The Rise of the Moguls: The Men Who Built Hollywood | Historical Documentary | Lucasfilm

Hollywood in the 1930s....

To the outside world, this corner of southern California seemed like a magic place.

Here, the sun was always shining, everyone had a swimming pool,

and glamorous people earned enormous salaries working in factories called movie studios.

What the studio system really gave us were dreams.

It’s a bit of a cliché now, but they were literally dream factories.

From Hollywood’s beginnings in the nineteen-teens,

the films produced in its studios dominated the world’s movie screens.

Every year millions of fans bought tickets to see the studios’ latest releases.

And thousands of ambitious men and women lined up at their gates to find a job within their walls.

The studio system brought in writers and directors and performers and cinematographers and costume people.

And they became Meccas of talent.

But no one traveled farther to get here, or worked harder to get to the top,

than the men who built the studios and ruled them like feudal overlords.

Men who started out with nothing, and transformed themselves into Hollywood’s movie Moguls.

They were the pioneers, there’s no question.

These were the guys who built the industry and who really had the vision

for what movies could be as a business.

A business that reached its zenith in the Hollywood studio system the moguls built.

When Thomas Edison first introduced Americans to motion pictures in the early 1890s,

it was literally hard to imagine they would ever be big.

They were usually about 90 seconds long and originally they exhibited them

in a machine they called the kinetoscope where you actually had a little peephole,

you looked in the peephole and you saw the frame

the same size as the frame that went through the camera so it was quite small.

Movies started getting bigger in 1896,

when two French brothers named Auguste and Louis Lumiere came up with a way to project them onto a wall.

Back in America, Thomas Edison soon came up with a projector of his own.

And then movies began to be shown in theaters, in Vaudeville theaters, and projected on the big screen

and they became a little longer and became little skits and stories and so on

and that's how the movies began.

And how the movie business began.

Edison wasn’t just an inventor. He was an ambitious entrepreneur.

During the beginnings of the film industry, Thomas Edison dominated the production of these films,

he dominated the distribution of these films, and he also dominated the technology of the films.

He invented the cameras and the projection equipment that was necessary

and he took out patents on those things.

So indeed the first motion pictures, at least in this country, if you wanted to make a movie,

you had to use his equipment. You had to rent it or you had to buy it.

To make sure these rival filmmakers paid up, Edison set up a company in December 1908 to protect his rights.

He called it The Motion Pictures Patent Company.

Then he invited a few of his top competitors to join him in his new venture

if they agreed to his terms.

Together they would control the rest.

This became what was known as the Edison Trust.

And there were nine companies that banded together and in essence what they did was formed a monopoly.

And basically they said to anybody else who wanted to get into the motion picture business,

if you want to do that, you’ve got to get by us.

But while Edison was busy setting up his trust and trying to collect his royalties,

new men, with a new vision of what the motion picture business could be,

were making plans of their own.

The men who really had the vision about what motion pictures could do

were by and large a half dozen, maybe a dozen, for the most part Jewish, immigrants,

first generation Jews who had been in this country barely a decade or two.

And they were the ones who really picked up the ball and ran with it. And they ran a long way with it.

There was Carl Laemmle in Chicago, William Fox, Adolph Zukor and Sam Goldfish in New York,

Louis B. Mayer in Boston, and the Warner Brothers in Pittsburgh.

They all had almost identical backgrounds.

One day I literally put pins in a map where each of them had come from.

And they all grew up within a 500-mile radius of each other in Eastern Europe.

Poland, Germany, what is Lithuania, Russia and they all came to this country within five or 10 years of each other.

They were of course looking to take advantage of the American dream,

to find a business where they could make a lot of money

and in a short period of time gain a lot of power and respect.

Most of them started out in trades long open to Jews.

Adolph Zukor became a furrier, William Fox a tailor, Sam Goldfish sold gloves.

But these future moguls hadn’t come to America to recreate the lives they had fled in Europe’s Jewish ghettoes.

I don’t think these men were necessarily running away from their Jewishness.

I think they were looking for the greatest possible opportunities.

What most of the European Jews had heard about America was here was a place

in which anybody could go and start from scratch.

