Minutes of evidence taken before the Departmental Committee on Cinematograph Films (1936)

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36 COMMITTEE ON CINEMATOGRAPH FILMS 12 May, 1: Mr. Mr. F. W. Baker, Mr. M. N. Kjbahnby, [< '•■ < / < led A. Korda, Mr. N. Loudox and Captain the Hon. R. Norton. place in film production in Croat Britain, and prois submit that His Majesty's Government have now a unique opportunity of aiding the forward march of this important British industry and assisting it to a development which must have farreaching effects. . 5. The 1927 Act lias been successful in fostering development of British film production, and in this it has been remarkably successful. The requirement that a minimum proportion of British films must be acquired by renters and shown in cinema theatres was the primary method of attaining: that object. Tt may be contended in certain quarters that a healthy industry should no longer require li ; lative aid for its maintenance, but should be able to support itself without any such assistance. Reference is made later to tbe particular position of the film industry, which renders it especially susceptible to outside competition and particularly dependent on the home market. Since the Cinematograph Films Act, 1927, was passed the entire policy of His Majesty's Government in affording protection to industry generally has undergone modification. Whereas the Films Act was among the earliest measures of legislative assistance for industry, the principle of protection of industry has, since 1932, been widely applied with success in many other directions and is now a basic part of the country's economic policy. As the British film industry probably enjoys a smaller proportion of the home market than any other important British industry, producers venture to suggest that His Majesty's Government should not contemplate for a moment the withdrawal from the industry of the degree of legislative assistance at present afforded to it, but rather that they should favourably consider a reasonably progressive increase of Protection. 6. Producers feel it incumbent upon them to indicate .what would he the unquestionable effects of a withdrawal of the existing form of protection were the Quota Act to be allowed to lapse when its main provisions terminate in 1938, and were it not to be re-enacted in some similar form with anv modifications necessitated by changed conditions in the industry and experience gained during the past eight years. In their considered opinion, after very careful examination of the whole question in a series of conferences held by the Group during tbe past six months, producers are unanimously convinced that the complete or partial withdrawal of the protection afforded to their industry by the present Act would be disastrous. They are equally convinced that a reasonable and progressive increase in the quota will prove beneficial in the future as it has in the past. 7. Tn order to explain these statements it is necessary to go back to the early history of the industry. Before the war the British industry was a pioneer of film production and held an important place in the film industries of the world. During the War British production was closed down owing to tbe inevitable withdrawal of personnel and supplies of material. On tbe other hand the cinema theatres were kepi open and supplied with films produced in tbe United States. The American industry was thus enabled to build up a gigantic distribution organisation, based on its largo home market, and to acquire a substantial control of the British market, both in Greal Britain and throughout the Empire. This control was cemented bv the practices of advance booking and block booking of films, i.e.. tbe American companies compelled British exhibitors to book their films for long periods in advance (up to two years'), thus shutting out British pictures, and to book in blocks, taking both good and bad product together. These practices si ill continue, ami American renters will be able to maintain them unless prevented l'.\ law until such time as the British industry can provide exhibitors with a really equivalent source of supply. America las now about 18,0 !> theatres as against the 4.500 theatres in this country. In Hollywood it has a large city entirely devoted to film production, to which artistes and technicians flock from all parts of the world. American producing companies can spend £200.000 on a picture and recover the cost and a reasonable profit in their own countrv and can then afford to sell the picture in the i ritish market for a sum which would not yield to a British company a profit on a picture costing a quarter of that amount. On the other hand, it lias not yet been possible for British pictures to earn any substantial revenue in America. It is only by the help of the Quota Act that British companies have been able to build up an industry in competition with the dominant American industry. and if this protection were withdrawn, the following results would inevitably ensue: — (a) The general predominance of foreign films would be restored throughout the entire British market. (b) As the British production industry dwindled, prices for foreign films offered for rental here would tend to rise, and (since films recorded in the English language are the only ones likely ever to find favour with the mass public in the Empire) British exhibitors would be compelled to accept pictures at the prices offered by an organised foreign industry, or close their doors. (r) The results would be: — (i) The imperilling of the large capital sums invested in British studios. (ii) Reduced demand for labour of all kinds in film studios and in the industries supplying the trade. (iii) Serious reduction in the values of cinema properties. (iv) Loss of National prestige and the social influence of the British film throughout the Empire, with a corresponding increase in the influence of foreign films. (v) The eventual eclipse of all British films, loss of the growing export trade in such films and diversion, mainly to America, of the profits now being made by British producing companies. 8. The above results must be obvious to anyone having the slightest knowledge of the film trade as it exists to-day. It only remains, therefore, to put forward proposals for renewed or amended legislation together with explanations of the several points and the suggestions arising out of them. Explanation! of the working of the prbshnt A< r. S. The existing Act has. generally speaking, worked well. It is familiar to and understood h\ all sections of the trade, ami its main piovisions have been successfully applied without undue hardship in any quarter. In any re-enactment it would not appear neeessaiN to alter the basic form of the (piota provisions of the law. although there is certainly need for modification of some of its provisions. 10. Fundamental changes within the industry itself, which could not have been foreseen when the law was lir.st introduced, have made some of its conditions ineffective in practice. The ingenuity of individuals has succeeded in evolving methods of evading the -pint of the law if not its letter in certain respects. In any new Act it would seem essential to make these evasions no longer possible. 11. The present Act establishes two chief obligations namely (a) upon renters to acquire for the purpose of rental a percentage of British films in proportion to all films acquired, and (b) upon exhibitors to show a percentage "( British films in proportion to all films shown. In both cases the percentage (or quota) is based on the total footage oi