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50 ^> <^ <^> The Motion Picture Industry
supplying various forms of motion picture insurance, laboratories,8 play and story brokers, storage companies, and numerous other companies such as title studios, costumers, camera dealers, film laboratories, and lighting specialists.
As has already been indicated, distribution relates to the rental of films to the exhibitors, dating in of the pictures, physical distribution of the films, and the collection of the amounts due. The organization created for the proper performance of these functions is naturally extensive. Considering the character of the work to be done, however, it is not unduly complex. No better understanding of what is involved in the task of distributing pictures can be obtained than by describing the organization of a particular company. For this purpose the sales organization of the Pathe Exchange, Incorporated, as of 1929, may be cited. While it is true that this company was acquired in January, 1931, by the Radio-Keith-Orpheum Corporation, this transfer of control does not affect materially the value of this illustration for our present purpose.
The Pathe Exchange, Incorporated, operated a national exchange system with branch offices, called exchanges, in 31 key cities of the United States. Foreign distribution was carried on by subsidiaries of the company, except in Canada, where Regal Films, Limited, distributed Pathe pictures. The offices of the sales department were located at the executive headquarters in New York City.
In addition to its own product, the company distributed films of other producing companies on a percentage arrangement, usually receiving 30% to 40% of the gross revenue.9 The company was also the largest American distributor of films of educational value to the nontheatrical market. The company's gross sales, in 1928, were approximately $18,000,000.
8 Including such a concern as Consolidated Film Industries, Incorporated.
9 The product of one outside producer was not commingled with that of another outside producer or with Pathe product, but was sold independently as individual pictures or as groups of a given series.