You could literally reinvent yourself.

But reinventing themselves wasn’t always as easy as these new Americans had imagined.

The anti-Semitism they had fled back home awaited them in America too.

Anti-Semitism definitely played a major role in the development of movies in America

because in fact a lot of Jews found that there were all sorts of doors closed to them

in more established kinds of businesses.

So they kind of had to look at marginal businesses

and one of those marginal businesses in it’s early days was certainly the movies.

The easiest way to break into the movies was as an exhibitor,

the businessman who bought or rented the movies men like Edison produced,

put them on the screen, and convinced the public to put down good money to see them.

In a way, it’s as though all these men were struck by a lightning bolt.

They all had the same idea at the same time because I think they saw,

“here is a brand-new potential industry, with constant cash flow.”

The thing they all saw was people standing in line to give their money to somebody else.

For a product they haven’t even seen yet. Well that’s kind of wonderful.

The audience for these films originally, of course, was the Vaudeville audience.

Vaudeville cost a quarter or 50 cents, which was a lot of money in those days.

Upper and middle class Americans could afford these high prices.

But immigrant entrepreneurs like Adolph Zukor were sure they could draw a broader audience into theaters,

and make more money, by charging less.

To find out how to do it, Zukor traveled to Pittsburgh to check out a new type of theater:

a converted pool hall in a working class neighborhood, where the ticket price was just a nickel.

It was called a Nickelodeon.

Soon, Zukor and the rest of the Moguls were building their own Nickelodeons

in immigrant and working class neighborhoods in Boston, New York, Pittsburgh, and Chicago.

And suddenly it became like a craze.

Journalists began to poke around and write articles with names like, you know, "nickel madness"

and would look at this and think, you know, what is going on here?

The guardians of America’s traditional values were taking their own look at the Nickelodeons,

at the people who crowded into them, and at the men with the odd names who owned them.

Various Protestant clergy groups were very worried about, in terms of values,

both what was on the screen, on the one hand, in which there would be sex and violence

or things of that nature, and also these Jewish entrepreneurs.

Edison and his partners in the trust began to worry that the Nickelodeons and their Jewish owners

were giving movies a bad name.

The trust told them to raise their ticket prices – or else.

They set the prices for what movies could cost when you saw it in a motion picture theatre.

They told theatres if you take films from other companies

you will not get our films. So it really was a cartel.

But the Nickelodeon owners feared their customers would refuse to pay more

for the mediocre films the trust was providing.

Edison was putting out a kind of a product,

which didn’t have any excitement to it or whatever,

and they were obliged to buy the package that Edison gave them.

The future moguls began to demand better movies.

Movies with narratives taken from novels and plays like those already being made in Europe.

And featuring the innovative techniques being developed by a few ambitious Americans

like Edwin S. Porter and D.W. Griffith.

The very first motion pictures were just a man kissing a woman or somebody sneezing.

The great train robbery gave us an actual story.

The stories then got more complicated.

Plays began to be translated to the screen.

Now with that, there’s a new film vocabulary.

Filmmakers like Griffith are saying I can create a different mood if I put the camera right up

to a person’s face or if I move back and show two or three people, or farther back and show a thousand people,

There’s a certain impact of that. They were experimenting with techniques like irising in

in which like the iris of an eye, it would sort of make a little revolution.

Or black out or fade out, move the camera in a certain direction.

These more complicated, longer films became known as featured presentations, or features.

But when Nickelodeon owners like Adolph Zukor and Carl Laemmle asked the Edison trust to make them,

the trust said no.

The Edison trust would only make one- or two-reel films, 10 or 20-minute movies.

You have to remember in these early days it was all new, they were trying things out.

They thought my God if you make a movie more than 20 minutes you will put people to sleep

and they’ll never come back to another movie.

So just give them a quick thing and next week they’ll have something else to come back to.

The future moguls realized that if they wanted feature films, they would have to make them themselves.

It was people like Samuel Goldfish, like Zukor, like Laemmle, who realized,

no if you give people a good story, they will follow it as long as the story is engaging.

