Hollywood Vault: Film Libraries before Home Video

By Eric Hoyt

Hollywood Vault is the story of how the business of film libraries emerged and evolved, spanning the silent era to the sale of feature libraries to television. Eric Hoyt argues that film libraries became valuable not because of the introduction of new technologies but because of the emergence and growth of new markets, and suggests that studying the history of film libraries leads to insights about their role in the contemporary digital marketplace.

The history begins in the mid-1910s, when the star system and other developments enabled a market for old films that featured current stars. After the transition to films with sound, the reissue market declined but the studios used their libraries for the production of remakes and other derivatives. The turning point in the history of studio libraries occurred during the mid to late 1940s, when changes in American culture and an industry-wide recession convinced the studios to employ their libraries as profit centers through the use of theatrical reissues. In the 1950s, intermediary distributors used the growing market of television to harness libraries aggressively as foundations for cross-media expansion, a trend that continues today. By the late 1960s, the television marketplace and the exploitation of film libraries became so lucrative that they prompted conglomerates to acquire the studios.

The first book to discuss film libraries as an important and often underestimated part of Hollywood history, Hollywood Vault presents a fascinating trajectory that incorporates cultural, legal, and industrial history.

• Language: English
• Publisher: University of California Press
• Release date: Jul 3, 2014
• ISBN: 9780520958579

Eric Hoyt

Eric Hoyt is Associate Professor of Media and Cultural Studies in the Department of Communication Arts at the University of Wisconsin-Madison and is Director of the Media History Digital Library. He designed, developed, and produced the MHDL’s search and visualization platform, Lantern, which received the 2014 Anne Friedberg Innovative Scholarship Award from the Society for Cinema & Media Studies.

Book preview

Hollywood Vault

Hollywood Vault

Film Libraries before Home Video

ERIC HOYT

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University of California Press

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University of California Press

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Library of Congress Cataloging-in-Publication Data

Hoyt, Eric.

Hollywood vault : film libraries before home video / Eric Hoyt.

      pages cm.

    Includes bibliographical references and index.

ISBN 978–0–520-28263-6 (cloth : alk. paper)

ISBN 978–0–520-28264-3 (pbk. : alk. paper)

ISBN 978–0–520-95857-9 (e-book)

    1. Motion pictures—United States—Distribution. 2. Motion picture studios—United States—History—20th century. 3. Motion picture industry—United States—Finance. 4. Motion picture film collections—Economic aspects. I. Title.

    PN1995.9.D57H69 2014

    384’.840973—dc232013048758

Manufactured in the United States of America

23  22  21  20  19  18  17  16  15  14

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In keeping with a commitment to support environmentally responsible and sustainable printing practices, UC Press has printed this book on Natures Natural, a fiber that contains 30% post-consumer waste and meets the minimum requirements of ANSI/NISO Z39.48–1992 (R 1997) (Permanence of Paper).

For Emily, Rumi, and Liam

Contents

List of Figures and Tables

Acknowledgments

INTRODUCTION

1. THE TRIANGLE FRAUDS AND THE BIRTH OF THE FILM LIBRARY (1910S)

2. SIDE BUSINESS (1920S)

3. DERIVATIVES AND DESTRUCTION (1930S)

4. POSTWAR PROFIT CENTER (1940S)

5. NEGOTIATING TELEVISION (1950S)

6. SEVEN ARTS AND INDUSTRY TRANSFORMATION (1960S)

Epilogue

Notes

Bibliography

Index

Illustrations

FIGURES

1. MGM reissue profits versus total profits by season, 1944–1945 to 1949–1950

2. Universal 16mm gross revenue, 1936–1952

TABLES

1. Median age, rental revenue, and profit of MGM theatrical reissues, 1930–1939

2. Estimated volume of U.S. television advertising, 1950–1955

3. Warner Bros. library television versus theatrical reissue income, 1956–1961

Acknowledgments

The researching and writing of Hollywood Vault spanned many life transitions: from graduate student to professor, from Californian to Wisconsinite, and from an existence without kids to life as a parent of multiples. I would like to thank the generous people who helped this project (and me) along during the ups and downs.

