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The American Film Industry in the Early 1950s

Industry-Wide Problems

The Hollywood film industry of 1950 was threatened on several different fronts. Television broadcasting was rapidly becoming the dominant entertainment medium in the United States. The Paramount anti-trust consent decree requiring separate ownership for production companies and theater chains had gone into effect on 1 January 1950. Large numbers of young men and women were marrying, having children, and moving to the suburbs, which affected the viability of downtown first-run movie theaters. Foreign revenues were endangered by protectionist tactics including quota systems, high taxes, and blocked funds. Finally, the morality and patriotism of Hollywood films and filmmakers were under attack from government, religious, and citizens' groups.

One quick way to get a sense of the film industry's declining fortunes in the early 1950s is to consider box-office statistics. Unfortunately, all such data is approximate. Table 1 presents three versions of the average weekly motion-picture attendance in the United States. The most widely quoted source, the U.S. Census Bureau, shows that weekly attendance dropped from 80 million in 1940 and 90 million in 1946 to 60 million in 1950 and 40 million in 1960. Another, possibly more precise, set of figures comes from the Theatre Owners of America (TOA), and covers only 1946-1956. Here, the 1946 peak is lower at 82.4 million per week, but the drop-off starts sooner and is more severe. A third set of figures, derived from U.S. Department of Commerce and Bureau of Labor Statistics data, shows almost a bell curve for 1940—1950. Though the three versions differ, the general trend is the same. Admissions rose from 1940 to 1946, and then dropped fairly rapidly so that by 1956 attendance was down almost 50 percent from the 1946 peak.

The decline in motion-picture admissions from 1946 to 1960 can be most productively studied in two segments. First, in the late 1940s the drop-off was largely a readjustment after some unusual wartime and postwartime conditions. During and just after World War II, people had money to spend and relatively few ways to spend it. Gasoline was rationed, many commodities were reserved for the war effort, and the movies "enjoyed a virtual monopoly of the entertainment business."¹ But with the end of wartime scarcities Americans turned to big-ticket purchases. Many bought new homes in the suburbs, which meant they were far away from the downtown movie theaters.

Television had not been a major factor in the 1940s. On 1 April 1948, only twenty commercial television stations were broadcasting in the United States. There was no television broadcasting in the southern states, and very little west of the Mississippi. Only 300,000 television sets had been sold. Fortune estimated that "90 per cent of the citizenry has not yet seen a television program."³

But television was, by all accounts, the key factor in the steady decline of American film audiences in the 1950s. By 1 January 1950 there were 98 commercial VHF television stations in the United States, by 1954 there were 233, by 1960 there were 440.⁴ In the early 1950s the Sunday editions of big-city papers were crammed with full-page ads pushing the sales of the various models of TV receivers. In 1950 more than 7.3 million TV sets were sold in the United States, and U.S. TV sales were never less than 5 million in the years 1950-1959.⁵ Poll results released by Paramount in 1950 revealed that families with television in the home decreased their film-going by 20-30 percent; Paramount assured the press that these figures were more accurate than a previous poll, which found a 46-74 percent drop.⁶ A Warner Bros. poll in 1951 found that television ownership was already responsible for a 3-4 percent drop in the overall U.S. film audience, with further declines on the way.⁷ Changes in living patterns (as in the trend toward suburbanization) and competition from other leisure activities (such as sports and travel) also affected film attendance in the 1950s.

The anti-trust case which ended vertical integration in the film industry did not directly hurt movie attendance, but it did have a profound effect on film industry stability and profitability. The case began when the government accused the eight largest Hollywood companies—Paramount, Metro-Goldwyn-Mayer (MGM), Twentieth Century-Fox, Warner Bros., RKO, Columbia, Universal, and United Artists—of monopolizing film distribution and exhibition through ownership of first-run theaters and of participating in a variety of collusive practices. Paramount, MGM, Fox, Warner, and RKO—often referred to as the "five major studios"—owned about 65 percent of the first-run theaters in the United States. In many cases, they did not compete head-to-head with one another. Instead, they offered each other favorable terms and divided up the major markets into stable configurations of first-run and subsequent-run theaters. MGM's parent company, Loew's, was very strong in New York, Paramount in Chicago, Fox on the West Coast, and so on. Columbia, Universal, and United Artists, the "three minors," did not own theater chains, but they did benefit from the nationwide cartel.⁸ Distribution and exhibition were structured so that films from the established Hollywood studios could count on a profitable release pattern, and well-connected theaters (usually first-run houses owned by the majors or by local chains) could count on a steady supply of good-quality films. However, producers outside the Hollywood system and independent exhibitors would have a difficult time breaking into the established release patterns.

The federal government won its case in the late 1940s and entered into a series of consent decrees with the eight affected studios. For the five majors, the government required the divorcement of production and distribution from exhibition; also, large stockholders would need to divest their holdings in one of the newly formed companies within two years of the divorce. The idea was that a breakup of the studios would end the cozy control of exhibition and lead to greater competition throughout the film industry. The government also required the sale of some theaters (in monopoly areas), the exhibition of a percentage of films from non-major companies, and a looser, more competitive approach to runs and exclusivities. Block booking, the licensing of films in "blocks or indivisible groups,"⁹ had been outlawed since 1946.

These changes did end a set of monopolistic practices. However, their effects on an already struggling film industry went well beyond encouraging competition. By cutting the link between production and exhibition, the consent decrees made film production a much less stable undertaking. Every film became a risk, for both producer and exhibitor. While in the past the risk had been cushioned by the activities of a large, integrated company (so that a loss in production, for example, could be compensated for by a profitable year in exhibition), after the anti-trust suit producer and exhibitor were no longer natural allies, and oversupply and undersupply became very real possibilities. Further, the FCC was skeptical about awarding television station licenses to companies found guilty of anti-trust violations. An absolute ban was not declared, but the FCC declared "a strong presumption" that monopolists would not be "qualified to operate a broadcast station in the public interest."¹⁰ This greatly limited the film industry's attempts to expand into television.

The uncertainty of foreign markets was of great concern to the Hollywood companies in the late 1940s. U.S. allies, such as Britain and France, and former enemies, such as Germany and Japan, were facing enormous rebuilding costs after World War II. American movies were popular in all of these countries, but Britain and France in particular were concerned about precious foreign exchange going to amusements rather than necessities. (Germany and Japan, as occupied nations, had less freedom of action.)¹¹ They therefore imposed a series of restrictions on the American film industry, including tariffs, blocked funds, and quota systems. International commerce was potentially a growth sector for the Hollywood industry, because television was much slower to gain a foothold abroad than in the United States. But if currency was blocked from export, then foreign earnings could not be counted on to make up for a domestic slowdown. Through intensive negotiations and some creative deal-making, the Hollywood companies had managed to free up most foreign earnings by 1950.¹² However, part of the dealmaking was to use blocked funds to produce an increasing number of films abroad, and this had the effect of decreasing jobs in Hollywood.

Yet another danger to Hollywood in the early 1950s was a set of assaults from Congress and various citizens' groups centering on patriotism and morality. The House Un-American Activities Committee (HUAC), investigating communism in the United States, had interviewed ten unfriendly witnesses from the film industry in 1947; "unfriendly" here means uncooperative and suspected of Communist activity. The Hollywood Ten refused to answer questions and were found guilty of Contempt of Congress; their appeals exhausted, all ten went to jail in 1950. In 1951, HUAC returned to Hollywood for lengthier hearings on communism in the film industry. At the same time, an industry-wide blacklist of suspected leftists meant that hundreds of people (many of them screenwriters) lost their jobs. HUAC's efforts were supplemented by the American Legion and other veterans' groups and by the state of California's Tenney Committee. Also in 1950, Senator Edwin C. Johnson of Colorado complained about Hollywood's morality and called for a Federal licensing of motion pictures.¹³

It is difficult to quantify the effect these highly publicized problems had on film industry earnings. Studio attorneys responding to civil suits brought by several of the Hollywood Ten (all of whom had been fired) were unable to prove that the release of any film had been injured by publicity about the Ten.'¹⁴ On the other hand, the 1952 U.S. release of Limelight, by actor-director Charlie Chaplin, was hurt by a pressure campaign led by the American Legion. (Chaplin had been accused of both immorality and Communist sympathies.)¹⁵ Sporadic picketing of other films in the early 1950s scared the studios, especially since the American Legion declared that local chapters could decide to picket on their own.¹⁶ However, such picketing remained small-scale and probably had a minimal effect on box-office returns. In broader terms, it is clear that the political uproar of the early 1950s—with Senator Joseph McCarthy brandishing lists of Communists in government and HUAC investigating communism in many aspects of American life—led to restrictions on subject matter in Hollywood studio films. Social issue films, concern for minorities, or criticism of big business were suspect; even sympathy for the underdog was problematic. Director Elia Kazan commented in 1952 that the studios were trying so hard not to offend that "Actors are afraid to act, writers are afraid to write, and producers are afraid to produce."¹⁷ Critic Robert Sklar (writing in 1975) concurred, saying that Hollywood in the late 1940s and the 1950s lost some of its appeal because of extreme caution.¹⁸ This new caution must have affected the box office, but it is impossible to know how much.

