom did one screen-Wore likely, a different writer orassigned to each successiveIt the studio, screenwriting haditers were hired for their skill incomic effects, and others for[, the production chief now as-)r the top stars, the scripts wereDirectors, too, might have been'en consulted during the frnalbut only a few, such as Ernst.chael Curtiz, were afforded thisshot the script as written. He, casting, or editing. The conceptd only as it related to the pro-example, thouglrt of the com-ll. After sneak previews, het and altered endings for greaterrstproduction phases, other de-lion, costumes, makeuP, cine-own the line to special effects.contribute to each picture asfGM made its forty pictures aof six thousand who werelepartments.lerized Hollywood productionnomic rationale for using starsThalberg added a new twist

Part lll I A Mature OligoPolY, 1930-1948 265

the producer cast him or her in different roles and mea-sur audience reaction to each performance' Fan mail,

career would come to an unhappy end unless, of course, ad at being stereotYPed' RePeat-the spirit and Prevented a tal-s full potential. Studios justi-fied their policies with the explanation that developing astar required enormous expenditures of money' To tamperwith success would be foolhardy. Regardless, they coulddictate policy by enforcing the provisions of the optioncontract. Used for stars, feature players, and importantproduction personnel, this contract tied talent to the studiolor a fixed term, usually seven years. At yearly intervals,the studio had the option of renewing or dropping thecontract. If renewed, the person received an increase insalary as previously specifed. This type of contract placedtaleni in a subservient position; they were employees whohad to perform as the studio wished. "Difficult" peoplecould b disciplined by being loaned out to appear in pic-tures that had little chance of succeeding.revolved arounddimensions greatlywood glamour,and goings wereinterest in the public mind.The publicity department handled press releases, inter-views, nd press agent activities. lt was organized like the


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266 Parl ill / A Malnrc ()lironol1, to;1g J .iclly roonl of'a nc:rvspapcl.. 'las cclitol'. rnakillg assignn)cnbcfore it was rclcascd, Specisalaries, and harcl ncws sloriwc'c llis spocia donrain. whcu a suicicrc o' lossy di'orccoccurred. he had 10 usc public relations of a high or,j..^"'10 protcct 1hc r.cpulation of the studio and to Lluog; ncarecr. Working undcr thc clcparlmcnt heacl wcrc t unitreporlers who covcrcd thc big picturcs ancl built up n;^"players, and pubricisls who wcie assignc to inivluaistars. Sincc thc publicisf was conccr,,.,l *ith thc propeeup. and gcucral ap_ifJ:ili':i.?iill'void. The rcnrainder of thcpublicity dcpartment spccializccl in crcating fasnin"fay_"outs, in scrving as lia_isons with fan -ogorin"r, on,i pJnt_ing stories with Louclla parsons, Hcclcta"Hoppcr, and othcrgossip columnists. Hollywoocl was thc thir.cl lrgcst rr.*r'''source in thc country, outrankcd only by V/ashington anclNcw York. Three hunched correspondents reprcsenting fanmagazincs, newspapcr syndicatcs, and periodicals scntnews all ovcr the tJnitccl Statcs and abioad. Evcn thc Vati_can had a corr.espondcnt in Hollywood.Of all the outlets for publicity, thc fan nragazine was lhemost voracious.Screen, thc largetions of nearly achildren, and death were their )maclc the best copy, and ()'clnple. f)eanna f)urbin.oncy.nrcnl supplied the iconogra_sical artifacts of the motionplcture expcrence. For all procfuctions, photographs weretakcn of key sccnes for usc in lobby ,iitoyr, aclver.tising,and poster layouts. Glamour ponra;ts, a staplc of.thc clc_partment, reached the level of ."objcts (l,art.,, In thc handsof such skilled photographcrs as Gorgc luncl ancl Clar_

cncc Bull, thcse portraits capturecl" i a singc still, thccssence. the inragc 'f lhc s1ar. wrrar rhe rr'r"took ,ri,i.iumlnutes to cstablish, By the lhousands thcsc siills wcrt out