This project began in the Critical Studies Division of the University of Southern California’s School of Cinematic Arts. USC was a wonderful environment in which to write a dissertation. I enjoyed great weather while being close to the archives and surrounded by smart and energetic people. Thank you to my corps of fellow graduate students, especially James Crawford, Kate Fortmueller, Brian Jacobson, Luci Marzola, Casey Riffel, and Brett Service, for always being excellent sounding boards. I was fortunate to have an all-star team of a dissertation committee—Priya Jaikumar, Henry Jenkins, Rick Jewell, and Tara McPherson—who all reshaped my thinking about film libraries and connected me to important career opportunities. I am also grateful to Aniko Imre, David James, Akira Mizuta Lippit, Michael Renov, and Bill Whittington and, over in the Peter Stark Producing Program, Larry Turman, Joe Cohen, and Richard Shepherd. A Provost’s PhD Fellowship from USC’s Graduate School provided generous research funding and enabled me to spend a year writing and parenting in Northern California.

I owe my biggest thanks to my dissertation committee chair, Ellen Seiter. Ellen’s incisive comments sharpened my writing and thinking. Her mentorship transformed my career. I think about her unique combination of humility, thoughtfulness, and rigor every time I meet with a graduate student.

After graduate school, I hit the jackpot of academic jobs by landing as an assistant professor in the Department of Communication Arts at the University of Wisconsin–Madison. The weather isn’t as good as in Los Angeles, but the community and cheese curds more than compensate. I am grateful to UW-Madison’s Graduate School for providing research funds that enabled the completion of this project and to the PhD students Derek Long and Anthony Tran for their valuable assistance in preparing the final manuscript. Kit Hughes, a PhD student, helped me take the photograph in the vault of the Wisconsin Center for Film and Theater Research that is used on the book cover.

I especially thank my faculty colleagues in the Media and Cultural Studies and Film areas of the Communication Arts Department: Tino Balio, Maria Belodubrovskaya, David Bordwell, Kelley Conway, Jonathan Gray, Michele Hilmes, Lea Jacobs, Derek Johnson, Vance Kepley Jr., Lori Kido Lopez, Jeremy Morris, J. J. Murphy, Ben Singer, Jeff Smith, and Kristin Thompson. All of them—even some who are technically retired—have either directly aided this project or helped support me during my first two years on the faculty.

To paraphrase Blanche DuBois, I have always depended on the kindness of archivists. Sandra Lee Aguilar and Jonathon Auxier at USC’s Warner Bros. Archives and Ned Comstock at USC’s Cinematic Arts Library were vital collaborators in Los Angeles. I am also grateful to the tremendous team at the Academy of Motion Pictures Arts and Sciences Margaret Herrick Library, especially Barbara Hall, Val Almendarez, Jenny Romero, and Sandra Archer, and the staffs of the Seaver Center for Western History Research at the Los Angeles County Museum of Natural History and the three National Archives Records Administration sites I visited, in Riverside, California; College Park, Maryland; and New York City. My thanks also go to Wendy Hagenmaier and Joseph Pomp for taking photographs of documents in Austin and New York City when I was not able to visit research sites in person. Here in Madison, I’m fortunate to be a short walk away from the terrific collections of the Wisconsin Center for Film and Theater Research (WCFTR). Thank you to the WCFTR team of Vance Kepley Jr., Maxine Ducey, and Mary Hulsebeck and to Harry Miller at the Wisconsin Historical Society for providing access to the collections. And thank you to Rudy Behlmer, Rick Jewell, Karl Thiede, and Alison Trope for loaning me documents from their personal collections.