Hollywood's leading figures were frequently asked to comment on the industry's problems in the early 1950s, and to suggest solutions. Producer David Selznick felt that filmmakers were "struggling desperately to make ends meet," and that the audience had "drastically changed."¹⁹ Selznick's proposed solutions were, first, to rely on younger producers (since his generation might now be out of touch with the audience); and, second, to shift some production to Europe, where production costs were lower.²⁰ Director Howard Hawks suggested that Hollywood needed to make "pictures with imagination that sustain interest," because "Television is taking over the trivia."²¹ Producer Samuel Goldwyn thought that the key to future prosperity was a pay-TV technology called "phonevision," which would present Hollywood movies on home television sets.²² Paramount executives Barney Balaban and Y. Frank Freeman called for sustained efforts to cut costs, with Freeman pointing to a $50 million gap between major studio spending and income in 1949.²³

All these proposed solutions were put into practice in the 1950s. Young producers such as Stanley Kramer and the team of Harold Hecht-Burt Lancaster became important figures in the film industry. Hollywood put greater emphasis on "A" productions, and eventually on color and widescreen, to differentiate itself from television. Pictures may actually have gotten "better," as well, to meet the less loyal and more demanding audiences of the 1950s—certainly directors John Ford, Alfred Hitchcock, Billy Wilder, Elia Kazan, Fred Zinnemann, Vincente Minnelli, Gene Kelly, Stanley Donen, and Joseph Mankiewicz did some of their best work in this decade. Samuel Goldwyn's movies-at-home solution proved commercially unfeasible in the 1950s, but some accommodation with television was clearly needed. Finally, cost-cutting proceeded through the late 1940s and early 1950s. The studios cut overhead principally by saving on personnel costs. Both creative and technical staff were laid off, and those who remained were often required to take pay cuts.

The numerous challenges of the early 1950s had a powerful impact on the Hollywood film industry, but each company was affected differently. Among the major studios, for example, the consent decree presented an immediate problem for Paramount, which was required to quickly divest its theater chain, and less of a problem for MGM and its parent company Loew's, which held onto a vertically integrated company for some years. For the minor studios—principally Columbia, United Artists, and Universal—the changing conditions of the 1950s created dangers but also opportunities. The declining audience was clearly a problem for everyone. On the other hand, with the end of the vertically integrated majors, the Hollywood minors suddenly had the opportunity to compete for space in first-run theaters. Columbia and United Artists both seized this opportunity, making some of the most prestigious and successful films of the 1950s. Since the multiple changes of the early 1950s affected different studios in different ways, it is useful to discuss how each of the Hollywood majors and minors fared during this period.

Major Studios

Metro-Goldwyn-Mayer (MGM) had been for many years a high-budget, high-prestige film company. MGM was known for its lavish production values, its many stars under contract, and its mastery of the musical genre. With its East Coast parent Loew's Inc., MGM had been the dominating film company of the 1930s and had remained solidly profitable in the 1940s. The Loew's theater chain was relatively small, approximately 140 houses, but it included a number of well-placed first-run theaters. Loew's was particularly strong in New York City. The leaders of the company were Nicholas Schenck, president of Loew's, and Louis B. Mayer, studio head of MGM. Schenck had been with Loew's since 1907 and had served as president since the death of founder Marcus Loew in 1927. Mayer had been running the studio since it began (as a merger between three smaller production companies) in 1924.

Though MGM appeared to be a profitable and stable company, its top-heavy management structure interfered with adjustments to the new economic conditions of the late 1940s and early 1950s. Mayer's official position was vice president in charge of production. Under him were several other vice presidents and more than forty producers. Decisions were made, very cautiously, by committee. Thomas Schatz notes that Irving Thalberg, MGM's legendary production executive who died in 1936, had turned out forty-five films in 1927 with six supervisors; twenty years later MGM was making slightly fewer pictures with an enormous increase in high-level managers.²⁴ The executives at MGM and Loew's were older men who had been in their jobs a long time. For example, vice presidents Eddie Mannix and Benny Thau had been with MGM since the mid-1920s. Arthur Freed, producer of MGM's most prestigious musicals, had started in show business as a writer of song lyrics, but his association with MGM went back to 1927 (the beginning of sound film). He had been an MGM producer since 1939. Not surprisingly, managers with such long tenure were resistant to change. Lillian Ross in her book Picture presents the executives of MGM and Loew's as aging "yes men," following the lead of their respective chiefs Mayer and Schenck.²⁵

Nicholas Schenck, in an attempt to revitalize the company, had in 1948 asked Mayer to find an executive to take charge of all of MGM's productions. Mayer eventually recommended Dore Schary, at age 43 already a distinguished writer, producer, and executive. Schary had been a supervisor of "B" pictures at MGM in the early 1940s. He produced I'll Be Seeing You for David Selznick in 1944, and then moved to RKO as head of production. At RKO he supervised such films as The Spiral Staircase (1946), Crossfire (1947), and They Live by Night (1949). Schary's liberal politics posed a potential conflict with the "archconservatism" of Mayer and Schenck,²⁶ but Schary had already shown a willingness to cooperate with the prevailing anticommunism. He promised to bring a more contemporary sensibility to MGM without unduly affecting the studio's traditions. Schary joined MGM as vice president in charge of production on 1 July 1948. Mayer's official title became vice president in charge of the studio.

In practice, Schary's ability to change MGM's output was fairly limited. Nicholas Schenck strongly backed Schary, but MGM's veteran staffers were fiercely loyal to Mayer. Arthur Freed, for example, reported only to Mayer, even though Schary was in theory his boss.²⁷ The power struggle was resolved only in June 1951, when Mayer retired from MGM under pressure from Schenck. Even at this point, though, the MGM studio had a momentum of its own that Schary could only gradually change. With its roster of stars, its high-quality but expensive departments, and its veteran producers, MGM was committed to a certain type of production. Schary could have drastically cut staff and relied on independent producers in the early 1950s—if the Loew's board of directors would have gone along. MGM did not follow that path. Instead, it kept to a program of expensive, in-house productions. Musical productions, for example, though far more expensive than the average film, remained about 25 percent of the studio's output. This was necessary to justify and maintain MGM's large number of musical specialists—producers, arrangers, supervisors, singers, and dancers, to name a few.²⁸

MGM's financial situation can be analyzed in unusual detail thanks to a large bound book known as the "Eddie Mannix Ledger," which was found in the papers of MGM head of publicity Howard Strickling.²⁹ Eddie Mannix was the general manager and one of the administrative vice presidents for MGM. His ledger gives basic financial data for every film distributed by MGM between 1924 and 1962, including production cost, overhead days, domestic earnings, foreign earnings, and profit or loss. Interestingly, total earnings minus production costs do not equal profit or loss in Mannix's accounting; profit is always much smaller than this simple equation might suggest. The explanation seems to be that distribution and publicity costs are subtracted from earnings, though there is no column for such costs.³⁰ There are other unknowns about the ledger as well: how data was compiled and how the document was used. Nevertheless, even if Mannix's data is more trustworthy in the comparative than in the absolute sense, the ledger still gives us a wealth of information on specific films, specific years, and multiyear trends.