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268 parr lll / A Marure Oligopoll,, 1930_ i 948ent in the systent. But beuct to reach a mass audieto outside intimidation ibe rememberecl that thcconstitutional guarantecs1922. As a result of adept public relations work on the par.lof its president, Will UVs, reformers were mollifed withthe assurance that the inritselL The Committee onHays used to achieve hiabsorbed into the MppD

ducled a study of the speciby state censorship boaids.ment entitled .,Don'ts and Be Carefuls.,, The list of"Don'ts" contained ereven rtems that could not be shown

the use of drugs, and exces ,askcd for voluntary .orptiun." U..,machinery was thought to be repugnant fo producers.The vagueness of rhe coae spu. Marti'n a;i;, "arholic layman and publish.iof tfr. influential trademagazine Moilon picture Herald, to improve ;, ;;.Lord, a Jesuit priestThe King of Kings, to'fhe Motion pictureed in 1930 and with Havs,wa s i m p r e m e n r e d, r h e s r u d i o : : J i,i,?: J T; t.empowercd to work with proclucers througho;a;ll-r;";;,of production from the writinl i u ,".nurio to the nalediting of the picturc.Up un1 ducers wcrc firly conscien_tious in a ion Code, but when boxoffice atte 32_33, they introducedmore explicit and violent subjcct malter into lheir pi.tur.,


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rt Iil /A Mature Oligopoly, I930_l94g

lre content and Hollywood scan_a public outcry for censorship dur_ading to the formation of the Mo_nd Distributors of America inIt public relations work on the partys, reforners were mollified withdustry could effectively regulater Public Relations was the meanshis goal. After being formally)A in 1925, the commiflee con-:cific rejections and deletions madels. These were codified in a docu-rd Be Carefuls." The list of:n items that could not be shownrite slavery, miscegenation, sexualrf the clergy. The list of "Be Care-ix subjects such as internationaltechniques, rape, first-night scenes,:essive and lustful kissing, Hayspliance because an enforcemento be repugnant to producers.:ode spurred Martin Quigley, arlisher of the influential tradet Herald, to improve on it. He'Daniel A. Lord, a Jesuit priesttdvisor on The King of Kings, fo:d version. The Motion Picturenpleted in 1930 and with Hays')A members. To see that the codeudio Relations Committee wasproducers throughout all stages,riting of a scenario to the finaln, producers werc fairly conscien-roduction Code, but when box:ted in 1932-33, they introducedsubject matter into their pictures

Paft lll I A Mature OIigoPolY, 1930-1948 269in an attempt to attract over, producers werenot sure that the 1930 resented and reflectedwith the public wanted church cried out inDrotest, as did Protestant and Jewish organizations. Thebatholics were the most militant and declared war againstthe industry by forming the Legion of Decency in 1934with the goal of boycotting offensive pictures until the in-dustry created a mechanism to enforce the ProductionCode. Rt the height of its crusade, more than eleven mil-lion church members signed pledges of support.The Legion of Decency exerted irresistible economicpressure. Faced with the potential loss of revenue fromsuch a large group of patrons at a time when the industrywas practically bankrupt, the majorsJuly l, 1934, Will HaYs and the boar eMPPDA amended and amPlified theJoseph I. Breen was placed in charge of the ProductionCo Rministration, tlte successor to the Studio RelationsCommittee, and having considerably more clout. His find-

Scarface; Shame of the Nation (United Artists, 1932), starring Paul Muni, AnnDvorak, and George Raft


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Part III / A Mature Oligopoly,:view only on apps. Breen's departctures with the knre Hays Oftce sealn aftliated theaterr subject to a $25,'s, of course, no piruld return its inv

.

picture could reach its full potentialr medium for the enrichment of'e published in Inglis' rcport, Free_

JII / A Mature oligopolv' 1930-1948 271

treating suchr extremistument, yet inthe opinion of the commission, the code defeated its ownpurpose by making it impossible for pictures to treat sexnaturally and honestly. And lastly, the report asked whyscreenwriters must invent "compensating moral values"

when they are lacking in real life.Thus, prodded by the Catholic Legion of Decency, Holly-wood directed its powers of persuasion to preserving tradi-tional concepts of morality. For the next generation, theindustry would produce the, "family" frlm, which addresseditself to the undifferentiated mass audience' Motion pic-tures might be technically polished and contain so-calledexpensive production values, but they would not deal inan honest fashion with the pressing concerns of an enlight-ened citizenry.The Labor Movement in HollYwood

