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14 <^ ^ <^ The Motion Picture Industry
tion made necessary one bargain rather than two and placed him in a more advantageous position to drive that one. Bearing in mind the common assumption that there is and can be no relation between the cost of producing a motion picture and its sales value, the special significance of this argument becomes the more clear. Theoretically, too, a producer in control of his own distribution, since he deals with the exhibitor directly, is in a better position to judge the kind of picture to make, although actually this factor probably did not play much of a part in the story.
It is important to note that this trend toward integration of producer and distributor has become the common rule. Obviously, only those companies with adequate financial resources are able to pursue this policy. There are still small producers who continue to distribute through "state righters". That this is not the most economically advantageous policy may help to explain the trend toward largescale production in this industry. Both the small producer and the independent exchange are becoming relatively less and less a factor in the motion picture business. Today the majority of producers operate their own exchanges or distribute through those producers who do.
A study of the development of the Famous PlayersLasky Corporation, which Adolph Zukor organized in 1912 and which became the Paramount Famous Lasky Corporation after the acquisition of the Paramount company in 1916, illustrates this whole situation in a most interesting manner. While the entire evolution of this company well repays study, it is not possible here to trace the various steps in its history. Let it suffice to say that Mr. Zukor experienced his most serious difficulties in securing adequate distribution of his product at prices which allowed for expansion df the feature picture idea. He made repeated attempts to secure the necessary aggressiveness and cooperation both from the state right distributors and from the Paramount Pictures Corporation, a purely distributing organization. Failing in this, he acquired distribution units