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Background of the Industry <^> <^> <^> <^> 3
next task was to insure an adequate supply of films to the exhibitor. The production of these films was undertaken by the same companies that manufactured and sold the equipment. Since the demand for film subjects exceeded the available supply, serious problems of distribution did not confront the early industry. The producer and the distributor also shared a definite community of interests since the patronage which the industry received measured the potentiality of the industry. The Kinetoscope Company, which distributed Edison's Kinetoscope machine and his early films, reached the exhibitors rather easily because of the relatively small number of such exhibitors. The Kinetoscope was a peep-show device by means of which the spectator peered through a lens which magnified the flashing images on a continuously moving film which, because of the persistence of vision, created the illusion of viewing objects in motion. The novelty of the Kinetoscope kept exhibitors alert to the possibilities of peep-show patronage to the fullest extent, and hence the need for sales promotion was at a minimum. The only contact required between the Kinetoscope Company and the exhibitors consisted of a catalogue describing the subjects and giving the list prices. Films were purchased outright, prices ranging from $10 to $25 a film, depending upon the subject matter contained. The showmen used these films until complete physical depreciation had been effected. The novelty of the peep show, together with the fact that each individual customer required a complete running of the film to get his penny's worth, allowed its continuance with no serious falling off in patronage. It soon became apparent that variety was needed in the stock, even though the films were not completely worn out. Those films abandoned by an exhibitor were no longer of any use to him, but they still were of exhibition value to the showman who had not already exhibited them to his public.
When successful projection made screen exhibition possible, the problem of distribution became much more serious. The first productions for this type of exhibition