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MCA, Seagram and Universal: the studios

The studios

This page considers the Universal Pictures, Studios USA and Revue studios - centrepieces of media groups assembled by MCA, Matsushita, Seagram and Vivendi.


It covers -

  • introduction
  • the Laemmle era
  • Universal-International
  • Universal Pictures
  • MCA and Revue
  • Matsushita
  • Seagram, Studios USA and Vivendi
  • studies

There are complementary profiles on Vivendi (which acqured Seagram) and Polygram, a major component of Universal's music arm.

Introduction

Universal dates from the second decade of US film production.

Ailing media and telecommunications conglomerate Vivendi Universal, profiled here, offloaded its US film, theme park and cable television interests to a joint venture with NBC-owner General Electric during 2003. That venture is called NBC Universal, with 80% held by GE and 20% by Vivendi. It includes the NBC broadcasting and cable television operations.

A chronology is here.

The Laemmle era

Universal Pictures was founded by Carl Laemmle (1867-1939) in 1912 as the Universal Film Manufacturing Company of New York. He'd opened a nickelodeon theater in Chicago during 1906 after migrating from Bavaria, subsequently building a nicelodeon chain and expanding into distribution.

During 1909, with support from several minor studios opposed to the Edison monopoly, he established the Independent Moving Picture Company of America (IMP). In 1911 IMP bought the Nestor Studio on the West Coast and five years later founded Universal Studios in Hollywood as the centre of a large-scale integrated production, distribution and exhibition operation.

As with most of the Hollywood studios, although Carl Sr was able to pass operational control to son Carl Laemmle Jr (1908-1979) in 1929, Universal was funded by 'East Coast money'. Investors ousted the younger Laemmle during the Depression, despite the success of classics such as James Whale's Frankenstein, with the group being sold to the Standard Capital Company.

Universal-International

For the following two decades Universal had a profile as a competent but not especially profitable factory for B grade and C grade films, such as Abbott and Costello comedies and the Deanna Durbin musicals.

In 1946 it merged with International Pictures as Universal-International (UIP) under the creative control of William Goetz and Leo Spitz.

Universal International was acquired by the Decca record company in 1952 as part of ownership changes following the 1949 ruling by the US Department of Justice about spin-off of exhibition operations.

MCA and Revue

Five years later MCA acquired Paramount's pre-1948 film library for US$50 million, subsequently proven to be a bargain as the new owners licenced films to US and overseas television stations.

MCA bought Universal's back lot for US$11 million in 1958, leasing the facility to Universal.

Four years later, amid increased competition and consolidation in the record industry, Decca sold Universal to MCA. The sale reflected MCA's interest in using Universal's production and distribution facilities, particularly for television production as an extension of its existing Revue Television Productions operation (responsible for video fodder such as Alfred Hitchcock Presents, Leave It to Beaver and Wagon Train.

As Universal Television it established a profile for law & order dramas (Dragnet, Columbo and Law & Order) and action series. Feature film involvement included Jaws and ET.

Matsushita

In 1990 MCA was acquired US$1.6 billion by Japan's Matsushita group, a counterpart of GE and Westinghouse (and a competitor of Sony). Matsushita - centred on Matsushita Electric Industrial Company - was best known as the parent of Panasonic electronics.

Acquisition reflected Matsushita's large cash flow (particularly from exporting consumer appliances to North America), the availability of cheap loans as a consequence of the 1980s Japanese property bubble and received wisdom that hardware manufacturers such as Sony and Matsushita had to expand downstream into content production.

Performance by MCA was underwhelming and Matsushita appears to have faced difficulties coming to grips with the 'creatives' in Los Angeles. In 1995 it accordingly offloaded a controlling stake MCA to Seagram for US$5.7 billion.

Seagram, Studios USA and Vivendi

As a way of gaining cash for Seagram's ambitious expansion plans (eg acquisition of Polygram for US$10.4 billion, following that group's purchase of Decca) and building alliances the Universal Television studios were spun off to Seagram's USA Networks subsidiary in 1998, being renamed Studios USA.

Vivendi - examined in a separate profile on this site - inherited Universal in 2000 when it acquired Seagram, reflecting that purchase by rebadging itself as Vivendi Universal. Two years later it bought back the USA Networks studio and cable television holdings (reinstating the Universal Television name).

Studies

Philip Dick's City of Dreams: The Making & Remaking of Universal Pictures (Uni Press of Kentucky 1997) is more substantial than Clive Hirschhorn's The Universal Story: The Complete History of the Studio (New York: Crown 1983), albeit without the latter's illustrations. Universal Horrors: The Studio's Classic Films, 1931-1946 (Jefferson: McFarland 1990) by Michael Brunas, John Brunas & Tom Weaver covers the monster flicks.

Context is provided in the essential Movies & Money: Financing the American Film Industry (Norwood: Ablex 1982) by Janet Wasko, The American Film Industry (Madison: Uni of Wisconsin Press 1985) edited by Tino Balio and The American Movie Industry: The Business of Motion Pictures (Carbondale: Southern Illinois Uni Press 1982) edited by Gorham Kindem. Douglas Gomery's superb The Hollywood Studio System (New York: St Martins 1986) and Thomas Schatz' The Genius of the System (New York: Simon & Schuster 1988) are invaluable for understanding production and distribution prior to the 1950s.

For Barry Diller see Jerome Tuccille's Barry Diller: The Life & Times of a Media Mogul (Secaucus: Carol 1998) and the thinner The Barry Diller Story: The Life & Times of America's Greatest Entertainment Mogul (New York: Wiley 1997) by George Mair.