I could not have completed my dissertation or this book without the help of Tom Kemper and David Pierce, who loaned materials from their collections and read every chapter draft I gave them. Tom offered thoughtful notes on early versions of the manuscript, and I’ve come to regard him as an older brother—a great friend who simultaneously awes me in his abilities as a film historian, teacher, and parent of young children. David knows more about the history of Hollywood film libraries than anyone else on the planet, and I cannot thank him enough for the insights he offered, mistakes he corrected, and archival documents he shared. Getting to know David and collaborating with him on building the Media History Digital Library has been one of the unexpected joys of this project.

I presented portions of this book at four conferences: Media Fields: Infrastructures (2009), hosted by the University of California–Santa Barbara, What Is Film? (2009), hosted by the University of Oregon, Rethinking Media Archivism (2010), hosted by the National Library of Sweden, and the 2013 Society for Cinema and Media Studies Conference in Chicago. The introduction and the epilogue contain sections that were first published in The Future of Selling the Past: Studio Libraries in the 21st Century, Jump Cut 52 (Summer 2010). Thank you to the conference organizers, journal editors, and audiences—your feedback made this project stronger.

I feel fortunate to belong to a broad community of film and media scholars who are also interested in questions of industry history and media circulation. I am grateful to Emily Carman, Peter Decherney, Philip Drake, Kathryn Fuller-Seeley, Nitin Govil, Barbara Klinger, Regina Longo, Paul McDonald, John McElwee, Ross Melnick, Toby Miller, Nina O’Brien, Jan Olsson, Lisa Parks, Alisa Perren, Anne Helen Petersen, Jennifer Porst, Tom Schatz, David Shepard, Katherine Spring, Shelley Stamp, Daniel Steinhart, Haidee Wasson, Mark Williams, and Chuck Wolfe for stimulating conversations and perfectly timed words of encouragement. Thanks especially to Charles Acland and Jennifer Holt for their enthusiastic responses to the manuscript and constructive suggestions for how to improve it.

It has been a pleasure to work with University of California Press on producing this book. Thank you to Mary Francis, editor extraordinaire, for so many fun and productive conversations and for guiding me through the publishing process. Juliana Froggatt carefully copyedited the manuscript and helped me more clearly articulate several key points. I also appreciate the input of Kim Hogeland, the Editorial Committee reader, and everyone else on the UC Press team who has had a hand in bringing this book to life.

Reaching deeper into my personal vault: Scott Curtis, Paul Edwards, Chuck Kleinhans, and Michael Sherry all changed my life when I was an undergraduate at Northwestern University. I am grateful for the potential they saw in me back then and for the support they continue to offer.

Finally, I extend my supreme thanks and love to my family. I would not be the person I am today without my father and mother, Christopher and Elizabeth Hoyt, who always encouraged me to pursue my passions and modeled the values of empathy and hard work. Thank you to my sister, Whitney, and brother, Will, for everything they teach me about life, and to my in-laws, Carl and Debby Hagenmaier, for their unwavering support. To my grandparents both living and deceased—Bill Rutledge, Donna Rutledge, Stuart Hoyt, and Barbara Kreuzer—I am deeply grateful for all you’ve given me.

This book is dedicated to my wife, Emily Hagenmaier, and our two children, Liam Oliver Hoyt and Rumi Boone Hoyt, who are about to turn three years old as I finish this project. Emily, thank you for your love, your partnership, and always believing in me. Liam and Rumi, we completed this project together: I wrote the first draft of chapter 1 while you were growing inside your mother, outlined chapters 2 and 3 while Rumi slept on my chest, and edited the final manuscript while you brightened our driveway with chalk. You have shown me how much more to the world there is than academia while also providing my motivation to finish this book. I can’t wait to watch City Lights, Meet Me in St. Louis, and the other treasures of Hollywood’s vault with you.