The development of the studio system of production isinextricably linked to the rise of organized labor' As eachstep in the production process became departmentalizedand further subdivided, competing unions fought to winjurisdiction over ne\/ work funotions and to codify respon-sibilities. At the heyday of the era in 1946; labor was or-ganized into forty-three distinct craft and talent groups.The largest union group was the International Alliance ofTheatrical Stage Employees (IA), which had thirteen localsand over ten thousand members in Hollywood. IA con-trolled virtually every craft required to shoot a movie. TheConference of Studio Unions (CSU), with a membershipofseven thousand, controlled the preshooting crafts. Talentwas organized into the Screen Actors Guild, the Screen

recommendations were too idealis-rtion, two were ultimately actedrt guarantees were granted to thevertically integrated companiesrecommendations obviously wereimplementation create a renaissancehad hoped. Nonetheless, the com-e of the Production Code's effect:nt remains valid. The commissiono industry who complained that theany serious treatment of significantral issues. But it did not make aBreen Oftce. The report accused:hind the Production Code to avoid.


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27 ) Parr IIt / A Maturc Oligopoly. 930_t 94gWrilels Guild, the Screen f)ircctors Guild, and thc Amer_can Fcderation of Musicians. C)fficc employees, stry'a_lj,T;L, or tri srs, a nd orhcrs w er c or sani),. in ro *ii._i"l lrr'

Stirrings among the talcnt groups, especially the actors,led to rhe crearion of rhe e.o""nr'Motion picturc Arrsand Sciences in 1927. Conceived y-iori, fufuv"., rfr" "


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III / A Marure Otigopoly, 1930_194gDirectors Guild, and the Ameri-lns. Office employees, story ana_'s were organized into white_coliar

wood'st labor-gitation.rela-L the main. Labor peace wasI the Studio Basic Agreement informally recognized five impor-a mechanism for the arbitrationor won better working conditionsdios succeeded in keeping ant employees did not have to beo work. This fact pretty muchlfa strike since the studios couldrntral Casting Corporation, alsoof Hollywood extras. Movie-the country had flocked to Loslaking into pictures. A smallil work but only a handful steadyiubjected to all kinds of abusestgency fees, underpayment ofnent, and other forms of exploi-he source of many social prob-candal, Will Hays commissionedn to study the situation. Centralfrnanced by the MPPDA com-re name implies, the organiza-rghouse; extras could now call intrek to the studios, which wereand working conditions im-employment opportunities.re major respect; it did not find:housands of aspirants so thatcould enjoy at least a semblancet groups, especially the actors,cademy of Motion Picture Artseived by Louis B. Mayer, the

III / A Mature Oligopolv, 1930-1948 273e cate-writers,e givenzing

bombarded Washington with telegrams, held mass meet-

permanent suspension of the obnoxious provisions in theode. However, the guilds failed to receive recognitionas bargaining agents for the actors and writers or to sub-stantially improve the status of their members in theindustry.The itudios readily acceeded to the demands of the craftunions and the army of stagehands and technicians organ-in sesesa seoduction. As Larry Ceplair and Steven Englund remark,"On the surface, industry management appeared liberaland farsighted in granting concessions to well-establishedunions and technicians vital to the movie-making process'When the creative personnel who, if organized, might chal-lenge the studio system, however, formed guilds, manage-ment proved intransigent, shrewd, and unscrupulous."a

4.Lar.y Ceplair and Steven Englund, The Inquisition in Hollywood:Politics in the Film Community, 1930-1960 (Garden City, N.Y.: AnchorPress/Doubleday, 1980), p. 18.


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274 Part III / A Mature Oligopoly, 1930-194gAlthough stars earned salaries in excess sf six figures, thsplight of the regular actor was not as fortunate. The typicalweekly wage was $66. The workweek, however, consisteclof six days. Actors often worked past midnight and thenwere ordered to report back to the studio at 8 a.u.; theydid not receive overtime compensation or premium payfor Sunday and holidays. Nor did an actor enjoy continu-ous employment. He would be paid only for those daysactually worked during a shooting schedule that stretchedseveral weeks. Needless to say, therc was no machineryguaranteeing the impartial arbitration of disputcs for thoseunder contracts.For screenwriters, exploitation took the following form,which is described by Leo Rosten:For two dccadcs [192]-41] thc movic writers in the low salarybrackets (of whom wherc are plenty) were not given the protectionof minimum wages or minimum periods of employment. Theywere discharged with no advance notice; their employment wassporadic and their tenure short-lived. They were laid off for short-term periods, under contract but without pay. They worked onstories on which other writers were employed, without knowingwho their collaborators (or competitors) were. Their right toscreen credits was mistreated by certain producers who allottedcredit to their friends or relatives or-under pseudonyms-tothemselves. They were frequently offcred the bait of speculativewriting without either guarantces or protection in the outcome.sThe passage of the National Labor Relations Act in 1935theoretically gave unionization another boost in that theact restored many of the labor provisions of the invalidatedNRA code and specifically authorized collective bargain-ing. Hollywood producers, like management in otherindustries, simply ignored the act. Finally, after two years,the actors threatened a massive strike. This won recogni-tion for the Screen Actors Guild on May 15, 1937. Low-salaried players received most of the initjal benefits. 'Ihecontract set minimum rates of pay, guaranteed continuousemployment, and stipulated twelve-hour rest periods be-tween calls. Although successive contracts won concessionsfor all classes of performers, the relationship of the actorto the production process remained unaltered; in fact. it

