Harrison's Reports (1951)

Entered as second-class matter January 4, 1921, at the post office at New York, New York, under the act of March 3, 1879. Harrison’s Reports Yearly Subscription Rates: United States $15.00 U. S. Insular Possessions. 16.50 Canada 16.50 Mexico, Cuba, Spain 16.50 Great Britain 17.50 Australia, New Zealand, India, Europe, Asia .... 17.50 35c a Copy 1270 SIXTH AVENUE New York 20, N. Y. Published Weekly by Harrison’s Reports, Inc., Publisher A Motion Picture Reviewing Service Devoted Chiefly to the Interests of the Exhibitors P. S. HARRISON, Editor Established July 1, 1919 Its Editorial Policy: No Problem Too Big for Its Editorial Columns, if It is to Benefit the Exhibitor. Circle 7-4622 A REVIEWING SERVICE FREE FROM THE INFLUENCE OF FILM ADVERTISING Vol. XXXIII SATURDAY, MAY 12, 1951 No. 19 A TIME FOR MORE REALISTIC SALES POLICIES The steady decline in box-office receipts, coupled with the apparent unwillingness of the producerdistributors to meet this condition in the form of reduced film rentals, despite their decreased production costs and increased distribution earnings, as reported in recent weeks by several of the film companies, has set off a wave of bitter resentment among the exhibitors. Exhibitor groups throughout the country, either through resolutions adopted at their conventions, or through their organisational bulletins, are castigating the distributors’ current selling policies as being entirely out of line with present trade conditions, and are demanding that film rentals be brought down to equitable levels. As evidence of what the exhibitors are up against in these times, the latest organisational bulletin of the Associated Theatre Owners of Indiana points to the annual report of 20th Century-Fox for the year 1950, wherein the company reported earnings of $4, 3 1 8,75 1 from film operations, and $5,234,509 from theatre operations. The comparative figures for the year of 1949 were $3,899,428 from film and $8,515,718 from theatres. “Here is proof of which side of this industry is taking the beating,” states the ATOI. “While theatre earnings declined 38% production and distribution earnings increased 10.7%. It is true that as a result of divestiture in 1950 that Fox lost approximately 6J/2 million in theatre receipts but this loss represents only about 8% of their 1949 theatre receipts. “Who can explain the motives of the policy makers of the film companies? What makes them tick? What conceivable parallel is there in any other business where the manufacturers’ earnings increase at the same time the retailers are losing customers and their profits are going down, down, down? “Aside from all ethical considerations, where is their realization of what this attitude is doing to the industry? Going to the movies, like any other form of recreation, is a matter of habit to a considerable extent. Miss a few golf week-ends, drop out of your bridge club and stay away from the pool parlor and you’ll soon lose much of the urge for golf, cards or pool. Force out some of the small town theatres, close up the marginal sub runs and make movies less easily accessible and just so many more people will discover they can get along without the movies. This will create more ‘problem situations’ and there will be an eating away at the edges of the movie-goer group in an ever constricting circle. “The exhibitor who is confronted with the problem of staying in business can stop debating what is right, what is wrong and what is just, what is unjust and recognize that he is not going to get much compassion shown toward him. (‘We’re not interested in your overhead — we can’t guarantee you a profit.’) Selfpreservation is the law and the exhibitor who is in the red or approaching that condition must, with determination, employ courage and common sense on every deal he makes. “At least he won’t hasten his demise by being coaxed and cajoled into signing deals that he knows preclude the possibility of a fair profit to himself.” The Independent Exhibitors, Inc., Allied’s New England unit, points to another part of the 20th-Fox report wherein it is set forth that the average production costs of individual features have decreased from $2,328,600 in 1947 to an estimated cost of $1,500,000 in 1951. “All of this,” states the Independent Exhibitors’ organizational bulletin, “is commendable and Twentieth Century-Fox certainly deserves the praises of the entire industry for its effective way of meeting the conditions prevalent in our business today. And other companies, too, have and are making plans to cut their overhead cost on productions and again we give cheers — but for the life of us, we can’t reconcile the present extortionate sales policies with the economy drive that has been accomplished in production. . . . “ ... If a film company can save approximately twenty-nine million dollars on thirty-five proposed pictures for this season as against their production cost of 1947, the exhibitor should be able to share at least a small percentage of that saving especially when theatres are being closed daily.” Still another exhibitor group that has taken up the matter of decreased production costs without benefit to the exhibitors in the Allied M.P.T.O. of Western Pennsylvania. Writing in the latest service bulletin of the organization, Wally Allen, the business manager, had this to say : “We all know that ‘At War with the Army,’ ‘Francis’ and the ‘Ma and Pa Kettle’ pictures were all made for less than the usual cost of a picture that usually grosses as much as these films. Wouldn’t it have been good business and built a lot of good will if Paramount and Universal, instead of trying to get top terms, would have sold these films for 25 or 30%? They still would have made a big profit, and they would have built up such good will with the exhibitors that they would not have had any trouble in liquidating some of the more troublesome productions.” ( Continued on bac \ page)