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Solved by verified expert:Please do the reading and answer the four questions. You may write one page of each questions. PLEASE USE THE SIMPLE LANGUAGE!! THANKS Here is the questions :1.Blockbuster film – why was it important in 70s and 80s – what films were key – Sklar and Schatz – what do it do, at least two characteristics of, how it reshaped the film industry 2.Independent filmmaking – Sklar, Perren – different versions of – characteristics of indie films – when they emerged (Late 60s, early 70s, new hollywood), Bonnie and Clyde, the 90s -Sex lies and Videotape – how it adapted to indie blockbusters – what did it do the film industry in the 90s 3. What is synergy – why is it central to the film industry – how does it related to the way studios are structured now – talk about conglomerate Hollywood – why are family films suited to synergy 4. Think something your own idea. – What “Hollywood’ mean? How to define? How they adapt to challenge? (You can be positive or negative) self-reservation
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PART I
THE STRUCTURE OF
THE INDUSTRY
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CHAPTER 1
THE STUDIO SYSTEM AND
CONGLOMERATE HOLLYWOOD
TOM SCHATZ
Introduction
In August 1995 Neal Gabler, an astute Hollywood observer, wrote an op-ed piece
for The New York Times entitled “Revenge of the Studio System” in response to recent
events that, in his view, signaled an industry-wide transformation (Gabler 1995).
The previous year had seen the Seagram buyout of MCA-Universal, Time Warner’s
purchase of the massive Turner Broadcasting System, and the launch of DreamWorks, the first new movie studio since the classical era. Then on August 1 came
the bombshell that provoked Gabler’s editorial. Disney announced the acquisition
of ABC and its parent conglomerate, Cap Cities, in a $19 billion deal – the secondlargest merger in US history, which created the world’s largest media company. Disney
CEO Michael Eisner also disclosed a quarter-billion-dollar deal with Mike Ovitz of
Hollywood’s top talent agency, Creative Artists, to leave CAA and run the Disney empire.
For Gabler, the Disney deals confirmed “a fundamental shift in the balance
of power in Hollywood – really the third revolution in the relationship between
industry forces.” Revolution I occurred nearly a century before with the formation
of the Hollywood studios and the creation of a “system” that enabled them to control the movie industry from the 1920s through the 1940s. Revolution II came with
the postwar rise of television and the dismantling of the studio system by the courts,
which allowed a new breed of talent brokers, “most notably Lew Wasserman of the
Music Corporation of America [MCA],” to usurp control of the film industry. In
the early 1960s, MCA dissolved its talent agency and purchased Universal Pictures,
creating a precursor of sorts to the modern media conglomerate. MCA-Universal
spearheaded an industry-wide recovery in the 1970s and 1980s, spurred by the deft
integration of its film and television divisions and by a new breed of blockbuster
films. Leading stars and independent filmmakers still enjoyed unprecedented
power and freedom, and so the studios had to share their power with top talent
and their agents – most notably the powerhouse agencies like William Morris and
Ovitz’s CAA, which not only represented talent, but actively “packaged” many of
Hollywood’s biggest films.
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By the 1990s, however, the combined forces of media deregulation, globalization,
and new digital technologies were tipping the balance of power back to the studios,
thus auguring Revolution III. Disney and the other studios “may have finally found
the holy grail,” wrote Gabler. “By combining movies, broadcast television, video,
foreign video, foreign television, merchandizing, theme parks, soundtrack albums,
books and heaven knows what else, Mr. Eisner has devised a new form of vertical
integration that takes virtually all of the risk out of movie software.” This meant
huge paydays for top talent in the short term, but the long-term prognosis for both
filmmaking talent and films themselves was bleak. “When risk is vanquished, when
even awful movies can be profitable, the stars lose their leverage,” opined Gabler,
and he closed with a bold assessment of Ovitz’s jump to Disney: “The agencies and
their clients are no longer the 800-pound gorillas. The studios are back in power.
Why else would the greatest agent of them all defect to the enemy?”
In the years that followed, it became obvious that Gabler got it only half-right.
There had been a significant power shift in Hollywood, and the Powers That Be
were indeed devising new modes of vertical (and horizontal) integration to minimize risk and maximize profits. But the power scarcely resided with the studios of
old. The new rulers of Hollywood – and of the global entertainment industry at
large – were not the studios but their parent companies, the media giants like Viacom
(owner of Paramount Pictures), Sony (Columbia), Time Warner (Warner Bros.),
and News Corp. (20th Century Fox), which controlled not only the movie industry but the US television industry as well. Disney, the one studio that had not merged
with or been swallowed by a media giant, had in fact become one. “Disney isn’t as
much a company as it is a nation-state,” said Ovitz of his new employer, in an apt
analogy that applied to all of the new global media powers (Bart, 1996).
