Studio system

The studio system (which was used during a period known as the Golden Age of Hollywood) is a method of film production and distribution dominated by a small number of "major" studios in Hollywood. Although the term is still used today as a reference to the systems and output of the major studios, historically the term refers to the practice of large motion picture studios between the 1920s and 1960s of (a) producing movies primarily on their own filmmaking lots with creative personnel under often long-term contract, and (b) dominating exhibition through vertical integration, i.e., the ownership or effective control of distributors and exhibition, guaranteeing additional sales of films through manipulative booking techniques such as block booking.

The studio system was challenged under the anti-trust laws in a 1948 Supreme Court ruling which sought to separate production from the distribution and exhibition and ended such practices, thereby hastening the end of the studio system. By 1954, with television competing for audience and the last of the operational links between a major production studio and theater chain broken, the historic era of the studio system was over.

The period stretching from the introduction of sound to the beginning of the demise of the studio system, 1927/29–1948/1949, is referred to by some film historians as the Golden Age of Hollywood. The Golden Age is a purely technical distinction and not to be confused with the style in film criticism known as Classical Hollywood cinema, a style of American film which developed from 1917 to 1960 and characterizes it to this day.

During the so-called Golden Age, eight companies constituted the major studios that promulgated the Hollywood studio system. Of these eight, five were fully integrated conglomerates, combining ownership of a production studio, distribution division, and substantial theater chain, and contracting with performers and filmmaking personnel: Fox Film Corporation (later 20th Century-Fox), Loew’s Incorporated (owner of America's largest theater circuit and parent company to Metro-Goldwyn-Mayer), Paramount Pictures, RKO Radio Pictures, and Warner Bros. Two majors—Universal Pictures and Columbia Pictures—were similarly organized, though they never owned more than small theater circuits. The eighth of the Golden Age majors, United Artists, owned a few theaters and had access to two production facilities owned by members of its controlling partnership group, but it functioned primarily as a backer-distributor, loaning money to independent producers and releasing their films.

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