Transformation of the Hollywood System

Book Title: The Oxford History of World Cinema. Contributors: Geoffrey Nowell-Smith - editor. Publisher: Oxford University Press. Place of Publication: Oxford. Publication Year: 1997

Transformation of the Hollywood System
DOUGLAS GOMERY

In the years after the Second World War, the Hollywood film industry underwent a major transformation. Increased competition from foreign films, the decline of cinema audiences, and attacks on the studio structure by government agencies led to a loss of revenue which crippled the American industry, and forced it into rapid and profound change. Perhaps the most important shift began in the late 1940s, when audiences at US movie houses began to fall. By the early 1960s they were half what they had been during the glory days, and thousands of formerly flourishing theatres had closed forever.
This decline cannot simply be blamed on the rise of television, as it began five years before television existed as a viable alternative to movie-going. After the Second World War there was a demographic and cultural shift in urban America that profoundly altered the leisure patterns of US society. People were cashing in the savings bonds accumulated during the war and buying houses in the suburbs, accelerating a trend which had begun at the turn of the century. This took away the demographic heart of the film-going audience. Suburbanization also raised the cost of going out to the movies; upon relocation it became inconvenient and expensive to travel to the centre of town simply to see a film.
The Hollywood studios were not oblivious to these trends. They saw the need to provide new suburban theatres, and, once the necessary building materials became available, began the process of constructing 4,000 driveins throughout the USA. The drive-in theatre offered a pleasant, open space where movie fans in parked cars could watch double features on a massive screen. By June 1956, at the very height of suburbanization and the baby-boom, for the first time more people in the USA went to the drive-ins than to traditional 'hard-top' theatres.
A more permanent solution arrived with the shopping centre theatre. As new malls opened in record numbers during the 1960s, the locus of movie attendance permanently shifted. With acres of free parking and ideal access for the car, shopping centres generally included a multiplex with five or more screens.
The shift of movie houses out of town centres and into the suburbs where the audience was now located did
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not, however, immediately halt the decline in attendance. Meanwhile, the shift itself created another problem for the Hollywood studios. The disappearance of the division between 'first-run' houses in town centres showing prestige pictures, and local neighbourhood cinemas, changed the pattern of film demand, necessitating a major change in the organization of film production.
A further blow to the stability of the studio system was delivered by the government. The years immediately after the war saw the culmination of federal anti-trust action against the Hollywood studios; a campaign that had started in the 1930s, but had been temporarily halted by the war. The studios had fought hard against attempts to break up their vertically integrated systems of production, distribution, and exhibition. They appealed the case all the way to the Supreme Court; but 1948 proved to be the end of the road, and, in what became known as the 'Paramount decision', the court ruled for the divorce of production and exhibition, and the elimination of unfair booking practices. During Hollywood's 'golden age' the major studios had directly controlled their own destinies by owning the most important theatres. Now they were forced to sell these off, and split their companies in two; one division handling production and distribution, the other grappling with the decline and change of the theatre business. The 'golden age' was over, and a new era loomed.
The Hollywood studios still retained a significant measure of direct control through international distribution. The 'Paramount decision' wounded Hollywood, but did not break it. Although the major companies would have adjusted far better to the new conditions had they retained their theatres, they still held sway as long as they produced what exhibitors wanted.

CHANGES IN PRODUCTION
Hollywood looked to innovation and new technology to tempt patrons back to the theatres. Films were designed on a spectacular scale, clearly superior to the black and white video images broadcast into the home. The first of the 'new' film technologies, colour, had long been available to the movie industry. In 1939 Technicolor had lit up the screen in Gone with the Wind, but throughout its early years had only been employed for a select group of features, principally historical epics and lavish musicals. In 1950 Technicolor lost its market monopoly as a result of anti-trust laws, and the giant Eastman Kodak soon surged into the market, introducing Eastman Color, which required only one, not three separate negatives. The studios brought out Eastman Color under a variety of names, and by the early 1960s virtually all Hollywood movies were being made in colour.