This tectonic shift in the structure and economics of Hollywood actually began
a decade earlier when News Corp. bought 20th Century Fox and launched the Fox
Broadcasting network. That created a paradigm for the global media giants to come,
as the burgeoning New Hollywood steadily morphed into Conglomerate Hollywood,
and as the studios’ role in the industry drastically changed. The studios were vital
to their parent companies’ media empires, of course, since Hollywood-produced
blockbusters have been the driving force in the global entertainment industry. But
the movie studios, along with the conglomerates’ “indie film” divisions, television
and cable networks, and myriad other holdings, have become players a game they
no longer control.
The Rise and Fall of the Classical Hollywood Studio System
To understand and assess the state of the studio system in contemporary Hollywood,
we need to trace its earlier development, along with the complex evolution of the
studios themselves and their singular product, the feature-length motion picture.
During the classical era, from the 1920s through the 1940s, the “studio system” referred
both to a factory-based mode of film production and also, crucially, to the vertical
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integration of production, distribution, and exhibition. The studio system coalesced in the 1910s and early 1920s via expansion, merger, and acquisition, and
by the 1930s the film industry had evolved into what economists term a “mature
oligopoly” – that is, an industry effectively controlled by a cartel of companies
(Balio, 1976/1985; Bordwell, Staiger, and Thompson, 1986; Gomery, 1986; Finler,
1988; Schatz, 1988).
Control of the movie industry was exercised by the so-called Big Eight studios,
whose filmmaking factories in Hollywood fed their nationwide distribution operations. The most powerful of these firms were the fully integrated Big Five studios
– MGM, Warner Bros., 20th Century Fox, Paramount, and RKO – which not only
produced and distributed films but operated their own theater chains as well.
Meanwhile, the Little Three “major minor” studios – Universal, Columbia, and United
Artists (UA) – produced and distributed top feature films but did not own their
own theaters. Universal and Columbia were full-fledged movie factories but
produced fewer A-class features because they lacked the financial leverage and filmmaking resources of the Big Five. UA was an anomaly among the studios in that
it simply provided financing and distribution to top independent producers like
Sam Goldwyn and David Selznick. The 1930s also saw the emergence of several
“poverty row” B-movie mills like Monogram and Republic, which were incidental
to the studio system since they did not produce A-class features and did not distribute their own films.
The studio system flourished during the Depression and World War II, two national
crises that induced the government to sanction (or at least tolerate) the studios’
monopolistic control of the film industry. This enabled the studios to maintain their
factory operations as well as a “contract system” that kept filmmaking talent at all
levels, from top stars to stagehands, directly tied to the company. Studio management was a classic top-down affair, with the primary power emanating from the
home office in New York, which controlled distribution and exhibition (i.e., sales),
and passing on to the studio on the West Coast, whose top executives supervised
the overall operation of the plant while a corps of supervisors (eventually dubbed
“producers”) oversaw the production of individual films. The mainstay of the
studio system was the A-class feature film, invariably a formulaic “star vehicle” with
solid production values and a virtually guaranteed market. The studios also turned
out occasional big-budget “prestige pictures” as well as a steady supply of low-cost
B-movie fare that comprised up to half their output in the 1930s, which totaled
roughly 50 pictures per week and was sold in entire “blocks” to the nation’s
exhibitors. But it was A-class star-genre films that drove the entire studios system
as it reached full maturity during the 1930s and Hollywood entered its legendary
Golden Age. Moreover, these star-genre cycles were the basis for each studio’s distinctive “house style,” which was fundamentally geared to its internal resources, its
stables of contract talent, and its overall market strategy.
The 1940s proved to be a watershed era for Hollywood, with an unprecedented boom
due to war-related social and economic conditions early in the decade, followed
by a drastic industry decline and an abrupt end to the studios’ long-standing
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hegemony. The war boom peaked in 1946, the studios’ best year ever in terms of
revenues and profits, but by 1947–8 the industry was in a veritable free-fall due to
a succession of devastating blows. Foremost among these was the Supreme Court’s
1948 Paramount decree, an antitrust ruling that resulted from persistent legal
challenges by independent exhibitors, which forced the Big Five studios to sell their
theater chains and prohibited the collusive trade practices that were crucial to the
studios’ control of the motion-picture marketplace. Another was the rapid growth
of television, which was propelled by sustained economic prosperity and wholesale
changes in postwar American lifestyles – most notably suburban migration and the
so-called baby boom. In the span of a decade, “watching TV” replaced “going to
the movies” as America’s dominant form of habituated, mass-mediated narrative
entertainment.