The data in table 2 reveal that MGM's output increased slightly between 1949-1950 and 1952-1953. This is consistent with the rest of the film industry, and it suggests that film production did not immediately adjust to the decline in audiences. The number of films distributed by the majors and minors actually peaked in 1951, before declining sharply in 1954. Although this seems like an odd response to an industry-wide crisis, Michael Conant comments that the studios were under pressure from exhibitors to raise the total number of films in distribution in the years around 1950. Conant's explanation is that with declining audiences, theaters needed to change their programs more often. After the divorcement required by the consent decree, producer/distributors would have had less incentive to help exhibitors in this way.³² The rise in production may also have been an attempt to exploit the industry's instability by taking theater bookings from competitors. MGM had an additional reason to keep production levels high, for this studio was not facing the imminent loss of its theater chain. Loew's theaters remained profitable well into the 1950s, and Loew's and MGM did not split until 1954 (ownership was not completely divested until 1959!).³³ So the "business as usual" of the MGM studio was matched by a continuation of a vertically integrated Loew's, Inc.

MGM's cost per film was high, but not out of line with the costs of its competitors. Using the Eddie Mannix Ledger's figures, the average production cost per film can be calculated as $1,413,000 in 1949-1950, $1,310,000 in 1950-1951, $1,525,000 in 1951-1952, $1,307,000 in 1952-1953, and $1,511,000 in 1953-1954. By comparison, Paramount's production cost per film was $1,428,000 in 1949, and Fox's was a very high $1,787,700.³⁴ In a period of marginal profits, the control of spending could be crucial to determining success or failure in a particular year. For example, the difference between MGM's balance sheets for 1949–1950 and 1950–1951 is not a matter of gross earnings—they are almost identical. But profits doubled in 1950—1951 because of a 7 percent reduction in costs. In 1953-1954, MGM went in a different direction—reducing output but not the average cost per film. This was at least modestly successful, because yearly production costs dropped 24 percent and earnings dropped only 12 percent.

The Mannix Ledger suggests that foreign earnings had become more and more important to MGM's operation. Domestic earnings, under pressure from television and other factors, declined slightly from 1949-1950 to 1952-1953. Foreign earnings increased substantially in the same period, from $30.58 million to $44.72 million. Note that in Europe, only England had an extensive television industry in the early 1950s. In France, Italy, Germany, and Spain television was still in its infancy, and therefore motion pictures remained the leading form of mass media entertainment. However, the dramatic increase in foreign earnings may be misleading because the totals include blocked funds. Many countries that imported American movies restricted the export of a percentage of the profits to the United States. These funds needed to be spent within the country in which they were generated. Given such restrictions, it is very difficult to know how much of MGM's foreign earnings were immediately available to MGM/Loew's in the United States.

One surprise revealed in the individual film entries of the Eddie Mannix roster is that musical films are not the studios most profitable productions in the early 1950s. An American in Paris (1951), winner of several Academy Awards, cost $2,754,000 (about twice the cost of an average MGM feature) and earned an estimated profit of $1,361,000. By contrast, the Spencer Tracy-Elizabeth Taylor comedy Father of the Bride (1950) cost $1,215,000 and had an estimated profit of almost $3 million. MGM's most expensive film of the period, Quo Vadis? (1951) also did extremely well. The cost was $7,623,000, earnings were an estimated $21.2 million (with foreign earnings almost 50 percent of this total), and profit was estimated at $5,562,000. As for other celebrated musicals of the period, Singin' in the Rain (1952) cost $2,593,000 and had eked out an estimated profit of $693,000 by 1957. The Band Wagon (1953) cost $2,873,000 and took an estimated loss of $1,147,000. Brigadoon (1954), It's Always Fair Weather (1955), and Silk Stockings (1957) all lost more than $1,300,000, and Invitation to the Dance (started production 1952, released 1957) was an almost complete write-off, with a cost of $2,822,000 and a loss of $2,523,000. These figures certainly explain MGM's greatly curtailed production of musicals in the late 1950s.³⁵

Famous as the studio of the stars, MGM had numerous high-profile stars in its films of the late 1940s and early 1950s. The list includes Spencer Tracy, Clark Gable, Robert Taylor, Robert Young, Gene Kelly, Van Johnson, and Red Skelton among the men, plus female stars Katharine Hepburn, Esther Williams, Lana Turner, Myrna Loy, Jane Powell, Elizabeth Taylor, June Allyson, Debbie Reynolds, and Cyd Charisse. Most of these were under long-term contracts, and MGM was slower than some of the other studios (e.g., Paramount, Warner Bros., Columbia) to move to short-term deals with top stars. Judy Garland, a popular MGM star of the 1940s, was released by the studio in 1950 after a history of illness and substance abuse.

Producers at MGM included Arthur Freed, Joe Pasternak, Jack Cummings, Sam Zimbalist, Pandro Berman, and John Houseman. Among the directors were Richard Brooks, Clarence Brown, George Cukor, Mervyn Le Roy, Vincente Minnelli, Gene Kelly, Stanley Donen (first as co-director with Kelly, eventually going off on his own), John Sturges, Charles Walters, and William Wellman. This was a strong and veteran group of filmmakers.

The challenge to any film company in the 1940s and 1950s was to adjust and keep adjusting to rapidly changing conditions. Paramount, Twentieth Century-Fox, and Warner Bros. all managed the adjustments fairly well. Paramount Pictures was, by the mid-1940s, the largest and most profitable of the major studios. Its theater chain of about 1,400 houses was the largest in the United States, and it also had a strong position in Canada. However, Paramount split into two separate companies in 1950, following the terms of the consent decree. The theater chain became United Paramount Theatres (which later merged with the ABC Radio and TV network), and the production/distribution branch Paramount Pictures was on its own. Paramount Pictures kept the Canadian and overseas theaters (318 in all), which were not affected by the consent decree. Paramount also had a minority interest in the Dumont television company (equipment manufacturer and broadcasting network) and owned a television station in Los Angeles.

Paramount Pictures' top managers were President Barney Balaban in New York and studio head Y. Frank Freeman in Los Angeles. Freeman's background was in film exhibition (as was Balaban's), but he had been managing Paramount's West Coast operations since 1938. Under Balaban and Freeman, Paramount had emphasized "A" pictures and long runs in the 1940s and had made excellent profits—$39.2 million in 1945 and $28.2 million in 1946. This was by far the best showing of any Hollywood studio. However, it should be remembered that Paramount had the largest theater chain, so in boom years it would do particularly well. In the late 1940s, as the overall film audience declined, Paramount cut its average cost per film from $1,512,000 (1946) to $1,144,000 (1950).³⁶ The "new" Paramount production and distribution company averaged profits of about $6 million between 1950 and 1953, but of course the company itself was much smaller than in the 1940s.

Paramount had a strong group of stars and a number of capable filmmakers under contract. The two biggest stars were Bing Crosby and Bob Hope, both of whom were ranked in the top ten list of Hollywood stars for eleven consecutive years, 1943 to 1953.³⁷ Other Paramount stars circa 1950 were Alan Ladd, William Holden, Betty Hutton, Jerry Lewis, Dean Martin, Dorothy Lamour, and Charlton Heston. Even more impressive were the producers and directors associated with Paramount. Cecil B. DeMille, a producer and director, was the most successful filmmaker (in box-office terms) in the film industry. DeMille, born in 1881, had helped to found Paramount's West Coast studio in 1913 and had worked with Paramount for most of his career. In his later years he was still producing a series of high-grossing epics—Samson and Delilah (1949), The Greatest Show on Earth (1952), and The Ten Commandments (1956). DeMille's films were so important to the studio that he was charged a lower overhead than anyone else.³⁸ Hal Wallis, another industry veteran, moved from Warner Bros. to Paramount in the mid-1940s. Wallis produced 3 to 4 pictures per year at Paramount as an independent producer who received a percentage of the profits for the films he made. Wallis also prided himself on finding new talent—two of his coups were multi-film contracts with Burt Lancaster and Elvis Presley. Other high-quality filmmakers at Paramount were Leo McCarey, George Seaton, George Stevens, Billy Wilder, and William Wyler.