In 1952 the Hollywood studios went one step further, and made their movies bigger. Cinerama offered spec-
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tacular widescreen effects by melding images from three synchronized projectors on a vast curved screen. To add to the sense of overwhelming reality, it also included multi-track stereo sound. However, theatres which contracted for the new process were required to employ three full-time projectionists and invest thousands of dollars in new equipment, and this financial outlay proved too much for most.
The process for creating 3-D effects had been around since the 1920s. In 1952 Milton Gunzburg and Arch Oboler launched Bwana Devil, a crude African adventure story starring Robert Stack. The narrative and stars may not have been top drawer, but the 3-D effects, advertised as 'A lion in your lap', caused a stir. During 1953 and into 1954, 3-D was hailed as the saviour of the Hollywood film industry, and the studios rapidly produced their own versions to ensure that they were not left behind. Warners issued what was to be the most successful of these efforts, House of Wax ( 1953), and classic genre fare followed: MGM's musical Kiss me Kate ( 1953), Columbia's crime tale Man in the Dark ( 1953), and Universal's science-fiction feature The Creature from the Black Lagoon ( 1954). However, the complication of special 3-D attachments to projectors, and the inconvenience of the glasses which had to be issued to patrons, meant extra expense that was never fully matched by the extra take at the box-office.
What the Hollywood studios needed was a widescreen process without the added complications of 3-D, or the prohibitive investment of Cinerama. Fox's CinemaScope seemed the answer; a widescreen process which used an anamorphic lens to expand the size of the image. The first CinemaScope film, The Robe ( 1953), an overblown biblical tale, starring Richard Burton and Jean Simmons, dazzled audiences and a rosy future seemed in sight.
By the end of 1953 every major studio, except for Paramount with its rival VistaVision process, had jumped on the CinemaScope bandwagon. Within a year, half the theatres in the USA were showing CinemaScope, but again equipping theatres proved more expensive than had been anticipated and profits were difficult to maintain.
Other processes were tried, and rejected, including Todd-AO for Oklahoma! ( 1955) and Around the World in Eighty Days ( 1956). The long-term solution to widescreen images eventually came from the Panavision Company. Robert Gottshalk perfected anamorphic projection attachments that permitted flexible filming and little additional expense for the theatre owner. One could summon up a variety of anamorphic power with a simple turn of a knob. By the late 1960s Panavision had become the industry standard.

THE PACT WITH TELEVISION
Throughout this period of transition in Hollywood, the major studios had stonewalled the television industry, refusing to sell or rent feature films to the small screen. However, minor movie companies, always looking for easy profits, did offer their wares. In 1951, for example, Columbia Pictures established Screen Gems as a wholly owned subsidiary to proffer filmed material to TV. The smaller Hollywood studios also rented their back lots to fledgeling TV producers, and unemployed film actors and craftspeople took up television work.
The first feature films shown on US television came from abroad, the bulk from struggling British film studios, like Ealing, Rank, and Korda. Unable to break into theatrical exhibition in the USA, and unwilling to release their product for TV screening at home, the British capitalized on American television's eagerness to show any available filmed entertainment.
It was eccentric billionaire Howard Hughes, owner of RKO, who broke the log jam and sold RKO's film library to TV in 1954. Millions of dollars were made in this deal, and this impressed even the most recalcitrant movie mogul. In the next two years, all the remaining major Hollywood companies released their pre-1948 titles to television. (These titles did not require the payment of residuals to performer and craft unions.) For the first time, a national audience was able to view, at its leisure, a broad cross-section of the best and worst of Hollywood talkies.
From this point on, black and white films functioned as the mainstay of innumerable 'Early Shows', 'Late Shows', and 'Late, Late Shows'. A decade later more than 100 different films were aired each week on New York television stations.