Introduction

In 2004, a consortium of Sony, Comcast, and three private equity firms made what looked like a safe investment: they bought a film library, acquiring MGM for five billion dollars in a leveraged buyout. The consortium intended to produce and distribute new content, but the group would not have made the deal without the stable cash flow of MGM’s library of more than four thousand films and thousands of hours of television programming.¹ The MGM library had been a national news story two decades earlier, when, in 1986, Ted Turner purchased it from Kirk Kerkorian for roughly $1.1 billion—a sum that most commentators at the time thought was outrageously high. Within several years, however, Turner had proved the skeptics wrong, amortizing his purchase through colorization, cable distribution, and home video sales.² Turner absorbed MGM’s library of classics, including The Wizard of Oz (1939) and Meet Me in St. Louis (1944), into Turner Broadcasting Systems, which he eventually sold to Time Warner for $7.5 billion.³ Although the post-Turner MGM had lost the Golden Age classics, the studio still boasted an impressive library—comprising MGM’s post-1986 output, the United Artists library, and a patchwork of acquired libraries, including Orion, AIP, Filmways, and PolyGram. By all outward appearances, the 2004 leveraged buyout of MGM looked like a low-risk investment—DVD and cable distribution offered valuable ways to monetize old content, and MGM’s library generated more than five hundred million dollars in cash for both 2007 and 2008.⁴

MGM was not the only studio enjoying high profit margins from the business of content libraries in the early 2000s.⁵ Edward Jay Epstein reports that Time Warner grossed more than two billion dollars in 2009 by distributing its library—which contains more than six thousand feature films and twenty thousand hours of television programs—across U.S. and global television (in other words, this does not even count the home video business).⁶ Studios use the term library to describe the films and television programs they own that have already gone through the first cycle of distribution, which, in the case of films, encompasses separate windows for a theatrical release, video on demand, home video, pay television, network television, and syndicated television. After five to seven years, a particular film’s cost has already been fully depreciated as an asset, the executive responsible for the project has been either promoted or fired, and the movie has generated the vast bulk of its ultimate earnings. Any new money to come in as library value is largely profit. Multiply this by the huge volume of library titles—a fraction of which become evergreens, which perform exceptionally well after the first cycle—and the studio can add hundreds of millions of dollars each year to its bottom line. Unlike with a major theatrical release, which requires tens of millions in marketing expenses, there are relatively few costs involved in bringing library titles to market. As Epstein has noted, these libraries give the established Hollywood studios a comparative advantage against any new firms entering the marketplace, which lack the annual library revenues that help cover overhead and offset any disastrous new productions.⁷

How did we get here? When did old movies become valuable? How has the marketplace for film libraries changed? And what have been the consequences? These are the questions that drove the research and writing of this book. The answers bear little resemblance to the narrative I initially imagined. The history of studio libraries is not a linear tale of worthless assets incrementally increasing in value through the introduction of new technologies. Instead, it is a chronicle of starts and stops, buyer demand and studio resistance, and, most of all, a shifting media and cultural marketplace.

The 2004 MGM leveraged buyout did not go as expected. Whereas library revenue during the first few years generated enough cash to cover the studio’s overhead and interest payments, it decreased significantly in 2009.⁸ The following year, MGM filed for bankruptcy. Industry commentators noted that its buyers did not anticipate the drop in DVD and home video revenue.⁹ In this view of events, Sony, Comcast, and the private equity firms erred by assuming that the future would resemble the past. But this is not a satisfying explanation. As I will demonstrate in the chapters ahead, MGM’s buyers erred by assuming the future would resemble the recent past. If private equity had understood the full history of film libraries, then they might have charted a different course.

HISTORICAL SCOPE, ARGUMENT, AND INTERVENTION

Hollywood Vault is the story of how the business of film libraries emerged and evolved, spanning from the silent feature era to the sale of feature libraries to television. The history begins in the mid-1910s, when the star system and other developments prompted a market for old films featuring current stars. Although the Triangle Film Corporation extensively exploited the reissue market in the late 1910s, the companies we’ve come to know as the major Hollywood studios generally subordinated the reissue of films in the 1920s and 1930s. Reissues interfered with the studios’ more pressing goals, of gaining market share and maximizing ticket sales in the studio-owned first-run theaters. After the transition to sound, the reissue market declined, but the studios used libraries for the production of remakes and other derivatives. The turning point came in the mid-to-late 1940s, when changes in American culture and an industry-wide recession convinced the studios to employ their libraries as profit centers through the use of theatrical reissues.