Twentieth Century-Fox, like its competitors, had prospered during World War II and the immediate postwar period. Taking advantage of the long theatrical runs characteristic of the period, Fox made fewer but more expensive films in the 1940s. Fox's average cost per film in 1947 was an astoundingly high $2,328,600. The strategy paid off with profits of $22.6 million in 1946 and $14 million in 1947. As audiences dropped in the late 1940s, Fox reduced its average cost per feature, and thus maintained profitability. Only in 1951 and 1952 did profits fall dramatically ($4.3 million in 1951, $3.7 million in 1952).

Fox's top management consisted of Spyros Skouras in New York and Darryl Zanuck in Hollywood. Skouros, basically a film exhibition man, had been organizing and managing theater chains since the 1920s. Skouras responded to film's declining audience circa 1950 by looking for technological, exhibition-based solutions. He first turned to theater TV, touting a system known as Eidophor. When that generated little enthusiasm, he bought a widescreen process based on anamorphic lenses and called it "CinemaScope." Beginning with the blockbuster 1953 release The Robe, CinemaScope became the most successful technological innovation of the 1950s. When the production/distribution end of Fox split from the theater chain in September 1952, Spyros Skouras stayed with the production company while his brother Charles (also a veteran theater man) headed the theater chain. This led to claims from independent exhibitors that the two companies were still setting common policy and that the intent of the consent decree was not being met.³⁹

Unlike Y. Frank Freeman at Paramount, who was basically a manager, Darryl Zanuck at Fox was a hands-on creative producer. Zanuck had been a writer, producer, and production executive at Warner Bros. from 1926 to 1933. He left Warners to found an independent company, Twentieth Century Productions, with partner Joseph Schenck. In 1935 Zanuck and Schenck merged Twentieth Century with Fox, and Zanuck became the new company's West Coast studio head—a position he held until 1956. Zanuck personally produced a few films each year at Fox, and he made creative contributions to many more. In the late 1940s, Fox under Zanuck produced and distributed several prize-winning films on controversial issues, including Gentleman's Agreement (1947), The Snake Pit (1948), and Pinky (1949). Zanuck also supported a switch to shooting crime films on location, taking advantage of the audience's new postwar familiarity with documentary immediacy. But Fox in the late 1940s also made many conventional entertainment films, including a series of Technicolor musicals starring Betty Grable.

Zanuck noted in the early 1950s that audiences seemed to be interested in escapist entertainment, and he turned Fox's production schedule toward musicals, comedies, and adventure stories.⁴⁰ Two of the biggest Fox stars, Gregory Peck and Susan Hayward, were teamed successfully in the Biblical story David and Bathsheba (1951). Other stars of 1950–1952 were Richard Widmark, Victor Mature, Anne Baxter, Gene Tierney, Clifton Webb, Jean Peters, Dan Dailey, Dana Andrews, and Jeanne Crain. Among the top filmmakers working for Fox from 1949 into the early 1950s were Joseph Mankiewicz, Howard Hawks, Elia Kazan, Jules Dassin, writer-producer Nunnally Johnson, Otto Preminger, and Robert Wise. Fox's most important new star of the period was Marilyn Monroe, but the studio did not immediately understand her box-office power. For example, in How to Marry a Millionaire (1953), Monroe receives third billing, behind Lauren Bacall and Betty Grable.

Warner Bros. in 1950 was a publicly owned but family-managed company. Harry Warner, the oldest brother, was president of the company, based in New York. Albert Warner, the treasurer of Warner Bros., was also in New York. Jack Warner was vice president in charge of production, and therefore the top executive at Warner Bros.' Burbank studio. (A fourth brother, Sam Warner, had died in 1926.) This management team had been in place since the 1920s. Like its competitors, Warners had stunningly profitable years in 1946 and 1947. Unlike Paramount, MGM, and Fox, Warner Bros.' biggest year was 1947, with a profit of $22 million. The company's profits then gradually declined to $11.8 million in 1948 and an average of about $10 million between 1949 and 1951. The divorce of the theater chain (which became Stanley Warner Theatres) took place on 28 February 1953. After divorcement, Warner Bros.' profits were only $2.9 million in 1953.

Jack Warner, always a budget-conscious executive, responded to the less favorable conditions of the late 1940s and early 1950s by slashing costs. Many of the Warner stars were released from their long-term contracts—the list includes James Cagney, Humphrey Bogart, Bette Davis, Barbara Stanwyck, Olivia de Havilland, and George Raft. Only a few Warner stars—notably Errol Flynn and Ronald Reagan—were kept on into the early 1950s. In 1951, department heads were laid off, the publicity staff was reduced, and the story department was closed.⁴¹ Prolific producer Jerry Wald left for RKO (which paid $150,000 for his contract). Henry Blanke, another top Warners producer, endured several salary cuts, and even Jack Warner's assistant Steve Trilling was eventually dismissed. Thomas Schatz notes that the various cuts sustained Warners' profits at the highest level in the industry in 1950 and 1951, but "the potential for future profits was diminished considerably."⁴² However, one could also suggest that Jack Warner was quickly moving the company toward a future of distributing independent productions. Distribution agreements were made with producer/director Alfred Hitchcock, and with producer/stars such as James Cagney (the former Warners contract star) and Burt Lancaster.

Warner Bros. had been known for its noir films in the 1940s, many of them starring Humphrey Bogart, Edward G. Robinson, and/or John Garfield. In the early 1950s, Warners (like Fox) switched its emphasis to musicals, comedies, and adventure films. Doris Day quickly became the studio's biggest star, appearing in a series of musicals including Tea for Two (1950), Lullaby of Broadway (1951), On Moonlight Bay (1951), and Calamity Jane (1953). Gordon MacRae appeared opposite Day in many of these films. Another star of Warner musicals in the early 1950s was Virginia Mayo. Warners also made short-term agreements with some of Hollywood's top talents: Gary Cooper, John Wayne, Jane Wyman, Gregory Peck, Patricia Neal, and Randolph Scott. Warner Bros. was the first major studio to invest in 3-D production, and scored a big success with the 3-D horror film House of Wax (1953). Warners also worked with such prestigious directors as Hitchcock, Elia Kazan (A Streetcar Named Desire, 1951), and Michael Curtiz (who had been a Warners contract director since the 1930s).

RKO was the weakest and most erratic of the five major studios. The RKO theater chain was relatively small (124 theaters) but it was well situated with first-run houses in New York, New Jersey, and Ohio. However, the production end of the business had struggled through several different managements in the 1930s and 1940s, with consistent profitability only in the boom years of 1943—1946. In 1947—1948 RKO was trying to build up in-house production under controlling owner Floyd Odlum, president Peter Rathvon, and studio head Dore Schary. Schary was particularly proud of the young directors he had under contract, including Edward Dmytryk, Nicholas Ray, Joseph Losey, and Mark Robson.⁴³ At this point Odlum, who viewed RKO as an investment rather than a vocation, sold his interest in RKO to one of the strangest figures in twentieth-century American history: Howard Hughes.

The fabulously wealthy Hughes already controlled three enormous corporations: Hughes Tool Company (oil-drilling equipment), Hughes Aircraft (a defense contractor), and Trans-World Airlines. He had worked intermittently in Hollywood as an independent producer, with credits including Hell's Angels (1930), Scarface (1932), and The Outlaw (1943). His films had been expensive and controversial, often flouting conventional morality, but some of them had been successful as well.

Hughes promised Rathvon and Schary that he would be a hands-off owner, giving studio management more freedom than they had under Odlum. He broke this promise in about a month, ordering Schary to fire Barbara Bel Geddes from the cast of Bed of Roses and to take Battleground (one of Schary's favored projects) off the RKO production schedule. Schary resigned on 30 June 1948; he eventually bought Battleground for his next employer, MGM (it was a big hit in 1949). Rathvon soon resigned as well. Management of the studio was given to a three-man executive committee including veteran producer Sid Rogell. In the summer of 1948, Hughes fired several hundred RKO employees, and he canceled work on four expensive pictures.⁴⁴ One of these was The Robe, a novel set in New Testament times that would become one of the biggest hits of the 1950s.