Even if it goes an hour, even if it goes an hour and a half, let’s do it,

let’s basically put great drama up on the screen and show the trust how foolish they are.

Carl Laemmle, who owned a chain of nickelodeons in Chicago, led the way.

By 1912, Carl Laemmle of the Laemmle Film Service, couldn’t stand this any longer

and he formed another group, a group of independents

that would then pool their money together and make their own films.

The trust demanded that Laemmle and the rest of the independents

pay royalties for the use of Edison’s patented motion picture technology.

But the future moguls refused to pay.

They felt that there was no patent on certain cameras they got from Europe, for example.

So Edison started to sue these people.

And if the threat of a lawsuit didn’t do the trick, Edison and his partners were ready to play rough.

All these little independents were being harassed by Edison.

It was called the patents war. And it actually turned into a war

because in 1912 there were actual goon squads sent to take over laboratories or studio facilities

and others had their goons and they were fighting with the axe handles and we’re talking real violence here.

We’re talking a real war.

To get away from the trust and its goons, Laemmle and the rest of the independents

tried shooting their films in places like Florida, or Cuba.

Or Flagstaff, Arizona.

In 1913, first-time independent producers Jesse L. Lasky and Sam Goldfish

sent first-time director Cecil B. De Mille to Flagstaff

to make a feature-length western called The Squaw Man.

But things didn’t turn out quite the way they planned.

DeMille gets off the train, looks around, he’s got a few actors with him,

he’s got his cameraman and so forth, looks around, and says,

“boy, this doesn’t really look like the west,” as he had envisioned it.

So he got back on the train and they went to the end of the line and the end of the line was Los Angeles.

And a few days later, he sent a telegram back to the home office, back to Sam Goldfish in New York City

that said, “Flagstaff no good for our purposes, have rented a barn in a place called Hollywood.”

This little suburb of Los Angeles would never be the same.

De Mille wasn’t the first filmmaker to find his way to California.

Others had passed through to shoot location footage or set up small west coast operations.

In 1910, the great D.W. Griffith had directed the first film in Hollywood:

a 17-minute short called “In Old California.”

But Squaw Man would be the first feature film made there.

It wouldn’t be the last.

Los Angeles, Hollywood was an ideal place to make motion pictures.

First of all, it had sunlight most days of the year, so you could film indoors, outdoors.

Also, in Los Angeles, you could travel two hours in any direction and you would have completely different scenery.

You could have the ocean on one hand. You could have snow on the other.

You could have the desert in another direction.

And above all, in those early days, you were far from the trust.

It took a lot of time, money, effort to send a goon squad all the way out to California

and try to find a little troop of some vagabond actors and filmmakers.

But just as De Mille’s cameras started to roll on The Squaw Man,

the patent war that had forced Goldfish to send him west in the first place

was coming to an end.

In 1915, the United States Supreme Court ruled that Edison and his partners

had violated the Sherman Anti-Trust act.

The Court imposed a stiff penalty and ordered them to split up the trust.

But by 1915 they had also been defeated by their opponents, the independents.

The independents had in a sense outpaced them,

had really taken over the industry even without the court decision.

So if you go back and you look at the companies that were

part of the trust, they basically went out of business.

Finally free of the Trust and its restrictions,

the future moguls were eager to make a fresh start.

They left the cold gray cities of the east coast,

and headed west to the filmmaking promised land de Mille had discovered in sunny California.

In 1915, William Fox set up a little studio in Hollywood

that would become a giant as Twentieth Century Fox,

and Carl Laemmle opened Universal Studios just over the hill in the San Fernando Valley.

In 1916, Sam Goldfish and Adolph Zukor opened Paramount Pictures.

A few years later Goldfish – who had already changed his name from Schmuel Gelbfisz –

would change it again to Samuel Goldwyn,

and create one of the studios that would become Metro-Goldwyn-Mayer.

Louis B. Mayer, who would run MGM for decades,

moved into his first studio in 1918.

The Warner Brothers began production in theirs the same year.

But the moguls didn’t have Hollywood to themselves.

By the early 1920s, this once-bucolic corner of Southern California was getting crowded.