This book concludes with the period when, according to conventional wisdom, the history of the film libraries’ economic significance began—with the distribution of old Hollywood films on television. In contrast to the studios’ defensive uses of libraries and reissues in the 1940s, the intermediary distributors Matty Fox and Eliot Hyman used the growing market of television in the 1950s to aggressively harness libraries as foundations for cross-media expansion, laying a blueprint that increased in importance in the 1960s and continues today. By the late 1960s, the television marketplace and the exploitation of film libraries had become so valuable that they prompted conglomerates to acquire the studios. I have structured this book, then, as a historical narrative with a beginning (film libraries in the 1910s turned into an industry problem), middle (the Hollywood studios in the 1940s embraced their libraries as profit centers), and end (film libraries prompted conglomerates to acquire the studios). This particular narrative ends in 1970, but as I have already suggested and will revisit in the epilogue, the early history of film libraries offers many lessons for the contemporary digital marketplace.

Hollywood Vault’s most important lesson for understanding studio libraries, past and present, is that the role of technology has been improperly understood. I seek to overturn the pervasive assumption that film libraries have gained value chiefly through the introduction of new technologies. In Movies at Home: How Hollywood Came to Television, for instance, Kerry Segrave describes the Hollywood throwaway mentality that once a movie had made its way through the theatres in its first to third runs, it was finished, no other possibilities existed for it, at least prior to television. Segrave subsequently claims that only Disney had a reissue policy in which films were recycled back into cinemas every seven years or so and that it was generally agreed that the film capital had indeed ‘neglected’ the reissue market.¹⁰ In her otherwise excellent essay on the 1920s little cinema movement, Anne Morey assumes that the film industry dismissed the economic value of its vaults until television revealed what might be made of them.¹¹ These claims are simply inaccurate. As I argue in chapter 4, film libraries became vital profit centers for the Hollywood studios during the post–World War II theatrical reissue boom, a full decade before the studios sold their feature films to television. In fact, the market for film reissues was so large in the mid-to-late 1940s that the Hollywood unions vowed to take action against the reissue problem that they believed was depriving them of employment. In the absence of any thorough history of film libraries, it is easy to fall back on the assumption that old films were throwaways before the introduction of television and an array of subsequent technologies, including home video, colorization, DVD, and digital streaming.

Film libraries became valuable not because of the introduction of new technologies but because of the emergence and growth of specific markets. From 1915 to 1970, these markets were sometimes tied to new technologies, such as 16mm film and television. For most of this period, however, existing 35mm film projectors were the most financially significant technology for exploiting libraries. New technologies are important for the possibilities they afford, but a dynamic marketplace determines their adoption and impact.

Once we come to see the history of film libraries as rooted in markets, we are obliged to understand the full range of marketplace participants. Most of the contemporary literature about content libraries—including some of my earlier writings—suffers from focusing too heavily on the supply side.¹² The industry press asks supply-side questions: How can studios exploit libraries across new technologies? How can they adopt new technologies in a way that creates new revenue streams without cannibalizing traditional markets? These questions, while important, are insufficient. The answers they produce offer a top-down perspective on the industry, limiting our focus to the producers and suppliers: the studios. For most of the period from 1915 to 1970, however, the demand of audiences and, especially, business buyers such as motion picture exhibitors and TV stations drove the library business. In the early 1940s, the exhibitor demand for old movies actually outpaced the supply. Instead of focusing on the supply side, I analyze the full ecology of the media industries, framing the business of film libraries as a dynamic marketplace of producers, intermediaries, labor, business buyers, and audiences.

