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10 -^ ^> ^> The Motion Picture Industry
Thus the feature picture, the star system, and the new motion picture theater all played their part in the commercial expansion of the industry. As a result of these major influences, a number of new factors became significant. First and most important, the product was given individuality both as to story and as to star, with the result that the exhibitors had a basis for picture selection. They were no longer leasing a thousand feet of film at random, but a particular story and a designated leading star. Second, these changes caused variations in value and in price both for different pictures shown in a given theater and for the same picture shown in different theaters. In the third place, because of the exclusive character of the licensing agreement and in order to insure the producer a maximum revenue to apply against negative film costs, a wider geographic distribution was sought. Because theaters were widely scattered and because the first showing of a feature picture exhausted its exhibition value in any small localized area, this necessity of securing wide national distribution for a product, varying in price and requiring careful servicing and much rehandling, involved two serious problems: the securing of efficient distribution and the securing of aggressive sales promotion.
With these requirements in mind, what was the situation in 1912? On the whole it was not a satisfactory one from the point of view of the producers, who naturally were desirous of securing the widest distribution possible. Although it is difficult to determine exactly the number of individually owned exchanges then existing, it is undoubtedly true that, considering the number of producers, there was a lack of an adequate number of really reliable exchanges available to any one producer.
With regard to the extensiveness of national distribution, the only company having a national system of exchanges in 1912 was the General Film Company, which distributed pictures exclusively for the manufacturers and importers in the Patents Company group. Since the productions of inde