5. Leo Rostcn, Iltlltt,ord: 7'hc Moyie (.tol1t al thc llovie tVakers(Ncw York: Harcourt, Bracc, l94l), p. 136.


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276 part III / A Marur.e Oligopoly. 1930-194gccoronic bc'cfts fronr thc NRA. thc opcn shop l.enrainedinracr. A fight over jurisdicron taunch. Uv iA i"jseemed to cripple the labodios and rival craft unioAs strikebreakers wcrc brmernbers flocked to joinAfterward, IA ceased toThe next year, howeveWilliam B. Brownc. theMachinc Opcralors Unlosonal reprcsentative, Broand professional hoodlurn wrinklc to the Hollywood laborstate his union, Browne usedppealcd to the theater projec_rhe paramo unl chain "n.. l"3 j,:i,i'::,:;19.36. Although paramount immedialely buckled, Browne,sprice for a srike se'tement was trigh_;.iJJ;'rli;.ment for all IA's former members -not only at paramountbut throughoul.lhe entire industry. Feeling ,lr. p**rr,'rhe studios capirutalecl. As a resur of tnc grel;.;i-i;.,mcmbership ju1p.j from thirty_three to twelve thousand.Browne and Bioff rhereupon lnstituted u -.f;;;il;,,by levy assessment on every IA paycheckand setseies o r 11i.#lilli1,1.studios, potent thrcat of u p.o.tionlri-ririt.to extract $100,000 bribes from company heads in retunfor either reducing wage demanJ, . no, making them atall. Throughout the.yers of Hoilywood's rabor troubres."the role of the studios was far i._ tt u, ;;" ;;;;;;,bystander," in the words of John gr.y. ..As employers,thc studio chiefs were very much invotvecl in behind_the_scenes manipularions, playing one [labor] c.";;ag;i;r;;"rher. when bribes were pai to wiic din ii ; ii,; -'^studio bosses who paid them. . . They [later] acknowl_edged that by agreeing 1o the nowne_iof ,u,rurrg._rtr,about wage-cuts and inc.eares, the niovie companies haclsaved approxiniatcly $15 million.,,6

^ 6 J-ohn oogrey, Report on hcklisrirt L. 7.he Movics(Func1 fbr trrcepubtic, 1956), p. 52.


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218 parr III / A Marurc Oligopoly, 1930_1943ducers, the Hollywood affiliate of the Hays Office, refusedto recognize a change in affiriation of the interio, ..r,o.,who voted to.oin the CSU, Although Sorrell ,u.r.rriutyappealed to rhe War Labor Board, the AMpp igoor.J in.ruling. perceiving this as a portent of the studios' "uin.after the war, Sorrell raunched a stike in March lqat-ir,uthiring IAmore violent, and thepicket rines. disrupt_ The strike, meanwhile, took on ideological overtones.Roy Brewer, who was sent in by IA Inteinational to takeover and direct strategy, labeled the strike ,,potitic,,-nAdistributed a barrage of leaflets attacking Sorrell . ""Communist associations" and support of ,,Communistcauses," Coming from a scandal_rien union, ,fr"r, poii,lcal attacks proved ineffective at frrst. The strike.n. ina stalemate, with most of the issues relegated to arbitraiion,which settled nothing. in 1946 over yety now, Brewer'shostilities marked

