Variety (Oct 1945)

Wednesday, October S, 1945 PICTURES 16 NEW DOMESTIC BONANZA U.S. Distribs Eye British Pound Move For Effect on Exports and Receipts Speculation is rife among film in-i ' dustry leaders in this country whether Kngland is going to again freeze funds of American picture companies,, or whether that nation will continue to remit monies weekly as heretofore. Situation was brought about with the ending last Sunday (30) of the paging of the British pound at $4.02, with the result , that value of that nation's money can either go up or down without much warning. The pound veals ago was worth $4.80 American and then slid to $4.02 where it has been pegged by govern- ment decree. It is recalled that for a number of months ill. 1942-43 U. S. company monies in England were iiczen and then, when lend-lease started, Arms were permitted to take out of Kngland only a percentage of their gross earnings based on monies taken out for the three years prior to the freezing order. Apparently several American film companies foresee less exporting of HoHyvvood pictures for distribution in England in the future. Hence the widespread move by the majors to strengthen their holdings in Great Britain, by making belter-quality' British product and sending over, to that country topflight stars to ap- pear in British-made films. A school of thought among several U, S. pic company foreign chiefs is that since England needs dollars to deal with American companies, that country will do less importing of foreign pix and more exporting of English prod- uct to America, thus building up dollar credit. On the other hand, the entire situ- ation may be stabilized by the loan that is currently being discussed for England, reports indicating that a loan of $5,080,000,000 will be made by U S, The loan will probably be lor a long period of time, and re- newed after that date, too. at a negligible rate of interest. Purpose, of course, is to,givc the British dollar balances to do business with U, S. industry. After all, England represents al- moM two-thirds of the total foreign business done by American ph'tttic companies. If funds should be blocked for any length of time, the panics too much, since roicigii actually represents the difference be- tween a small profit on their product and big profit. But indie producers will definitely be affected since the monies taken in on foreign distribu- tion of their pictures might well rep- resent the welfare of their entire organization. Pix Divvy* Still Up Washington. Oct. 2. Film industry dividends are still running at a better rate than in 1944, according to the. latest Commerce Department figures. The cut for August was $500,- 000, compared with $300,000 for the same month last year. -For the three months ending Aug. 31°, the cut for picture industry stockholders amounted to $5,- 800,000, which was $600,000 more than for the same period in 1944. . Ferber Yarn 1st For Todd at U Edna Fcrber's "Great Son;" in Technicolor, will be Mike Todd's first film production for Universal under a new four-year deal signed be- tween the Broadway legit producer and U prexy Nate Blumberg before the latter sailed for London. It's Todd's debut as a picture-maker but his indie unit deal (a la Waller Wanger and Mark Hellinger. also now on the U lot) does not limit.his Broadway legit activities. Todd, must make his picture next, summer. The Ferber property has been held in (Continued on page 29V IN ON HOME BIZ , By FRED STENGEL : An entirely new facet of film dis- tribution, which will evolve itself in- to a multi-million-dollar business be- fore many months have passed, has opened up for the major companies! This is the selling of 16mm. prints o£ entertainment pictures to U. S. exhibitors in conjunction with the present sale of 35mm, pictures. Basis for this overall plan, which began recently in connection with foreign distribution of Hollywood pictures, is the experience of the aimed forces during the war just ended. Army and Navy showed dis- tribs what could be done with lGmm prints and projection equipment, also bringing out the fact that there is now a ready-made market for this type product among the millions of servicemen and women who were entertained and educated by films .shown solely in 16mm. throughout the world. It has been established that many of the majors, including Metro, RKO, Paramount 20th-FOx and Warners plan to do away^ith the several in- dependent distributors to whom they (Continued on page 20) Ruling by Treasury Dept. on Capital Gains Taxes May K.O. Indie Producers Passportitis Almost every top exec in the film business has his passport now, or has applied for it. All have