Howard Hughes tried to personally manage RKO, paying obsessive attention to certain films. However, Hughes was not an experienced motion-picture executive and he had other business interests. He therefore neglected long-range planning while attempting to be both owner and creative producer. Hughes did agree in 1949 to divest RKO's theater chain from the production business—the studio became the first to go along with the government's remedy in the Paramount case. But Hughes held onto the production side of RKO for several more years, even though no one was really running the business. Hughes almost never set foot on the RKO lot,⁴⁵ yet he insisted on approving story properties, casting, agreements with producers, and other things that could have been delegated. Often decisions were delayed, and therefore RKO could not compete with the other studios for talent and properties. Hughes did ask at least a few of the top Hollywood producers and executives to come to work at RKO (Hal Wallis declined),⁴⁶ and in 1950 he succeeded in bringing producer Jerry Wald and his partner, writer Norman Krasna, to RKO as independent producers. The Wald-Krasna team was supposed to make twelve films per year for RKO over a five-year period, which would be a huge help in generating product for the studio's distribution system. However, Hughes retained approval over stories and casting, and Wald-Krasna struggled to get anything approved in 1951. Wald and Krasna left RKO in 1952, having produced only four pictures (two complete, two in process).

RKO was involved in a long series of scandals during the Hughes years. Hughes was often in court, sometimes with RKO stockholders. Among the scandals were: 1) an attempt to exploit Ingrid Bergman's affair with Roberto Rossellini, and the birth of their illegitimate child, in the ad campaign for Stromboli (1950); 2) the favorable deals Howard Hughes as an individual made with RKO, the corporation, for films Hughes had produced or was producing; 3) a dispute with producer Jack Skirball, who had negotiated a deal with RKO for a big-budget film with Gregory Peck (Hughes maintained there was no deal; Skirball won in court); 4) the denial of screen credit to blacklisted screenwriter Paul Jarrico for The Las Vegas Story (1952), which caused a dispute with the Screen Writers Guild and eventually a civil suit.

In September 1952 Hughes found a buyer—actually a syndicate of buyers—for his scandal-ridden studio, but this touched off the biggest scandal of all. The Wall StreetJournal revealed, in a series of articles starting 16 October 1952, that some of the buyers had histories of mail order fraud, high-stakes gambling, and association with organized crime.⁴⁷ Because of this unwanted publicity, the buyers backed out of the deal, forfeiting their down payment. Hughes was back in control of RKO.

During these crisis years, RKO production slowed but did not stop. According to Fortune, RKO's in-house production decreased from twenty-eight films in 1947 to ten in 1952.⁴⁸ The quality of RKO's films was sometimes good. Directors Fritz Lang and Nicholas Ray stayed with the studio well into the 1950s, as did actors Robert Mitchum, Robert Ryan, and Jane Russell (Russell's contract was originally with Hughes, not RKO). But there simply were not enough films to justify the overhead of running a major studio. RKO's distribution network limped along thanks largely to contracts with independent producers, including Samuel Goldwyn and Walt Disney.

As might be imagined, the mismanagement of RKO led to consistent financial losses and to the destruction of the studio's reputation. Losses on the production side totaled more than $20 million between 1948 and 1953.⁴⁹ It is possible that RKO would not have flourished under any management in the film industry downturn of the 1950s. However, since all the other leading studios managed to stay afloat through the decade, the decline and fall of RKO must be blamed first and foremost on Howard Hughes.

Minor Studios

Columbia and Universal were considered minor studios because their production and distribution businesses were not complemented by ownership of a theater chain. Without the muscle of their own theaters, Columbia and Universal did not in general try to rival the star power and high production values of the five major studios. Both of these companies specialized in "B" movies or "programmers" through the mid-1940s; in Tino Balio's words, they "were useful to the majors in supplying low-cost pictures to facilitate frequent program changes and double features."⁵⁰ Columbia did produce a few high-budget, high-prestige films in the 1930s, notably the comedies of Frank Capra. When "A" movies became predictably successful at the end of World War II, both studios raised the budgets of some films, while continuing to make less expensive Westerns, series (e.g., Universal's Francis the Talking Mule films), and serials. Columbia benefited from having Rita Hayworth under contract—she was one of the top stars and sex symbols of the 1940s. Universal had no star with this kind of drawing power until Rock Hudson hit his stride in the mid-1950s.

Columbia was founded by the Cohn brothers, Harry and Jack, but this was not an equal partnership. Harry, based in Los Angeles, was after 1932 both president and head of production for the studio, while Jack, based in New York, was executive vice president. Harry Cohn was a legendary Hollywood figure, crude, petty, penny-pinching. Producer Stanley Kramer, who had a multi-picture deal at Columbia between 1952 and 1954, describes Cohn as "vulgar, domineering, semi-literate, ruthless, boorish and some might say malevolent."⁵¹ He was also a shrewd Hollywood executive with a good "eye for commercial prospects," as Kramer admits.⁵² Harry Cohn supervised the entire Columbia studio as well as occasionally serving as de facto producer on a film.

In the early 1950s, Cohn's strategies were to raise output and to challenge the dominance of the majors with a number of high-prestige films. Columbia led the film industry with fifty-nine releases in 1950 and sixty-three in 1951, though the cost-per-picture would not have compared to MGM, Paramount, Fox, or Warner Bros. Columbia was still making Westerns and other low-budget genre films (as well as Three Stooges shorts), but was mixing in a surprising number of top-quality films. Many of the "A" pictures were independent productions from Stanley Kramer Productions (Death of a Salesman, 1951; The Member of the Wedding, 1952; The Caine Mutiny, 1954). Columbia was also making excellent films in-house, for example the George Cukor-directed Born Yesterday (1950), and the Academy Award-winning From Here to Eternity (1953). Harry Cohn believed in short-term contracts, so it is difficult to compile a list of Columbia stars in the early 1950s. Judy Holliday, Rita Hayworth, and Broderick Crawford were clearly associated with Columbia. Humphrey Bogart and Randolph Scott worked at Columbia among other studios. Burt Lancaster, Glenn Ford, Gloria Grahame, Gale Storm, William Holden, Kirk Douglas, Donna Reed, Lucille Ball, Charles Boyer, Loretta Young, Robert Cummings, Mel Ferrer, and Anthony Quinn all made at least one Columbia film.

Universal Pictures' production output in the late 1940s was a strange amalgam of low-budget series (Ma and Pa Kettle, Abbott and Costello), crime films (The Killers, 1946; The Naked City, 1948), Technicolor exoticism (Night in Paradise, 1946; Bag Dad, 1949), and adaptations of leading playwrights (Another Part of the Forest and All My Sons, both 1948), plus musicals, comedies, and Westerns. Production heads William Goetz (Louis B. Mayer's son-in-law) and Leo Spitz had raised production budgets to compete with the majors, but their prestige pictures lost money and so they had to cut back on overall spending.⁵³ In 1952, Decca Records bought a controlling interest in Universal, and Milton Rackmil became president of both Decca and Universal. Goetz and Spitz were replaced by Edward Muhl, who had previously been studio manager. The Decca-Universal combination was an early example of media conglomeration. Decca had been releasing records featuring Universal stars and Universal properties for more than a decade, but these arrangements were based on individual deals, not a blanket contract.⁵⁴ In the early 1950s, Decca's taking control of Universal suggested that further links were likely. Milton Rackmil told the press that certain functions of the two companies might be combined and that a joint approach to producing for television was possible.⁵⁵

Under Muhl and Rackmil, Universal added glossy entertainments, often in Technicolor, to its genre movies and serials. These included exotic, Arabian Nights-type stories (Flame of Araby, 1951), conventional melodramas (All I Desire, 1953), and Technicolor Westerns (The Redhead from Wyoming, 1953, starring Maureen O'Hara). Universal had directors Anthony Mann, Budd Boetticher, Raoul Walsh, and Donald Siegel making Westerns in the early 1950s—an impressive lineup. Anthony Mann's black and white Winchester '73 (1950) was noteworthy because star James Stewart was given 50 percent of the profits. This approach, designed by Stewart's agent Lew Wasserman, could be used to lure top talent away from the major studios. Winchester '73 was a hit, according to writer Dennis McDougal, and "Stewart eventually earned more than $600,000 from a movie it cost Universal $917,374 to make."⁵⁶ Universal stars of the period included Stewart, Rock Hudson, Tony Curtis, Yvonne De Carlo, Maureen O'Hara, Donald O'Connor, and Piper Laurie.