In 1955 the majors plunged ahead into producing specifically for television. Warner Bros. led the way with Cheyenne, 77 Sunset Strip, and Maverick, all series based on scripts and films the studio already owned. Almost overnight, Hollywood replaced New York as the centre of television production and by 1960 film companies supplied the majority of prime-time fare, from TV series to feature films shown every night of the week.

THE FIGHT FOR SURVIVAL
The new economic conditions in the 1950s could not be faced simply by moving into television production; major changes in the structure of the studios were also inevitable.
The studios also readjusted by shedding their in-house production lines. The talent that had been kept on the books during the classical era now proved too expensive, and independent producers were contracted in to make features. Foreign markets also became increasingly important as the domestic market contracted, and the studios concentrated more on distributing their films around the world. These changes ensured the survival of all the major Hollywood studios, except RKO. However, in the ups and downs of the transformation, the studios'
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rankings changed, and the grand leaders, like MGM, struggled to fight on equal terms with formerly minor theatre-less companies, like Columbia or Universal.
MGM faced the greatest threat to survival. Long-standing head Nicholas Schenck clung to 'his' theatres long after all the other majors had sold out, and it was 1959 before the company split into two, with MGM making movies and Loew's exhibiting them. This period saw the departure of many of the bosses of the 'golden age': Louis B. Mayer, Dore Schary, Arthur Loew; and violent corporate struggles for power racked the through the late 1950s.
Farley Granger and Cathy O'Donnell on the run in They Live by Night, Nicholas Ray's first feature, made for RKO in 1948. By 1965 the once-mighty MGM was a shell of its former self, and in 1969 investor Kirk Kerkorian bought MGM solely for its 'Leo the Lion' symbol for his new Las Vegas hotel. Senior executive James T. Aubrey, Jr., formerly with CBS, cancelled the films that were about to enter production, sold off the back lot, and began churning out low-budget movies. Some, like the black exploitation film Shaft ( 1971), made money; most did not. In October 1973, just before he resigned, Aubrey ended MGM's role as distributor; the once-mighty Leo the Lion was out of the movie business and would remain so for almost a decade.
MGM was not the only great Hollywood studio to encounter troubles in the 1950s; Warner Bros. was also
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forced to struggle for survival. In July 1956 founding brothers Harry and Abe Warner sold their shares, and Jack only stayed on to help the new owners move quickly into the TV production business. With the development of the pioneering series 77 Sunset Strip and Maverick, the languishing Warner lot hummed once again. But Warner the movie company was unable to attract hits from independent producers. For every success like Camelot ( 1967) or The Great Race ( 1965) they backed dozens of failures. Warners' balance sheet moved deeply into the red, and Seven Arts Productions Ltd. of Canada took over.
In July 1969 Kinney National Services Inc., a New York conglomerate dealing in parking lots and funeral homes, purchased Warners. In his rush for new acquisitions, Steven J. Ross moved to fashion the ultimate media conglomerate, Warner Communication. From John Wayne's independent company, Batjac, and a string of successes from other quarters including Deliverance ( 1972), What's up Doc? ( 1972), and The Exorcist ( 1973), Warner Bros., now a mere division of the mighty Warner Communication, settled into a period of consistent earnings. Paramount had been Hollywood's most profitable studio, with the largest theatre chain in film history. This had ended in 1949, when Barney Balaban, the long-time president, seeing no reason to fight the Supreme Court's rulings, split his empire in half. Paramount Pictures retained ownership of the production and distribution arms, and throughout the 1950s followed a fiscally conservative strategy. When 20th Century-Fox successfully developed CinemaScope, Balaban countered with Paramount's less expensive VistaVision, a process which could be used on traditional projectors and thus required a smaller investment on the part of the exhibitor.