the urge for a look- see, abroad. As. "essential busi- ness," the State Dept. now okays passports and the British grant visas, to U. S, businessmen. No visa necessary for France. LOEWS WHN MAY SELL TIME FORMERLY M-G'S Warner Bros, may buy the radio spots on WHN. New York-, which Loew-Metro is relinquishing. Odd part of the deal is that Loew's owns the radio station but is easing | ent off on its radio advertising, hence ' the availability of the time to WB. N. Y. VARIETY CLUB UP AGAIN A new move is afoot looking to the organization of a Variety club in N. Y. City, where, it is felt in tent circles one should have been set up long ago. Divorcement Gets Glad Eye From Pic Indies; Theatre Need With more and more film showmen eyeing the independent film produc- tion futttre.. with its capital-gains \ possibilities, all are looking to the possible effects of the Government's anti-trust suit, which starts in New York next Monday (8), as giv- ing, it further impetus. In short, should theatres be severed from the so-called "Big 5" producer-distribu- tors, it is expected to open up new channels for indie picture product. That's what the Society of Indepcnd- Motion Picture Producers hopes for. also. In line , with this theory, some wonder if Joe Bernhard wasn't in- fluenced b.v that when he resigned | his WB vice-presidency as head of j the large Warner Bros, chain of i theatres. . '.'. ] Anybody with indie pix product, it | is expected, will have a better ' (Continued on page 29 °> SAG Seeks Probe Of'Unfair Taxes Hollywood, Oct. 2. Screen Actors Guild is demanding an investigation of "income and Other tax Jaws as they discriminate against actors." Question has already been discussed with Treasury Sec. Fred Vinson and Eric Johnston, new chief of the MPPDA. One of the complaints is that the proposed reciprocal tax agreement between the U. S. and Great Britain contains a clause specifying that the agreement applies to everybody but actors and artistes. Guild pointed out that a film star might earn $150,000 annually for a few years during his heyday but that his average annual earnings, when spread out over his whole ca- reer, may average $4,000 or less. Announcement of the Guild's cam- I paign tor a revision of taxation got a rousing welcome from 1,000 thesps I who attended the meeting. ODEON (RANK) VS. PAR CUE TO CAN. PRICE WAR? Showmen foresee a price-cutting war in Canada, even if J. Arthur Rank's Odeon circuit only consum- mates 50"; of its now well-publi- cized plans for new theatre building. Since it will be Famous Players- Canadian Corp's.first real competi- tion in the key spots, the Dominion's indie exhibitors figure they will be forced to price-cutting to meet the battle of the titans, with their choice of product housed' in modern de- 1 luxers. EXPECT KALMINE NAMED BERNHARDT SUCCESSOR It is expected that when Hai ry M. Warner arrives from Hollywood in New York hi a couple of weeks he will formally name Harry Kalniine the general manager of WB theatres. Right now, as asst. g.m.. he is run- ning the chain, with Joe Bernhard's resignation. Latter left for Hollywood yester- day (Tues.), where he will continue Plans for his indie film-producing "nit, via WB release, called U. S. Film Corp., of which Bernard'. is President and ex-Marine Cap!. Mil- ton Sperling is vecpec and produc- tion head.. :' ■ V/ Lem Jones, Willkie's Sec, Gen'l Aide to Skouras The late Wendell Willkie's former secretary; Lem Jones, is now con- fidential secretary and general aide to prexy Spyros Skouras, of 20th- Fox. Willkie was board chairman °f the same film companv at the time °i his death. With Jones' activity. Sam Shain. who for a time aided Skouras. re- turns to more directly head the trade press division of the company's Pub-ad staff. arfy-JLme Is there a British film party-line already starting to work? Even before if. Arthur Rank has carried England's figurative cinematic foot- Ball over the goal-line? The U. S. film industry may well start to wonder about it. As witness two aspects. Firstly, that blast at Warner Bros.' "Objective Burma," which literally chased the film not only off the Warner theatre (London i screen, after only one week's engagement,' but chased it out of the country. Anyway, at least 500 bookings in as many theatres of the Associated British circuit were cancelled. The other aspect is that curious article in the N. Y. Times magazine section Sunday, Sept. 23, by Dudley Carew in which the British ob- server took Hollywood apart on a number of points. Last Sunday (30 > Bosley Crowthcr de- fended Hollywood, accenting that the trend, despite lapses, is toward better pictures and better taste. "Mrs. Miniver's" exaggerated