Harvard business reports (1930)

234 HARVARD BUSINESS REPORTS that the pictures can be rented at this minimum figure. If the distributor had to sell each one of these small theaters each picture separately, the distribution cost would rise to at least $25 per picture or program, and in some cases it would reach $50. The producers and /or distributors being compelled to sell their pictures separately, with a resulting large increase in cost of distribution, would have to increase the prices of their pictures, and the exhibitors having to pay more for their pictures would have to increase their admission prices which the public, as is always the case, would have to pay. But when these admission prices are so greatly increased that they will become prohibitive— and that is what will occur — the public will refuse to go to the theaters and thousands of owners of the smaller theaters in the cities and towns throughout the country will be forced out of business. In my opinion one of the effects of this bill will be to eliminate automatically one-fifth of the motion picture theaters from the industry, and I submit that the abolition of the right of these distributors to wholesale their product and the imposition of these price-fixing provisions would be an unwarrantable interference with private business. It was also maintained that block booking simplified the exhibitor's buying problem and enabled him to book an entire year's program in advance. Mr. Felix Feist,7 general sales manager of the Fox Films Corporation, testified that an exhibitor buying in blocks could ascertain early in the season just what his program for the season would be. Since he would know what stars especially popular w-ith the public were to appear on his screen and when they wTere to appear, he would have the opportunity to arrange his program most effectively. Mr. Feist maintained that if the exhibitor bought pictures individually he would not know in advance what his program would be. That block booking guaranteed a definite income on all pictures was conceded to be of advantage to producers and distributors, who thereby were enabled to stabilize their programs. But many distributors maintained that it also benefited exhibitors. Producers operating under these conditions would find it possible, having a definite minimum income with wmich to work, to make pictures of higher average quality than they would if they had no assured income. While some pictures undoubtedly would fall below the level of standard of the group, distributors maintained that these pictures probably would be fewer in number under this system than under any other. 7 Federal Trade Commission v. Famous Players-Lasky Corporation, et at. Record of testimony, pages 1 7384-1 7393.