United Artists, the smallest of the "little three," was founded in 1919 to distribute the films of its owners Mary Pickford, Douglas Fairbanks, Charlie Chaplin, and D. W. Griffith. Thirty years later, Pickford and Chaplin were still the owners, but the studio was in desperate trouble. Pickford had retired from the movies, Chaplin was producing one film every four or five years, and United Artists was having difficulty attracting independent producers to its distribution setup. A number of studios were trying to sign independent producers around 1950, and United Artists was hindered by a lack of funding and an inefficient management scheme. UA President Grad Sears had to get approval from owners Pickford and Chaplin on proposed deals, whereas executives at other companies had much more freedom of action.⁵⁷ United Artists, like RKO, had too few films for its distribution pipeline, and therefore UA was losing $100,000 a week by 1951.⁵⁸

United Artists was saved from bankruptcy and/or dissolution via an unusual offer from Arthur Krim and Robert Benjamin, both successful New York lawyers with considerable film industry experience. Krim and Benjamin offered to take over operation of United Artists for ten years "on the condition that if UA earned a profit in any one of the first three years, the Krim-Benjamin team would be allowed to purchase a 50 percent interest in the company for a nominal one dollar a share."⁵⁹ This arrangement was accepted in February 1951. The "new" United Artists took over the film inventory of Eagle-Lion Pictures (Krim and Benjamin had worked for this short-lived company in the late 1940s) to get distribution moving again. It then made distribution agreements with Horizon Pictures for The African Queen (1951) and with Stanley Kramer Productions for High Noon (1952); both turned out to be major hits. United Artists was modestly profitable in 1951, so the terms of the Krim-Benjamin agreement with Pick-ford and Chaplin went into effect almost immediately. Krim and Benjamin then built on their early success to design a new strategy for independent production (which will be discussed later in this chapter).

A step down from Universal, Columbia, and United Artists were the "Poverty Row" studios, principally Monogram and Republic. These production-distribution companies provided extremely inexpensive genre films (primarily Westerns) to fill out the programs of smaller theaters. They were badly squeezed in the late 1940s and early 1950s by the downturn in film receipts and the closing of many theaters. Television became a factor in the 1950s, because set owners could now stay home and watch formula entertainment. Republic experimented with a few "A" productions, including John Ford Westerns (Fort Apache, 1948; Rio Grande, 1950) and Nicholas Ray's Johnny Guitar (1954). Monogram changed its name to Allied Artists in 1953 and concentrated on medium-budget production.

Independent Production

"Independent production" is a much-used but rarely defined phrase in the American film industry. In historical context, the phrase refers to a move away from a factory-like system where all aspects of a production are handled by studio employees, and toward a flexible, free-lance system where the personnel and other elements of a production are assembled for each individual film. Janet Staiger describes independent production as a "package-unit system," meaning that the key unit of organization is the individual film rather than the studio's yearly production schedule.⁶⁰ We must add a caveat here, because the film studio remained an important economic presence even after the increase in independent production of the 1950s. Studios no longer control every aspect of a film's production, but they do generally provide the crucial elements of financing and distribution. Also, to protect their investments, studios have generally retained some oversight of the production process itself—for example, cost and schedule guarantees and right of final cut—as well as control of advertising and distribution.

Though Hollywood in the 1930s and 1940s was dominated by the big studios, a few producers such as Samuel Goldwyn, David Selznick, and Walter Wanger chose to make their films independently, negotiating distribution contracts with the major or minor studios. Goldwyn, Selznick, and Wanger had stars and directors under contract and owned high-prestige story properties, all of which enhanced their negotiations with the studios. Selznick, for example, bought the rights to the enormously popular novel, Gone with the Wind, a property any of the studios would have been delighted to own. However, because Selznick wanted Clark Gable in the leading role of Rhett Butler, he made a distribution deal with MGM, offering the studio a substantial chunk of the profits. Independent production was never entirely independent; it was always a negotiation.

In the early to mid-1940s, producers, directors, and a few stars formed their own production companies to make films for studio distribution. The list includes Alfred Hitchcock Productions; Liberty Films (Frank Capra, William Wyler, and George Stevens); International Pictures (Gary Cooper); Argosy Productions (John Ford and Merian C. Cooper); and Cagney Productions (James and Bill Cagney). There were three basic reasons for creative people to form a production company instead of working on a studio contract: 1) Independent producers were entitled to a share of a film's profits, and therefore could make huge sums from a major success; 2) Personal income taxes were very high, and corporate taxes were much lower, so film people derived immediate benefits from "becoming a corporation"; 3) Some creative people were tired of studio bureaucracies and wanted to guide their own careers.

During the boom years of the mid-1940s, banks provided easy credit to independent producers on the theory that "a feature film—any feature film—would always return at least 60 percent of its negative costs at the box office."⁶¹ Major banks such as Bank of America, Security First National Bank, and Guaranty Trust were therefore willing to advance up to 60 percent of negative cost with the film-in-process as its own collateral. Other loans and salary deferments provided the remaining 40 percent of funding. This liberal approach to credit naturally stimulated the growth of independent production. Janet Wasko notes that there were forty independent companies producing features in 1945, and 100 (including the major studios) in 1947.⁶²

With the downturn in film industry receipts starting in 1947, the "60 percent rule" proved to be unduly optimistic. Numerous films were not making back even the 60 percent of the primary bank loan. Even the independent efforts of important filmmakers like Frank Capra (It's A Wonderful Life, 1946) and Preston Sturges (Mad Wednesday, 1947) were box-office flops. Major banks had to foreclose on motion-picture loans and to laboriously try to regain their investments through foreign distribution and other strategies. At this point the banks cut back on financing individual pictures, preferring to loan money to larger corporations with tangible assets—the major distribution companies.⁶³ Instead of negotiating directly with a bank, an independent producer now needed a distribution agreement, a completion guarantee, and perhaps a loan guarantee from a leading distributor. So, paradoxically, independent production became more and more dependent on the judgment and oversight of the major and minor Hollywood studios.⁶⁴

Independent productions did not dimmish or disappear with the new restrictions on bank lending, mainly because they suited the needs of the studios. With audiences declining and the consent decrees adding considerable uncertainty to the film business, the studios had an immediate need to cut overhead. By sponsoring independent production, they could eliminate the need for large permanent staffs. A studio could be reduced to management, accounting, sales, advertising, and publicity departments, plus a skeleton crew to maintain the physical facilities. In practice, this happened gradually, over a period of years or even decades. The process of cutting permanent staff can be highlighted by some estimates from The Film Daily Yearbook. In 1945 the major studios had 804 actors under contract, in 1950 the number had decreased to 474, and in 1955 to 209. As for writers, there were 490 under contract at the major studios in 1945, 147 in 1950, and only 67 in 1955.⁶⁵ In this same period, the members of craft unions were also moving from year-round contracts to free-lance work, but with far less publicity.