In those early decades of motion picture business,

there were hundreds of film studios.

I mean hundreds of them. Mom and Pop studios open on every street corner, especially out in Hollywood.

But only a few survived.

I always think of early Hollywood, the teens and the twenties,

as that game of musical chairs in which you play the music and the children walk around the chairs,

and the music stops and you have to sit down, but each time, one chair is taken away.

To win this game the moguls had to stay in front of the pack.

To do it, they would have to make films the public would pay to see.

Fortunately, their early careers had helped to prepare them for this challenge.

They all had a feel of the cloth.

They had a sense of hands on, of being involved in a craft in a way.

More important, they had a sense of the retail business

and they knew that fashions change.

They knew that you couldn’t sell the same product year in, year out,

that you had to follow trends. You had to smell what was out there. You had to see what people were buying.

You had to see how they wanted to dress and what they wanted to listen to.

But to succeed in this business they had to do more than make films the public wanted to see.

They had to do it as efficiently as possible.

The setting up of the studio system went hand in hand

with the kind of industrial practices that you had developing

in America in the first quarter of the 20th century.

The ultimate example of that was of course Henry Ford and his plants

and the way that he streamlined everything and put everything together so that

when those cars came out he could sell them at a price that people could afford

and that’s exactly what the people who ran the big studios were looking to do.

The workers in the moguls’ factories weren’t riveters, engineers, or welders.

They were cameramen, editors, costume designers, and movie stars.

The merchandise rolling off their assembly line was made of celluloid, not steel.

But the moguls and their fellow industrialists had a common goal.

To create a quality product as efficiently and as cheaply as they could.

And the studio people could make money at the end of the road. That was of course the ultimate objective.

But the Moguls knew from their days running the Nickelodeons

that there was money to be made in other parts of the movie business too.

You know at a certain point, these moguls, being just good businessmen, realized okay,

I can make money by sending my films off to theaters who then

collect money and they pay us to rent the films.

But wait a minute. What if we actually owned the theaters ourselves?

Then we could take that money, as well. And what if we’re the middle man who distributes it?

Well we could take that money, as well. And so all these major studios

became also exhibitors and distributors for themselves,

basically, so they could eat the whole pie,

and that’s what they were doing for many, many years.

By 1921, Adolph Zukor’s Paramount Pictures owned over 300

first run movie theaters across the United States.

MGM and Fox weren’t far behind.

And these weren’t the shabby storefront Nickelodeons the moguls started out in.

These were movie palaces.

Across America, these fabulous buildings not only drew people to the movies,

they came to stand for the glamour and appeal of Hollywood itself.

The Hollywood the Moguls had built.

By the early 30’s Hollywood was definitely there, the kind of outline

of seven or eight major companies that would dominate the business

was in place and would be there from then until now.

The fact that the moguls basically controlled every aspect of the industry

really kept them potent throughout good times or bad times.

It could pull them through the depressions, it could pull them through wars,

because basically, they controlled the entire market in every way.

That control also gave the moguls a freedom their ancestors could only dream of.

In their Hollywood, there was no one to tell them what kind of movies to make,

or where to show them.

And best of all, there was no one to tell them they were second-class citizens,

just because they were Jews.

The moguls, and make no mistake about it, in addition to overnight

being the wealthiest people in America, I mean famously, Louis B. Mayer

was the highest paid man in the Unites States of America,

but as much as the money meant to them, they loved the power, too.

They came out here and they could make up all the rules because it was all brand new.

Anything they wanted to do went.

It was very interesting to me when I was researching the life of Samuel Goldwyn

that I learned that he, like most of the other moguls, rented a beach house out in Santa Monica.

And indeed, all of Hollywood, all the moguls, gravitated to this one strip of beach.

Each of these moguls, just 25 years earlier,

had grown up on the streets of eastern Europe, could barely eat, literally wearing rags.

And now here they all were, half a world away,

living this dream, all next door to each other in one of the most beautiful beaches in the world,

more money than they knew how to spend.

I mean they had riches and things they could buy that they didn’t know existed.

I keep going back to this idea of the American dream.

These moguls dreamed it, lived it, and manufactured it.