Hollywood Vault draws from and contributes to historical scholarship on the American media industries and the growing subfield of media industry studies. No previous book has examined the history of Hollywood film libraries, but my study intersects with a number of film and television histories. It is particularly indebted to the work of Christopher Anderson, Tino Balio, William Boddy, David Bordwell, Douglas Gomery, Michele Hilmes, Jennifer Holt, Richard B. Jewell, Tom Kemper, Derek Kompare, David Pierce, Alexander Russo, Thomas Schatz, Janet Staiger, and Kristin Thompson.¹³ In addition to providing essential secondary sources for my research, these scholars offer models of media industry historiography.

By examining the full ecology of the media industries, we also gain new insights into cinema’s cultural history, particularly American culture’s shifting relationship to old films. Peter Decherney, William M. Drew, Caroline Frick, Jennifer Horne, Barbara Klinger, Dana Polan, Anthony Slide, Eric Smoodin, Alison Trope, and Haidee Wasson have all analyzed the changing cultural value of old works of cinema.¹⁴ Although I discuss broad cultural shifts and the responses of critics and audiences to old movies, Hollywood Vault belongs more to the field of industrial history than to cultural history, as it focuses on the economic value of film libraries in a marketplace context. As I argue, though, the media industries include a diverse range of participants, who have frequently disagreed about the best and appropriate uses for film libraries. By moving away from a supply-side view, we gain a more nuanced perspective on the way old films have circulated in American culture. We also avoid drawing a simple contrast between the studio owners of films versus nonprofit institutions, critics, and audiences.

In addition to the work of film and media scholars, I draw from the field of economics. The works of Michael E. Porter and Richard E. Caves have especially influenced my analysis of the ecology of the media industries. Porter’s seminal 1980 book, Competitive Strategy: Techniques for Analyzing Industries and Competitors, offers a guide to the structural analysis of industries, stressing the importance of relating a company to its environment. He argues that an industry’s five competitive forces—entry, threat of substitution, bargaining power of buyers, bargaining power of suppliers, and rivalry among current competitors—reflect the fact that competition in an industry goes well beyond the established players.¹⁵ We cannot understand a firm’s environment, in other words, by studying simply the established players, such as the major film studios and television networks. We need to account for the entire ecology of the industry, the full range of its marketplace participants and potential entrants. In Creative Industries: Contracts between Art and Commerce, Caves combines structural analysis with contract theory to identify the ways in which creative industries are distinguishable from other industries. Especially salient to the study of film libraries are his insights into how creative industries grapple with questions of performance uncertainty, storage costs, collecting rents, and internalizing versus externalizing distribution.¹⁶ Porter and Caves demonstrate that if we want to understand Hollywood libraries, we need to look beyond the studios and take stock of the intermediaries, business buyers, and other marketplace participants.

Porter and Caves offer excellent methods of economic analysis and for asking questions about media industry ecology. What they do not provide are the answers to those questions. Historical answers come from evidence, not economic theories. My evidence is in numerous archives and historical trade papers. Wherever possible, I triangulate these archival and journalistic sources—filling in gaps, testing claims off one another, and striving to present a history that is both rich and accurate. In my analysis and writing, I prioritize the most important developments and players in the history of Hollywood film libraries. An industrial history tracking every single reissue or library deal would be tedious—and endless. This book’s emphasis on theatrical reissues rather than 16mm or other small-gauge film stocks reflects the fact that the former were far more economically significant than the latter throughout the period of study. Fortunately, the recent surge in nontheatrical film scholarship is already providing insights into the networks and cultures of 16mm film circulation.¹⁷

CONCEPTS AND THEMES FOR UNDERSTANDING THE USES OF A FILM LIBRARY

The six chapters that follow track the ways in which film libraries have changed in value, concentrating especially on how marketplace participants have used them. What constitutes a library use depends on the subject’s position in the marketplace. A studio that owns a library considers different uses than an exhibitor that is considering buying (or, more accurately, renting) films from a library. Audiences, critics, government regulators, and labor groups may attempt to control or influence the uses of libraries. Out of the many uses and users, though, some have proved to be especially consequential. Throughout Hollywood Vault, I return to five concepts and themes central to the business uses of film libraries: the copy and the derivative, strategic industry functions and industry specificity, innovations from the margins, the demand side of business buyers and audiences, and labor’s struggle for compensation and control.

