Annual EBHS Conference, 39th Annual Economic and Business History Society Conference

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Hollywood studios, independent producers and international markets: globalisation and the US film industry c.1950-1965
Peter Miskell, Teng Li

Last modified: 2014-03-10

Abstract


The challenge facing multinational firms in developing global product lines that can appeal to consumers from diverse social and cultural backgrounds is an important issue for scholars of international business. The challenge is particularly acute in ‘cultural industries’ such as film – yet the global prominence of Hollywood producers and distributors would appear to suggest that it is one to which they have risen remarkably successfully.

This paper examines the internationalisation of Hollywood entertainment in the period c.1949-1965. Two observations are commonly made about the US motion picture industry in this period. The first is that the era witnessed the ‘disintegration’ of the studio system, with the major vertically integrated ‘studios’ forced to sell off their cinema chains and also becoming increasingly reliant on ‘independent’ producers to supply their product (Storper and Christopherson, 1987; Storper, 1989; Scott, 2002). The second is that the period saw US producers and distributors become increasingly reliant on foreign markets as a source of revenue (Guback, 1969; Scott, 2004; Waterman, 2005). This paper analyses the 665 films released internationally in this period by Warner Bros. and MGM, for which reliable financial data is available from surviving studio ledgers. It examines the foreign revenues earned by these films, and compares this with the ‘international orientation’ of the pictures themselves (an international orientation index is constructed on the basis of each film’s setting, characters, stars and other creative inputs). The paper finds that the growing importance of foreign markets for US distributors was reflected in the balance of their film portfolios, with an increasing proportion of films with a strong international orientation as the period progressed. The evidence also indicates that independent producers, rather than major studios themselves, were increasingly responsible for the production of this internationally oriented product. Finally, the paper examines the geographical locations where these internationally oriented films were set, and compares this with the international distribution of film revenues for the major studios. Certain national locations were clearly more commonly used as film settings than others, and such differences cannot be simply be explained by their relative value as film markets.