The Power of Vertical Integration

Film studios began gaining power due to vertical integration by controlling the production of large quantities of films, distribution, and exhibition of films in almost every theater. Vertical integration was effective in that it helped give film studios control of every aspect of the studio by taking all the jobs and putting them under one company which allowed for vast savings for the company because they did not have to deal with other companies in producing a film. Having control over exhibition and distribution was where the studios received the majority of their power. They strategically organized their ownership of theaters to control the entire domestic market by organizing deals with independent theaters through distributing numerous quality films that were necessary to keep their theaters full.

Stars played a large role in the “immense power” of the film studios. Because the stars are what brought many movie –goers into the theaters, the stars were a large part of the studio system that film studios had to gain control of. The major film studios discovered and manufactured stars and took legal control of their identity. This was done through contracts that gave studios the right to exploit their image and cast them in their film studio’s movies. The stars were profitable for studios because they brought in the revenues from their films as well as the agents and publicists that work for them.

However, when a star became more popular, they were able to demand increases in their salaries. In this sense, stars were able to exert their own power. Shirley Temple is a good example of how a star can affect a whole society as was seen in the Depression Era when she was the symbol of faith and love which replaced the social and economic plight of the time. In the film industry, if stars felt as though they were being taken advantage of, they were able to threaten to break their contract or even go to the courts in order to plead their case. Usually the top stars were able to renegotiate their contracts to their wishes but some individuals would break their contract with their studio. For these individuals, it would be difficult to work in the film industry again because studios may be reluctant to hire someone that is stubborn and willing to take their complaints to court.

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