servative backtash against rhe legacy "r,fttff.*;i:;he domestic front. In catch_up ,io.n., to oflset the wartimewage freeze, workers in most industries ,tru.r. ln rlu.r,'prompting management toing anti-Communism, to wwood executives fought labmore closely with Brewer tto hire IA scabs. Brewer, for his part, further consolidatedhis power by aligning with right_;ing patriotic g.orpr, _or,notably the Motion picrure tiance-fr ,rtr p.r.,ion"of American Idears. This srrike dragged on for tril-;;.r,cSU picket rines dwindring as -.rib.., deser-ted to IA andthe assurance of work. Menwhile, the antilabor cause wasgiven a boosl when the House Co-itt.. on Un__"ri.nActivities investigated the alleged communist infrrtrationof the film indusrry in 1947 fJn. f S)- tsy 1949, Sorrelt and


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280 parr III / A Marurc Oligopoly, 1930_t94gdistributors could remove from the country; half of theirrmer revenues, or $17.5 milion, could be taken ou1 in1940, and only 912.9 million jn 1941.


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I III / ^ Maturc Oligopoly, I 930- 1948I from the country; half of their5 rnillion, could bc takcn out inlion in 1941.rch as thosc inrposcd bl,Greatto Amcrican distributors. Theyo quotas. taxes, contiugcnts, and: rise of nationalisrr in Europeas protcctionism for national llntlmericans had succcssfully foughtr in the past-with the hclp ol'theld bc notcd-thc war scverelymarket (ch. l7).thc war-torn Europcan counlr-ics,n America. There, although thcrpoly. thc markct had nevcr becn:tnrcnt of Statc aidcd Hollywoocl's:e of the Coordinalor of Inter-in October 1940. lts objectiveNcighbor Policy and to initiatebat pro-Axis sentiment in South; Motion Picture Divison almostrcctorship of John Hay Whitncy.to convincc the induslry torodthirsty Latin-An-rerican vil-to produce flnrs havrng Latin-tlcs. His sccond was to ncutralizcrrgentina, Brazil, and Chile froms, ncwsrccls. and documcnlalics.irecl Section for this purposc,d slrippcd to Sourh Amcrica:wsrccls ploduccd in c'oopelatiorrniversal, Fox, and Hearst's Newsreachcd an audience of morc944, according to CIAAca improved steadily during thc,xpecled. Several factors hclpbetwccn thc two conlirrcnts op-i'cquently than bcforc; sccond,which Hollywood churncd out inLning, had littlc nrass appeal;

pat III / A Maturc Oligopoly, 1930-1948

Wallace Bcery as Pancho Villa in Viva Villa (MGM, 1934)and third, national film companies, especially rn Mexico,stepped up their own production.T'he Domestic MarketBy the time America entered the war, it was apparent tothe industry that it would have to rely on the domesticmarket. Fortunately, conditions at home created a boom inbusiness. Dollars were plentiful, while commodities wcrenot. Movies were the most readily available enteainment.Although gasoline restrictions hurt attendance in somerural areas, the integrated companies, whose theatcrs wcremore favorably situated, flourished. Domestic film rentalsfor the eight majors jumped from $193 million in 1939to $332 million in 1946. As Variety noted, "Every nightwas Saturday night" at the movies. B pictures, low-gradepictures, pictures featuring unknown players-all com-manded an audience . Weekly attendance by thc end of thcwar reached ninety million, the highest ever.As business improved, pictures ran longer and longcr to

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t Part III / A Maturc Oligopoly, lg30_194gwith a significant result. The eight majorsures in 1939, but only 252 in t946. T;;;_-x, paramount, ancl Warner cut the pro_duction of B pictures in 1942. nlthough he decision wasi:ltl1:d_ in part by warrime rarionirig-oifilm stock, ii"ecame apparent early on that more and more dollarscould be earned from fewer un f.*eiiop_grade films.se during this period, to be sure, butmargins. paramount,s earnings, form $10 million in l94l to an incredibleThe industry contnued to operate during the war unfet-

James Cagney in yankee Doodle Dandt, (Warner Bros., 1942)

i;+ ".*L';*'#&g,lf *ir{- o*


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284 Palt III / A Maturc Oligopoly. 1930_194gthat governmcnt-sponsored films, sucl as tl.tc Why We.'z'gt serics, \rycre nothing -o.. hu,, political p.opugunOufor a Roosevelt fourth teim. The OWis U,,agct was slashc

Balio - A Mature Oligopoly

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