From the standpoint of a copyright owner, all commercial uses of a film library can be distilled into one of two categories: the copy and the derivative. My distinction between them stems from U.S. copyright law, which in fact grants motion picture copyright owners five exclusive rights: to reproduce the work in copies, to prepare derivative uses of the work, to distribute copies, to perform the work publicly, and to display the work publicly.¹⁸ For the purpose of analyzing film libraries, however, I have chosen to bundle together the rights to reproduce, distribute, perform, and display works as part of the copy. If you own the copyright to a film, you exclusively control the right to circulate copies of the work for the duration of that copyright. The copy circulates through theatrical reissues, 16mm rentals, and television broadcasts. However, copyright owners also control the rights to create derivatives—works that use substantial portions of the copyrighted material. Derivative uses for film libraries include remakes and stock footage. Importantly, derivatives receive copyright protection as new works; their copyrights can live on even after the underlying material enters the public domain.

The line between a copy and a derivative is not always clear. While a straightforward film-to-video transfer creates a copy that simply exists on a different format, the colorization of a black-and-white film creates a derivative work entitled to new copyright protections (the legal reasoning is that the process, though repugnant to cinephiles, involves creative decisions about what colors to apply).¹⁹ Despite the ambiguity, distinguishing between the two forms helps us to identify the ways that a media company puts its library to use. Throughout this book, I track shifts in which use—distributing copies or producing derivatives—the studios have considered more important. In the early 1930s, for instance, the studios valued their libraries primarily for the production of derivatives—remakes, shorts, and cartoons based on one or more copyrights owned by the studio. In the late 1940s, on the other hand, the studios valued their libraries for the low-cost, high-margin business of distributing reissues (copies).

Whether choosing to distribute copies or produce derivatives, library owners must consider the industrial functions of these uses and how library exploitation may impact existing strategies. A comparison between the film library and the publishing backlist helps to clarify this point. In a broad economic sense, film libraries and publishing backlists are similar. All copyright industries incur high fixed costs for the first unit of production and low marginal costs for reproduction. Despite this similarity, the business of film libraries developed and functions differently than that of backlists. Since the late eighteenth century, backlists have served as barriers to entry against potential competitors and low-cost, low-risk profit centers for publishers. In contrast, the Hollywood studio system developed other strategies to perform these same industrial functions—most notably, vertical integration, B-movie production, and block booking. Furthermore, the studios deliberately subordinated the reissue of films during the 1920s and 1930s in order to concentrate on maximizing market share and the profitability of their first-run theaters, which carried high fixed costs. It was not until the post–World War II industry recession that the studios turned toward their libraries as profit centers. Chapter 2 further analyzes the differences between the film library and the publishing backlist. The comparison demonstrates that elements of two different industries that appear similar may play entirely different functions in the context of those industries. It also shows why the business of film libraries requires its own history and cannot be understood simply as an extension of the backlist.

Because the most successful Hollywood studios were vertically integrated corporations that subordinated the business of reissues in order to advance more important strategic objectives, the major innovations in the business of film libraries have come from the industry’s margins. The term margins is, of course, relative. In the present context, I use it as a way to group the second-tier studios and intermediary distributors that introduced new methods for exploiting library copies. Chapter 1 profiles Harry Aitken, who, after running the Triangle Film Corporation into the ground, monetized his library through retitling and reissuing William S. Hart films. In chapter 4, I provide a case study of postwar Universal Pictures, one of the Little Three studios that did not own theaters. In contrast to the more conservative MGM, Universal aggressively exploited its libraries across media—creating a subsidiary, run by Matty Fox, that acquired 16mm film libraries and distributed certain titles to nontheatrical venues and television.