For creative people, the new working conditions were a mixed blessing. Those most in demand could now require princely salaries plus a percentage of the profits. And by forming their own production companies, actors, directors, and other filmmakers could be taxed at the 52 percent maximum for corporations instead of the confiscatory 75 to 92 percent for personal incomes over $100,000.⁶⁶ A number of actors, including Humphrey Bogart, Ida Lupino, Burt Lancaster, and Danny Kaye, formed production companies around 1950. However, profit participation meant nothing if a film was not successful, and those stars who invested in their own projects could actually take a loss. For marginally employed actors and other creative types the end of a studio contract meant uncertainty, likely periods of unemployment, and possibly the search for a new career. Membership in the Screen Actors Guild dropped 19 percent between 1947 and 1951 (it was later to rebound, because of Los Angeles—based television production).⁶⁷ The New York Times put this statistic into human terms in a profile of character actor Gino Corrado. Corrado, who had specialized in waiter and headwaiter roles (his credits include Top Hat, 1935; Gone with the Wind, 1939; and Casablanca, 1942) was by 1949 out of show business and working as a real-life headwaiter at a restaurant in Beverly Hills.⁶⁸

The trend toward independent production accelerated in 1950 and 1951. Variety reported in early 1950 that much of the support for independent production was coming from the smaller, more marginal studios. RKO, Columbia, Republic, Monogram, and the small distributors Eagle Lion and Film Classics were all offering financial assistance to in-demand producers.⁶⁹ In some cases prestigious producers went to minor studios because of favorable financing as well as the autonomy and profit participation of indie production. For example, Louis de Rochemont signed with Columbia, and John Ford and Merian C. Cooper reached agreement with the Poverty Row studio Republic. Later in 1950 Paramount was actively recruiting independent producers and was changing to an emphasis on "semi-autonomous production units" rather than "salaried house producers."⁷⁰ RKO and Warner Bros. were moving in the same direction, with only MGM and Twentieth Century-Fox among the majors sticking to in-house production. By February 1951, Columbia was assembling a high-profile group of independent producers, Warners was working with Cagney Productions and Milton Sperling, and Fox had a three-picture deal with Joseph Bernhard.⁷¹

The films made as the studio system gradually dissolved should probably be called "semi-independent productions." The studio did far more than rent space to production companies. It arranged financing, approved story and budget, monitored production, and controlled marketing and distribution. Also, since studios in the early 1950s retained many of their contract personnel and technical departments, independent producers were encouraged (and in some cases required) to use studio crews and facilities. Independent production was really a partnership between producers and studios, with much depending on contract provisions and working relationships between the principals. Everything was open to negotiation, so that even regular studio contracts for top talent began to include profit participation and the ability to do outside films.

United Artists, traditionally the distributor of Hollywood's handful of top independent producers, had not prospered when the other studios began competing for this same talent. However, after the fortunate successes of The African Queen and High Noon, the new management team of Arthur Krim and Robert Benjamin moved UA in a radically new direction. UA had no studio facilities or contract personnel to support, and therefore could provide more autonomy to the creative producer. Krim and Benjamin realized that the key element determining success in the "new Hollywood" of 1950 was the relationship between distributor and producer. By carefully choosing successful and reliable independent producers and establishing long-term relationships with them, United Artists could compete for talent with the biggest major studios. Further, United Artists was willing to forgo the day-to-day monitoring of production that had been standard in the studio system and had been taken over by the banks and then by studios sponsoring semi-independent production. For experienced producers, United Artists was willing to make a deal based on story, budget approval, and a completion guarantee. The producer was then free to organize and shoot the film on his own (female producers were at this time very rare), turning over the finished product to United Artists for distribution. This relationship of trust was a significant change in studio/talent relations, and it helped United Artists assemble a high-quality group of affiliated independent producers.⁷²

One important effect of the move toward independent production was the increasing power of talent agencies. Under the studio system, agents negotiated for their clients, but the major studios had the upper hand. Stars, directors, and writers had relatively few potential employers, and the standard Hollywood contract lasted seven years, with the studio holding all the options. A star at the peak of popularity might have some room for negotiation, but in a famous case Bette Davis found that she could not get out of her Warner Bros. contract. However, with the studios laying off employees and independent productions taking over, agents suddenly gained considerable power as potential packagers of motion pictures. Previously most personnel decisions (casting, key crew members) had been based on who was available on a studio lot. Loan-outs from one studio to another were possible, but studio executives always looked to their own personnel first. Now independent producers could hire from an increasing pool of free-lance talent as well as negotiating for studio contract personnel. Large talent agencies were uniquely situated to put together interesting film projects based on people they represented (such as actors, directors, writers, and cinematographers), and to pitch them to studios. The packaging of successful projects generated increased income for the agency and its clients, and this, in turn, led to more clout in the agency's future negotiations with the film studios.

Charles Feldman of Famous Artists represented a number of the top stars in Hollywood in 1950: Tyrone Power, Marlene Dietrich, Fred MacMurray, Randolph Scott, Ida Lupino, Susan Hayward, Ava Gardner, William Holden, Lauren Bacall, Charles Boyer, and John Wayne; also directors Howard Hawks, Edmund Goulding, Jean Negulesco, and Otto Preminger.⁷³ He used this roster of talent to enhance his own moneymaking activities, as well as maximizing opportunities for those he represented. In addition to being an agent, Feldman became a producer. He received a waiver from the Screen Actors Guild to produce an occasional picture, and agreed in return not to take his 10 percent agent's fee when he was also functioning as producer. The waiver was necessary because serving as agent and producer was perceived (correctly) as a conflict of interest—the producer might wish to limit salaries of the very actors whom he was representing as an agent. Feldman was the producer or co-producer on some of the top films of the 1940s and 1950s: Red River (1948), A Streetcar Named Desire (1951), and The Seven Year Itch (1955). He generally served more as a packager than as a line producer, often buying a story property and re-selling it to a studio, usually with a director and/or actors attached.

Lew Wasserman of MCA (Music Corporation of America) was the most important agent of the dominant Hollywood talent agency. MCA had been founded by Dr. Jules Stein to represent musicians of the big band era, but had quickly moved beyond this focus to other aspects of show business. By 1950, Stein was semi-retired, and Wasserman was running most aspects of the business. MCA represented Clark Gable, Marilyn Monroe, Joan Crawford, Rita Hayworth, Marlon Brando, Burt Lancaster, Tony Curtis, Dean Martin, Jerry Lewis, Ronald Reagan, Lana Turner, Gregory Peck, Cary Grant, and Jane Russell; also directors such as Alfred Hitchcock, Billy Wilder, and Nicholas Ray; writers such as Tennessee Williams, William Inge, and Arthur Miller; and British talent including Peter Ustinov, Michael Redgrave, Rex Harrison, Christopher Lee, Alec Guinness, Claire Bloom, and Audrey Hepburn.⁷⁴ MCA would offer package deals of its stars to producers of the highest-profile Hollywood projects, including film adaptations of Broadway musicals. For example, for Samuel Goldwyn's production of Guys and Dolls, MCA offered Betty Grable, Clark Gable, Bob Hope, and Jane Russell.⁷⁵ Though this package from the early 1950s did not work out, Goldwyn did end up using MCA client Marlon Brando in the lead role of the 1955 film.

Wasserman's MCA had become by the early 1950s a major center of power in the rapidly changing Hollywood film industry. One index of this power was a visit made by Arthur Krim, president of the re-energized United Artists, to Los Angeles in 1952. Krim was trying to attract top talent to his studio and was offering stars partial ownership of the films they would appear in. He went to Los Angeles specifically to meet with Wasserman about MCA clients Gregory Peck, Marlon Brando, Alan Ladd, Cary Grant, and James Stewart.⁷⁶ Remarkably, no producer was involved in the discussions—or, to put matters slightly differently, Wasserman was acting as de facto producer. Another, harder to pin down aspect of Wasserman's power is that he seems to have had considerable success in keeping clients off of the blacklist. Liberal Wasserman clients such as Burt Lancaster and Nicholas Ray were rarely troubled by accusations of Communist sympathies.

Independent or semi-independent production was very much shaped by individual contracts, and therefore differed from case to case. Nevertheless, the experience of a few prominent independent producers in the early 1950s can suggest some of the general directions of this trend.