However, the hits stopped coming, and in 1963 Paramount made a loss for the first time; Balaban retired a year later and take-over attempts commenced. In autumn 1966 a giant conglomerate, Charles Bluhdorn's Gulf + Western Industries, bought Paramount. Bluhdorn installed himself as president and hired former press agent Martin S. Davis to run things in New York and former actor Robert Evans to revitalize the studio. By 1972, and Francis Ford Coppola's The Godfather, the new Paramount was once again churning out profits, but now for its parent company, Gulf + Western.
20th Century-Fox also faced financial problems despite its innovation of CinemaScope, used to particular effect in the Marilyn Monroe films of the 1950s. The company was still robust in 1956 when long-time studio boss Darryl F. Zanuck resigned to enter independent production. In 1963 Zanuck was called back to try and rescue the company after the financial disaster of Cleopatra. But the management techniques that Zanuck had employed so successfully in the 1930s and 1940s did not measure up in the 1960s. The Sound of Music ( 1965) proved only a temporary
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saviour; the multi-million dollar failures of Doctor Dolittle ( 1967), Star! ( 1968), Hello, Dolly! ( 1969), and Tora! Tora! Tora! ( 1970) best characterize this era of corporate misery. In 1970 20th Century-Fox lost a record $77 million, and Zanuck was fired. During the early 1970s, the new MBA managers, led by Dennis Stanfill, regained Fox's profits and position in the studio hierarchy, through a policy of producing star-studded, high-action blockbusters, such as The French Connection ( 1971), The Poseidon Adventure ( 1972), and The Towering Inferno ( 1974).
Columbia, like Universal and United Artists, did not own a string of theatres, and so was less affected by the changes of the 1950s. As a smaller-scale company, it was also more flexible, and adapted to the move to an independent producer system with relative ease. From independent movie-makers Fred Zinnemann, Elia Kazan, Otto Preminger, Sam Spiegel, and David Lean, Columbia produced hits like From Here to Eternity ( 1953), On the Waterfront ( 1954), The Caine Mutiny ( 1954), and The Bridge on the River Kwai ( 1957). This success continued into the 1960s. Abe Schneider and Leo Jaffe succeeded Harry and Jack Cohn, and acquired Lawrence of Arabia ( 1962), A Man for All Seasons ( 1966), Guess who's Coming to Dinner ( 1967), To Sir, with Love ( 1967), In Cold Blood ( 1967), Oliver! ( 1968), and Funny Girl ( 1968). As well as working with established film- makers, Columbia found hits in unexpected places. In 1969 it released Easy Rider, which cost less than half a million dollars, and made stars of Jack Nicholson, Dennis Hopper, and Peter Fonda. The lack of a large, rigid, vertically integrated studio structure had been disadvantageous to Columbia in the 1930s, but proved to be the way to make millions in the new Hollywood system.
This was confirmed by Universal, which had been only marginally profitable during the golden age of the 1930s and 1940s. When the company was sold in 1952 to Decca Records, Edward Muhl looked for independent deals to match those made by Columbia. He signed James Stewart and Anthony Mann for Winchester'73 ( 1950) and Bend of the River ( 1951), as well as making deals with Tyrone Power, Gregory Peck, and Alan Ladd. Universal did so well that the MCA talent agency, under super-agent Lew Wasserman, bought it and created a Hollywood power-house of television production. Wasserman also attracted such filmmaking talents as Alfred Hitchcock, Clint Eastwood, Robert Wise, and Steven Spielberg. Indeed, by the time Universal released Spielberg's blockbuster Jaws in 1975, it had reached the top of the studio pile.
United Artists entered the 1950s in the worst shape of any major movie company. Awash in red ink, founders Charlie Chaplin and Mary Pickford sold out to a syndicate headed by two New York entertainment lawyers, Arthur Krim and Robert Benjamin. Timing could not have been better for the New York wunderkinds, who wooed independents Stanley Kramer, John Huston, Burt Lancaster, Billy Wilder, John Sturges, and Otto Preminger. Benjamin and Krim handled the financing, distribution, and publicity, freeing these creative talents to make movies. Krim and Benjamin ultimately cashed in on the conglomerate boom of the 1960s, and made millions selling out to Transamerica Company, although they stayed on to run the United Artists division.
