20th Century-Fox Dynamo (February 11, 1956)

THIS YEAR’S PATTERN MR. LICHTMAN DETAILS THE "WHY” AND "HOW” OF OUR 1956 RESPONSIBILITIES By AL LICHTMAN This is a momentous time in the his- tory of this company. 1956 will be a great test of all of us, and of the company. We are undertaking a herculean job, both in production and distribution, and that in spite of a disappointing 1955. However, as our plans are unfolded, you will realize we are facing the future with courage and faith. In production, as well as in distribu- tion, we have come to realize that, in spite of the terrific competition of home free entertainment, if we produce a really good picture and distribute and exploit it in a showman-like manner, we can be more successful than ever before. However, we have learned definitely that there is no room for mediocrity in the picture business, neither in production nor in salesmanship. We must be real pros in every department of our business, if we are to succeed despite free television. To begin with, as you have undoubtedly read in the newspapers and trade papers, with the courage and foresight character- istic of our President, Mr. Skouras, and our production head, Darryl Zanuck, we are undertaking the most ambitious program of production in the history of the company. We have appropriated more than $70,- 000,000 to produce 34 motion pictures, some of which are already completed, some in production and others in preparation for filming during this year. Of that number, we plan to release 24 pictures at the rate of two a month, with the hope that by producing 34 productions in the current year we will be able to stock- pile a sufficient number, so that by July it will not be necessary for us to release pic- tures as fast after their completion as we have been doing in recent months. This procedure will enable Mr. Ein- feld’s department to do a more complete job of exploitation coverage in all of its ramifications. This procedure also will enable us in the Distribution Department to, perhaps, do a better job of marketing those pictures by having more time to consider and test their values, because conditions are such that we cannot afford one nickle of revenue to escape us. The lineup of pictures for 1956 release, I believe, is far superior to the 1955 re- leases and, on the whole, far superior to the 1954 releases. In 1954 we released only 14 Cinema- Scope pictures, but we averaged a gross of $3,500,000 per picture in the United States and Canada. With backlog, shorts and a few 2-D outside pictures that year we managed to gross, in the United States and Canada, a little over $65,000,000, or an average of $1,250,354 per week. That was a fine job and I don’t be- lieve it was ever achieved by any other organization. The average for 1954 did not include the receipts on "The Robe” which, up to today in the domestic market, has grossed in excess of $16,000,000. Even during the disappointing year of Al Lichtman 1955 (including one picture which grossed only about $500,000) the average for 21 pictures released during its 12 months will be more than about $2,500,000 per picture when the full potential is realized. In quoting the figures I have reported, of course, I am speaking only of our own studio’s pictures filmed in CinemaScope. However, $2,500,000 per picture, based upon present day costs of production, ad- vertising, prints and distribution, is not enough to enable us to make a profit. S {Baking of costs, you must add to the negative cost the cost of prints which, on an average CinemaScope picture throughout the world, runs around $700,000 per picture. You must add, too, an average per picture another $300,000 for advertising, and also distribution cost at the rate of 31% world- wide. So, if you estimate the gross on a pic- ture and multiply it by 31%, together with negative, advertising and print costs, you will get the true cost of a picture. You will find that the average cost for our Cinemascope releases will run approxi- mately $4,500,000 per picture. And, I regret to say, that each year costs are increasing. That is so because in Hollywood the fiercest competition exists for fevery ingredient that enters into the making of a motion picture. They include stories, be they plays or books; actors, writers, directors and all the others. Also, in distribution, unions have been demanding more and more money each year. That is also true in production. However, our bus- iness is to make motion pictures and to rent motion pictures. We have to meet competition and be sufficiently ingenius to meet it wherever we encounter it; whether it is in produc- tion or distribution. And since the public has ordinary entertainment at home, we must excel in quality in every phase of our every undertaking. In my long experience in the motion picture business, I have found that nothing is impossible of achievement—if you have courage and faith and a complete knowledge of your job, and if you apply yourself to that job 365 days a year. You have to be a trail-blazer to really be an outstanding success in this business. The copyists and "can’t-be-doners” never get anywhere, and they accomplish noth- ing. As a typical example, based upon the constant cry on the part of many exhibitors, there would be ample reason for us to fall in step with them and cheapen our product, or even make fewer pictures. But, having faith in our business and, fortunately, backed also by ample re- sources, we are trying to serve the industry by making more pictures rather than fewer ones, and spending more money per picture in order to make every effort to achieve the highest possible quality. To justify such a program, it will be necessary, in many cases, to blaze new trails. And, we are going to blaze more new trails in this business during 1956, and achieve the biggest gross that has ever been rolled up by any film company since the beginning of this industry. Of course, you cannot reach our ob- jective by waving a magic wand. Our ob- jective can only be attained because of two things: 1. We will have the pictures with which to achieve it. 2. We are going to resolve to be the (Continued on page 7, column 1)