The Structure of American Film Industry

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Outline the main changes the paramount decree effected on the structure of the American film industry and discuss the measures the ex-studios took to remain in control of the film market. The period of the 1920’s to 1950’s where known as the studio era in Hollywood. A few major companies monopolized the industry through vertical integration when the film companies controlled all production distribution and exhibition. The majors determined which movies were shown in which theatres, choosing their own over others. The theatres were often palaces, about spectacle and a night out more than the movie itself. Marcus Loew said , “we sell tickets to theatres, not movies” (pg 113 , Hollywood cinema, Maltby R, 2003). The majors forced independent theatres into block booking their movies. If they wanted to purchase an individual movie from the producers they had to buy them in blocks, which often included some low budget and less popular movies. “The system worked in the distributors best interest by ensuring a wider distribution for lower budget movies and preventing independent exhibitors from buying only the most successful product”, (124, Hollywood cinema, Maltby R, 2003). The Paramount decree was passed in 1948 when the US supreme court ruled that the Hollywood majors control over distribution and exhibition of its product constituted an illegal monopoly and ruled that production and distribution be separated from the exhibition of movies. It marked the end of the studio era and the beginning of decades of changes in the industry made in order for the ex-studios to remain in control of the film market. After the paramount decree the Big Five studios , Twentieth century fox, MGM, Paramount, Warner Bros and RKO, were forced to sell off their theatre chains. The biggest problem the studios faced was that “the theatres had contributed more to profits than either production of distribution- production, of course, can only become a profitable activity as a result of distribution and exhibition” (pg7 Hillier J , 1992, The New Hollywood). Changes had to be made in order to make distribution of productions profitable. The studio system worked on permanent studio facilities with a highly paid roster of stars and an extensive payroll of technicians and staff. It soon became clear th... ... middle of paper ... ... The Sequel was often more expensive and less successful than its predecessor but provided a guaranteed profit. Studios recognized that outside their regular audiences most cinema goers did so only two or three times a year. These groups were often families attending during holidays , like Christmas, Easter or during the summer. Studios began releasing ‘event movies’. Big budget blockbusters, with promotional hype around them. The studios moved with the times and survived the Paramount decision. What had seemed a devastating blow at the time was accompanied by a huge drop in audience numbers with the advent of television and the population migration to the suburbs. The majors restructured, and were able to adapt in order to fit in with the changing times and remain profitable. “the overall changes which came in the wake of the consent decrees and other factors amounted essentially to a restructuring rather than a revolution and allowed the majors to retain command of the market.” (pg9 Hillier J , 1992, The New Hollywood). Its has been a long process of integration into the more diverse leisure industry we enjoy today.

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