The studios responded – and ultimately survived – by fundamentally changing
the way they made movies and did business, thus establishing a modus operandi
that still prevails today. Adopting and modifying the UA model, the studios concentrated on financing and distribution rather than production. Lacking the financial resources and contract talent to mass-produce movies for a declining market
they no longer controlled, the studios now relied on independent producers to
supply “packaged” projects that the studios would “green light” for production, putting
up some portion of the budget in exchange for the distribution rights, and often
leasing out their production facilities as well. This meant ceding creative control
to independent producers and freelance directors, and also to top stars whose
“marquee value” gave them tremendous leverage and frequently a share of the profits.
This also gave considerable power to the leading talent agencies like William
Morris and MCA, with the latter becoming particularly adept at setting up independent companies for its clients. The studios still generated their own films, but
they produced fewer, “bigger” pictures – biblical epics and wide-screen Westerns
during the 1950s, for instance – which made more sense economically and laid the
groundwork for the blockbuster mentality that now prevails.
The Television Era and the New American Cinema
By the mid-1950s all of the studios had weathered the postwar storm except RKO,
which was bought by Howard Hughes in 1948 and subsequently mismanaged and
dismantled. RKO was essentially defunct by 1957, when the lot itself was purchased
by Desilu, the independent television production powerhouse owned by Desi
Arnaz and Lucille Ball (of I Love Lucy fame), two former RKO contract players.
The rise of Desilu had considerable impact on the Hollywood studio system, in that
it pioneered “telefilm” series production based on the West Coast, providing a model
of sorts for the studios’ profitable pursuit of TV series production. The surviving
major studios – MGM, Paramount, Warner Bros., and 20th Century Fox – actively
resisted telefilm production until 1954–5, when both Columbia (via its Screen Gems
subsidiary) and Disney (via its hugely successful “Disneyland” series) had hit series
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THE STUDIO SYSTEM
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on prime-time network television. RKO also began selling its old films to TV
syndication companies in 1955, providing further impetus for the majors’ reconciliation with the upstart industry. In 1955–6 the major studios finally acquiesced,
as they began reissuing older films for syndication and, even more importantly,
moved headlong into telefilm series production. By 1960 the center of television
production in the US had shifted from New York to Hollywood and the studios were
turning out far more hours of TV series programming than feature films, having
reactivated their B-movie operations to feed TV’s voracious appetite for programming. In 1960 the networks also started running Hollywood movies during prime
time, which added enormous value to the studios’ “libraries” of theatrically
released films (Schatz, 1990; Anderson, 1994; Hilmes, 1999).
Despite their growing rapport with the TV industry, the studios struggled
during the 1960s due mainly to the continued erosion of the mainstream audience
and the over-production of big-budget epics and musicals (in an effort to retain
that audience), resulting in a decade-long run of spectacular hits and misses. 20th
Century Fox, for instance, careened from financial desperation with Cleopatra
(Joseph Mankiewicz, 1963, US) to monumental success with The Sound of Music
(Robert Wise, 1965, US), then saw costly failures like Doctor Dolittle (Richard Fleischer,
1967, US), Star! (Robert Wise, 1968, US), Hello, Dolly! (Gene Kelly, 1969, US), and
Tora! Tora! Tora! (Richard Fleischer, Kinji Fukasaku, 1970, US) generate net losses
of over $100 million in 1969–70, driving the company to the brink of bankruptcy
(Finler, 1988: 100). The 1960s also saw an unprecedented surge in film imports and
international co-productions, a trend that had been growing throughout the postwar era, and one which threatened the studios’ control of the marketplace as well
as their narrative and stylistic traditions. These imports ranged from high-cost prestige pictures and art films to low-budget exploitation films, many of them co-financed,
co-produced, or simply released by one of the studios. UA was by far the most aggressive and successful in pursuing such deals, which included prestige films like Tom
FIGURE 1.1 Cleopatra (1963), an expensive failure for Fox. Produced by Walter Wanger;
distributed by 20th Century Fox; directed by Joseph L. Mankiewicz
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TOM SCHATZ
Jones (Tony Richardson, 1963, UK), the Beatles-starring A Hard Day’s Night
(Richard Lester, 1964, UK) and Help! (Lester, 1965, UK), the enormously successful James Bond cycle, and the Sergio Leone-directed “spaghetti Westerns” starring
Clint Eastwood (Balio, 1987).