sen- timental make-believe: Hollywood's alleged self-admiration in "Hollywood Canteen"; Chap- lin's "Dictator" and "The War Against Mrs, Hadley" were among other American films dep- recated by critic Carew for one reason or an- other, • Both the captious Englishman 1 and the re- butting American overlook completely that Hollywood has produced the best British pic- tures. "Cavalcade" sums it up. In fact, the extraordinary emphasis currently in England against Warners' "Objective Burma'' is focused just as much against its star, Errol Flynn, for haying "failed to contribute to Britain's aid during the Isle's greatest moments" during the war. One British press comment was that "we've come to expect to see the true laces of men going into battle. We've come not to sec Errol Flynn, dressed up as a paratrooper, gal- lantly leading his men . " From the Hollywood production front, and for a long time from the American film-fan view- point, the same attitude was voiced about the strong British influence in the U. S. pix, but being the liberal art form that it is, there is no room for such chauvinistic thoughts at the pro- duction source or in the consumers' market. The glory that is Britain's has provided a wealth of basic historical material for cinematic glorification, whether made in Hollywood or Elstree. It's historically unfortunate, of course, that Warners slighted the British 14th Army in the cinematic saga dealing with the Burma cam- paign of World War II. But it seems strange that this should be sufficient to actually force cancellation of an American movie in London for political reasons. Our alliance with Britain should transcend such celluloid sensitivities. Lacking that, hence the query' whether Eng- land's postwar cinematic ambitions aren't some- how tied in with these recent manifestations. Fortune mag for October points to Rank as. England's "movie missionary." England thrives on its export markets. Traditionally astute in international diplomacy—some of Britain's mis- •cues in that direction in recent sears notwith- standing—it's now an open secret that England is backing Rank for a primary and basic pur- pose—trade. It's long since axiomatic that commerce follows the., movies, and that Holly- wood's mirroring of the American moods, modes and manners has been a potent force in Amer- ica's international business relations. The Germans and the Russians were quick to per- ceive that, but the British are now in best position to push that premise. Abel. Hollywood, Oct. 2. The anticipated ruling from the U, S. Treasury that capital gains of film corporations will be held as personal holding, corporations and subject to a tax of 85% instead of the current 25% capital gain tax, may be a knockout blow to such cor- porate structures. A quick scan by attorneys and accountants to seek a possible loophole reveals that the only method Of keeping such cor- porations in the 25% bracket will be if there are more than five bona- flde stockholders. If corporation is short of that number, anticipated ruling will hike tax nick to heights. Treasury regulation on personal holding companies.places a 75% tax ' on incomes up to $2,000. Over $2,000, the tax is $1,500 plus 85% on excess over S2.000. Such a tax nick would completely wipe out advantages now enjoyed by many film personalities who have been making pictures un- der capital gains regulation. In some instances, if the anticipated ruling governs the present tax year, it might mean total bankruptcy for a few independent producers or stars. ;'; ■'■..;' ■ Ah example of how deep the tax (Continued on page 22) FILM ATTACHE SETUP DENIED BY STATE DEPT. Washington, Oct. 2. Reports of a new film attache for the State Dept. were denied yester- day (IV by Francis Colt de Wolf, head of State's telecommunications division, and George Canty, his mo- tion picture specialist. . They said they knew of no such appointment coming up on cither a specific or regional basis. Such attaches are put on by em- bassies as specialists only on specific requests from industries, and the film industry has made no such re- quest. Telecommunications Division is the blanch of the State Dept. which handles negotiations with for- eign countries on commercial mo- tion picture matters. It now has two attaches on a regional basis, one in Europe and one in South America. However, they handle all the'busi- ness of the division, including radio and other matters, and have not Trado Mark Registered FOl'XDED BY SIMB SILVERMAN l'lll,ll»lieil IVeokl.t Iit VARIETY. ■■<•. yid Silverman, PreqJUent 134 HPcM 46lh St., New York 19. N. 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