How the patent office almost shut down Hollywood
New book 'The Master Switch' examines the role of the patent office and the history of film – including how Thomas Edison tried to have a movie monopoly.
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One man, Carl Laemmle, challenged the trust and became an “Independent,” and tried to enlist others to fight the “film octopus.” Eventually the response to the patent-wielding Film Trust led Laemmle and Wilhelm Fuchs (later Fox) to form their own studies (now Universal Studios and Fox Features). “Thus the Hollywood studio was born, not out of choice, let alone glamour, but of brutal necessity.” So here we see the distorting and monopolizing effects the patent system itself had on the movie industry and Hollywood itself.Skip to next paragraph
This is the institutional blog of the Ludwig von Mises Institute and many of its affiliated writers and scholars commenting on economic affairs of the day.
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A recent article by Thaddeus Russell, 7 Ways the Mafia Made the U.S. a Better Place: ‘Renegade History’, contains further fascinating background on this episode:
Soon after he invented the motion picture camera and projector, Thomas Edison formed his own movie production and distribution company. In 1908, Edison joined with nine other film companies to form the Motion Picture Patents Company, a monopoly that attempted to control the making, distribution, and showing of all movies in the United States. Edison and “The Trust” pledged to make only movies that promoted wholesome, Christian, and “American” values. But on the Lower East Side, a group of entrepreneurial Jewish immigrants used Edison’s inventions to produce and screen their own films, which were shown in thousands of nickelodeons – five-cent movie theaters – in working-class neighborhoods all over the country. These “outlaw” filmmakers started out as vaudeville and burlesque promoters, and many of their movies were sexier, more violent, and far more entertaining than the bland fare put out by the Edison monopoly.
The great inventor was furious that “Jewish profiteers” were stealing his patent, getting rich from it, and using it to spread “smut” across America. So too were law enforcement officials. In 1907 a judge in Chicago wrote that the nickelodeons “caused, indirectly or directly, more juvenile crime coming into my court than all other causes combined.” Shortly thereafter the Chicago city council passed an ordinance granting power to the chief of police to censor motion pictures played in the city. In New York in 1907, soon after the police commissioner recommended that nickel shows be wiped out entirely, Mayor George McClellan was so moved by the evidence of immoral motion pictures polluting the minds of his citizens that on Christmas Day he ordered that all of the illicit motion picture houses be shut down.