Harvard business reports (1930)

HARVARD BUSINESS REPORTS Cases on the Motion Picture Industry introduction Few people appreciate the commercial importance of the motion picture industry in the United States and fewer still appreciate the character of the problems confronting it. Much discussion has been devoted to the effects upon each other of the so-called legitimate stage and the cinema, to the effect of motion pictures upon the minds and the morals of our people, to the personalities so prominent upon the screen, to the technique of making and projecting films, and to scenario writing. Of the purely business problems connected with this tremendous industry, however, very little has been written, and much of what has appeared is without great value. Yet one conservative estimate places the number of American people who attend motion picture exhibitions every week at approximately 100,000000 and in so doing they expand approximately $1,560,000,000 annually. The coming of sound revolutionized the industry, and television may do so again. Meanwhile integration, both horizontal and vertical, has gone on apace, and the entrance of the electrical interests into the industry has had an effect comparable only to the increasing interest shown by many substantial financial groups. It is with some of the important aspects of the business problems connected with this development that the cases contained in this volume deal. A brief preliminary word concerning the organization and operation of the motion picture industry might be welcomed by those not familiar with it. Roughly speaking, the industry may be divided into four parts — production, distribution, exhibition, and auxiliary services. Production may be said to cover all the steps up to and including the completion of the requisite number of positive prints. Distribution activities relate to the rental of the films to exhibitors, the " dating in" of the pictures, the physical distribution of the films, and the collection of the 3