In addition to second-tier studios, the most important innovators in the library business have been intermediary distributors. Although this category includes nontheatrical film services, I focus most of my attention on the distributors that have serviced movie theaters and television stations. These intermediaries obtained feature films by purchasing or licensing them from independent producers, who were more incentivized than the studios to exploit their old assets, because they had no distribution infrastructure or exhibition business that they needed to prioritize. During World War II, the box office success of two intermediary distributors, Astor and Film Classics, persuaded the major studios to abandon their temporary policy of not reissuing films and instead imitate the intermediary distributors by prepackaging double features of old films. In the 1950s, the first two major Hollywood film libraries reached television, through the innovative buying and selling methods of Matty Fox (who obtained the RKO library) and Eliot Hyman (who purchased the Warner Bros. library). Fox believed that pay television would transform the business of film libraries, though he sold the rights to the RKO library long before this occurred. Hyman recognized that the value of film libraries for television could provide the financing mechanism (through cash flow and borrowing base) to grow a small company into a major Hollywood studio. In pursuing this vision, he created the blueprint for the uses of the modern conglomerate content library.

No matter their cleverness, the intermediary distributors would have had no business to innovate were it not for the demand of buyers. For most of the period from 1915 to 1970, the needs of business buyers—most notably, motion picture exhibitors and television stations—drove the business of film libraries. Motion picture exhibitors demanded old movies not as an expression of cinephilia but as a conservative business strategy. As I explore in the first four chapters, exhibitors rented reissues and revivals for a fraction of the price of a new film. Additionally, old movies were attractive to exhibitors because of their predictability: an old picture’s star power, popularity, and merit were known in advance, unlike those of a new release. The needs of local television stations for filmed content in the late 1940s and early 1950s led to the development of a similar marketplace for old films, even though TV stations prior to 1956 lacked access to most of the top Hollywood features.

Exhibitors and television stations demanded old movies to serve their business needs, but they were ultimately in the business of entertaining audiences. In addition to business buyers, we need to consider the industry’s end users (though for the sake of readability, I generally use the more human-sounding audiences over end users). Since the rise of the star system in the early-to-mid-1910s, movie fans have sought access to the old films of their favorite stars, preceding critics as proponents of old film screenings. In the 1910s and 1920s, most critics believed that rapid developments in the art of film rendered most old movies inherently inferior to new ones. They were more likely to discourage than encourage the watching of old films. Critical attitudes toward older films warmed in the years following the transition to sound. And in the 1940s, the demand from both audiences and critics for old films underwent a noticeable shift—moving from the fringes of fandom toward the mainstream. This was part of broader wartime and postwar cultural turns toward nostalgia. When old films reached television in the late 1940s and 1950s, the willingness of audiences to stay up late and watch bad movies provoked condescending remarks from critics, leading the Chicago Daily Tribune to wryly remark, Nobody except the public likes movies on TV.²⁰

Business buyers anticipated the demands of audiences for certain types of older films and sometimes solicited their input. Postwar revival theaters encouraged participation by inviting audience members to cast votes for the old films they wanted to see. Audiences gradually obtained noncommercial means to access old films—such as the Museum of Modern Art’s Film Library and the growth of film societies and college film courses following World War II. Yet the reach of these nonprofit alternatives was small compared to those of commercial mediums of motion picture exhibition and television. Small-gauge film libraries, such as the 16mm and 8mm Kodascope Library, offered another means of access. For the film lover fortunate enough to own a 16mm or 8mm projector and to possess enough disposable income to rent prints, the small-gauge market offered the possibility of full control over film programming—limited, of course, to whatever titles the catalog offered. Despite the rise of nonprofit and small-gauge alternatives, however, from 1915 to 1970, most Americans encountered old films while attending commercial movie theaters and, later, while watching television. These audiences participated in the commercial marketplace for film libraries, demanding that business buyers obtain specific types of old movies.

As business buyers and audiences demanded access to old movies, Hollywood labor groups advocated for their own needs. "Our industry is one of the few in the world where the talents and skills of its workers, preserved on strips of celluloid, can be used repeatedly without any