Samuel Goldwyn was the dean of American independent producers. He had entered the film business in 1912, at age 28, and by 1916 had formed his own production company. (Goldwyn was never associated with Metro-Goldwyn-Mayer; that studio had absorbed one of his former companies.) Goldwyn released his films primarily through United Artists (1919 to 1939) and RKO (1939 to 1952). An energetic, combative producer, he bought excellent story properties (including many novels and Broadway plays) and hired top writers, directors, actors, cinematographers, and art directors to realize his projects. Goldwyn managed to compete with the big studios because of the quality of his stories and the box-office clout of his stars. In the 1940s, he had some of Hollywood's top talent under contract, including Gary Cooper (early 1940s), Danny Kaye (a Goldwyn discovery), director William Wyler, and cinematographer Gregg Toland. Goldwyn won the Academy Award for Best Picture in 1946, for The Best Years of our Lives.

By 1950, however, Goldwyn (at age 66) was slowing down. The flow of excellent story properties had stopped, and Goldwyn was making an undistinguished run of films: A Song Is Born (1948), with Danny Kaye; Roseanna McCoy (1949), a retelling of the Hatfield-McCoy feud; Edge of Doom (1950), a crime film directed by Mark Robson. Hans Christian Andersen (1952) was better, a big-budget musical starring Danny Kaye. Objections from Denmark that the story was not biographically accurate caused only temporary embarrassment. Though the film business was moving rapidly toward independent production, Goldwyn, a pioneer in this area, was not able to profit from the change. His practice of putting actors under contract and then loaning and trading with the major studios was out-of-step with the current arrangements that involved using a pool of free-lance talent. Goldwyn star Farley Granger, for example, complained that he simply did not have enough work in the early 1950s, and that he was able to make a name for himself only via loan-outs to RKO (They Live by Night,1949) and Alfred Hitchcock (Rope, 1948, and Strangers on a Train, 1951).⁷⁷

For Walt Disney, another veteran independent producer, the 1950s were a period of expansion and innovation. The Walt Disney Company, managed by Walt and his brother Roy, had been in Hollywood since the late 1920s, specializing in animation. Although Disney characters and the Disney name were known around the world, Disney was a very small and marginal company before 1950. Disney had won several Academy Awards in the 1930s, including a special achievement award for the animated feature Snow White and the Seven Dwarfs (1937), but the company had struggled in the 1940s. A bitter strike by Disney animators in 1941 disrupted operations and cost the company some of its most creative people. Disney survived the war years only because of commissioned projects from various branches of the federal government.

After World War II, Disney cartoons were in a poor position because less money and fewer bookings were available to short subjects. Feature-length animation was still viable, but this was a lengthy and cost-intensive type of filmmaking. The Disney Company therefore expanded the types of films it was making in two different directions. First, the company produced a series of medium-length and feature-length nature documentaries, labeled Disney True-Life Adventures. Such films cost far less than feature-length fiction or animation, yet they were popular box-office attractions. Disney also began to make feature-length fiction films. The first few were made in England, to take advantage of blocked funds—Treasure Island (1950), and The Story of Robin Hood (1952), for example. These low-budget adventure films aimed at children and families were modestly profitable, and so Disney was encouraged to make more live-action films. In fact, twenty-four live-action features were produced between 1950 and 1961.⁷⁸ These features often appeared on Disney's TV show ("Disneyland"), and in one unusual case a wildly popular TV series on Davy Crockett was recycled as the theatrical movie Davy Crockett, King of the Wild Frontier (1954).

The Disney Company made a major move when it established its own theatrical distribution company, Buena Vista Film Distribution Company, in 1953. With its stock of animated films, documentaries, and live-action features, Disney now had enough product to support a distribution network of its own. The company announced that one of its reasons for leaving RKO was that the True-Life Adventures needed special handling. Additionally, a Disney executive explained in 1954 that Disney was already handling "our own music, merchandise, and accessories," and so it was logical to "take over the selling of our own pictures."⁷⁹ Not mentioned, but undoubtedly a factor in the new enterprise, was a series of scandals associated with RKO when an ownership group that briefly took over the studio in 1952 became known to be involved in organized crime and gambling. Disney, with its appeal to the family trade, would have been damaged by the association. After several years of losses, the stability of RKO as a company was also in question. Disney's defection was a further blow to RKO, for Disney product had played an important role in supplying RKO's distribution system.

Director Howard Hawks is emblematic of the top-ranking Hollywood directors and actors who took advantage of the trend toward independent production without founding companies of any lasting impact. Hawks, like Goldwyn and Disney, had begun making movies in the silent film era. An original thinker with a knack for making excellent genre films, Hawks preferred short-term contracts to longer studio commitments. His first attempt at independent production was Red River (1948), produced by Monterey Productions and distributed through United Artists. The shareholders of Monterey were Hawks, his wife, Slim, and his agent, Charles Feldman; the working capital came mainly from a group of private investors. Red River was an excellent film that drew large audiences, but it did not make a profit for Monterey because Hawks went wildly over budget. Hawks did not begin to see his deferred salary until 1952.⁸⁰ Independent production often carried a high degree of risk.

In the early 1950s, Hawks divided his time between a studio contract at Twentieth Century-Fox and various independent ventures. Even the studio contract shows how the industry climate had changed, for it provided the director with profit participation, story approval, and the right to make one film per year elsewhere. At Fox, Hawks directed the comedies I Was a Male War Bride (1949) and Monkey Business (1952), the musical Gentlemen Prefer Blondes (1953), and an episode for the omnibus film O. Henry's Full House (1952). However, Hawks biographer Todd McCarthy notes that when it became clear that Darryl Zanuck wanted Hawks to make Zanuck films, rather than vice versa, Hawks lost interest in his Fox contract.⁸¹ He established another production company, Winchester Pictures, and began working on a three-picture, semi-independent deal for RKO. Two Winchester films were ultimately made: The Thing (1951, produced by Hawks and directed by Christian Nyby); and The Big Sky (1952). Hawks next made a deal with Warner Bros. and founded yet another company, Continental Company Ltd., to produce Land of the Pharaohs (1955). In all cases, Hawks's production companies were short-term vehicles intended to maximize his autonomy and compensation.

Actor Burt Lancaster became an actor-producer very early in his career and used these dual roles to create a significant body of work. On the basis of appearing in one Broadway play in late 1945, Lancaster was offered several Hollywood contracts. He chose to sign with Hal Wallis, who also had young stars Lizabeth Scott and Kirk Douglas under contract. Lancaster's contract was a relatively conventional seven-year deal, with a gradually increasing salary, and all renewal options held by the producer. It did, however, allow for one outside (non-Wallis) film per year.

Since Wallis had nothing for Lancaster to do, the young actor went to work for producer Mark Hellinger in the Hemingway adaptation The Killers (released 1947). This picture made Lancaster a star, which changed the Wallis-Lancaster dynamic. Lancaster and his agent Harold Hecht insisted on re-negotiating the contract, adding an option for a second outside film.⁸² Quickly using this new freedom, Lancaster and Hecht founded their first production company, Norma Productions (named after Lancaster's wife) in 1947. Their debut film as producers was Kiss the Blood off My Hands (1948), coproduced by Joan Fontaine's Rampart Productions. By 1950, Lancaster had independent production deals with Warner Bros. and Columbia plus the Wallis contract. In 1953 Lancaster switched to a new agent, the ubiquitous Lew Wasserman, who negotiated a favorable contract with United Artists. The non-exclusive Wallis contract was still in force until 1956, but by 1953 Lancaster was himself one of the leading producers in Hollywood. Via first Norma Productions and then Hecht-Hill-Lancaster (story editor James Hill was added as a third partner), Lancaster was to make a series of important films at UA, including Apache (1954), Vera Cruz (1954), Marty (1955), Sweet Smell of Success (1957), and Elmer Gantry (1960).

For Samuel Goldwyn, the independent productions of the late 1940s and early 1950s were simply "business as usual." For Howard Hawks, independent production offered more risk and more potential reward, but not dramatic changes in the way he made films. However, the examples of Burt Lancaster and Walt Disney show that the independent production trend of the 1950s could foster greater creativity and flexibility in the film industry. A star could become a producer and establish a creative identity as a filmmaker, not just as "talent." An animator could expand into documentary and live-action features, then to distribution, and on to television, establishing in the process a new creative identity. The changes of the late 1940s and early 1950s in Hollywood brought a share of instability, unemployment, even panic; but they also pushed the industry toward a different, more entrepreneurial, model of filmmaking.