During the late 1960s Hollywood began generating an art cinema of its own, spurred
by the wave of imports, the demise of the Production Code in 1966–7, and the coming of age of the postwar “baby boom” generation – not only as a distinctive (and
distinctly counter-cultural) moviegoing market, but a new generation of filmmaking talent and studio executives as well. Propelled by the success of Bonnie and Clyde
(Arthur Penn, 1967, US) and The Graduate (Mike Nichols, 1967, US), and aptly
termed the New American Cinema by critics and historians, the late 1960s and early
1970s saw the rapid emergence of a director-driven, youth-oriented, art-cinema movement that defied the conventions of classical Hollywood narrative, subverted its genre
traditions, and openly challenged that studio-controlled mode of production. All
of the studios supported the movement, mainly due to the reliability of the youth
market, with Paramount, Columbia, and Warner Bros. taking the most aggressive
tack. Paramount’s releases included Rosemary’s Baby (Roman Polanski, 1968, US),
Love Story (Arthur Hiller, 1970, US), and The Godfather (Francis Ford Coppola,
1972, US). Columbia’s included Easy Rider (Dennis Hopper, 1969, US), Five Easy
Pieces (Bob Rafelson, 1970, US), and The Last Picture Show (Peter Bogdanovich,
1971, US). Warner Bros., under the leadership of John Calley, was the most
significant contributor to the New American Cinema, producing Bonnie and Clyde
and Bullitt (Peter Yates, 1968, US), The Wild Bunch (Sam Peckinpah, 1969, US),
Woodstock (Michael Wadleigh, 1970, US), A Clockwork Orange (Stanley Kubrick,
1971, UK), Dirty Harry (Don Seigel, 1971, US), McCabe and Mrs. Miller (Robert
Altman, 1971, US), Klute (Alan Pakula, 1971, US), Deliverance (John Boorman, 1972,
US), Mean Streets (Martin Scorsese, 1973, US), Badlands (Terrence Malick, 1973,
US), and The Exorcist (William Friedkin, 1973, US). This Hollywood new wave proved
to be a decidedly mixed blessing for the studios, however, since these films enjoyed
the allegiance of the youth market and the adulation of critics but rarely enjoyed
cross-over success with mainstream moviegoers and tended to be unsuitable for
network television.
While the New American Cinema was geared to a new generation of filmmakers and moviegoers, the industry at large underwent significant changes due
to a new breed of studio owner. In the course of the 1960s, five of the seven Hollywood
studios – Universal, Paramount, Warner Bros., UA, and MGM – changed ownership in a merger-and-acquisition wave unlike any since the formation of the studio
system a half-century earlier. Spurred mainly by the studios’ depressed stock value,
this wave was quite distinctive in that all of these were straight buyouts (acquisitions, not mergers), and four of the five purchasing companies had no experience
of – and little interest in – media entertainment. The only studio acquisition
involving a media-savvy buyer was the first of the five buyouts: the 1962 purchase
of Universal Pictures and parent company Decca Records by MCA, Hollywood’s
top talent agency and also its leading television program supplier through its
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THE STUDIO SYSTEM
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Revue division. When it bought Universal, MCA dissolved its talent agency (at the
insistence of the Justice Department) to concentrate on film and television production,
distribution, and syndication. MCA-Universal weathered the industry’s 1960s
downturn thanks to its successful integration of film and television production, which
included the launch of the made-for-TV movie format in a historic pact with NBC,
and its continued dominance in telefilm series production (Thompson, 1960;
Bruck, 2003).
While the MCA–Universal union was a model of “synergy” – i.e., the coordination of its various media divisions – the other 1960s buyouts involved studio acquisitions by large non-media conglomerates: Paramount by Gulf + Western in 1966;
UA by Transamerica in 1967; Warner Bros. by Seven Arts in 1967 and then by Kinney
Corporation in 1969; and MGM by Las Vegas mega-developer Kirk Kerkorian in
1969. The Paramount, UA, and Warner Bros. deals involved diversified, deeppocketed parent companies that enabled the studios to continue operations despite
the industry-wide recession. Kerkorian, however, was a financier and real-estate tycoon
interested in MGM for its brand name and its library, and with no inclination to
underwrite its failing movie pr …
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