The one new major Hollywood player to emerge during this period was the Walt Disney Corporation. This studio had existed on the fringes of the film industry since the 1920s, specializing in animation, but in 1953 formed its own distribution arm, Buena Vista. To feed this new channel, Disney commissioned family films, like 20,000 Leagues under the Sea ( 1954) and Mary Poppins ( 1964), as well as regularly releasing (and rereleasing) such classics as Snow White and the Seven Dwarfs ( 1938) and Pinocchio ( 1940).

THE PRODUCT
Young people, the baby-boomers, came to dominate the theatrical audience during this era; and consequently, their expectations and desires increasingly influenced the types of films released. To broaden its audience base, Hollywood loosened and reorganized its censorship standards; in November 1968 the United States became the last major western nation to institute some kind of systematic age classification of motion pictures, with the 'G', 'PG', 'R', and X ratings.
The new economic order in Hollywood did not mean that the classical Hollywood narrative style was jettisoned. Genres changed, new film-makers entered the system, and Hollywood moved from studio to independent production, but the story-telling form of the films remained much the same. Hollywood took on more daring themes, but crafted them in the classical style. The director was now touted as an artist, identified and praised as the centre of the creative process, and, in general, film-makers and stars gained more control over the films with which they were involved. However, the economic basis of the Hollywood industry remained the regular production of genre films, those most easily sold on a mass scale around the world.
Television did alter the way Hollywood made movies, in aesthetic, as well as institutional terms. In the 1960s, after it became clear that television was a major market for features, film-making was forced to become visually simpler. The centre of the frame (for both widescreen and standard ratio) became the focus of all but the least important narrative actions, so that it could be seen on a television rebroadcast. The classical Hollywood cinema, which had been created to offer a narrative flow without interruption, had to learn to accommodate an audience's casual use of TV, and the breaks demanded by advertisers.
Many directors formed their own companies, producing films to be distributed through the majors. New models
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of production from Europe added another dimension to Hollywood film-making, at least on the margin; Hollywood learnt, absorbed, and adapted European art cinemas, and so altered the look of American narrative cinema. There was a looser, more tenuous linkage of narrative events for which absolute closure was not necessary. Stories were located in real settings and dealt with the contemporary (often psychological) problems of confused, ambivalent, and alienated characters. Whereas characters in the classical Hollywood cinema had to be well rounded, operating with clear-cut motives and characteristics, the European influence allowed for the possibility of confused characters, without obvious goals. At the same time strict rules on continuity editing were relaxed and jump cuts gave a new look to comedies and sequences of violence.
However, the Hollywood institutional structure would not permit film-makers to fashion a style totally removed from the tenets of the classic Hollywood text. Continuity of time and space remained in force, with any radical departures encompassed within genre conventions, primarily of comedy. The European cinema may have provided alternatives which gave Hollywood a new faqade, but it never seriously shook the foundations of the classical Hollywood form.
The television age proved to be an era of transition; the old studio system was supplanted by a more flexible means of independent production, and the last of the veterans from the silent era were replaced. The old-style studio moguls, who had guided the great Hollywood companies for decades, proved unable to adapt to the necessities of the new era. However, a number of great film-making talents, with long experience in the industry, led Hollywood through the changes. Indeed, John Ford, Howard Hawks, and Alfred Hitchcock, among others, produced some of their best work during the early years of the television era.

Bibliography
Bordwell, David, Staiger, Janet, and Thompson, Kristin ( 1985), The Classical Hollywood Cinema.
Gomery, Douglas ( 1986), The Hollywood Studio System.
---- ( 1992), Shared Pleasures.
Schary, Dore ( 1979), Heyday.
Schatz, Thomas ( 1988), The Genius of the System.