Celebrating 100 Years of Paramount

30 Apr, 2012 By: Doug Desjardins

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During its 100 years in the entertainment industry, Paramount has morphed from a New York City-based producer of silent films into a multibillion-dollar studio that could be considered the crown jewel of the Viacom media empire. In its birth year, 1912, Paramount generated $200,000 in box office receipts with a single film. This year, it’s expected to generate nearly $2 billion.

In the years since its debut, Paramount has developed a reputation as an innovator. It is the second-oldest studio in the world — formed just a few months after Universal — and was the first to build its own chain of theaters to provide a venue for its own films. Paramount was also one of the first studios to enter radio, through a deal with CBS in the 1920s, and the first to recognize the potential of television, partnering with TV pioneer DuMont Laboratories to open experimental TV stations in Chicago and Los Angeles in 1939.

The founder and driving force behind Paramount in its early years was Adolph Zukor. A Hungarian immigrant who made a small fortune in the New York City fur trade, Zukor got his start in the movie business in 1903 when he opened a nickelodeon, a precursor to modern-day movie theaters, in which customers paid to watch short-reel silent films. The success of his first operation prompted Zukor to team with fellow entrepreneur Marcus Loew, and they built a chain of nickelodeons stretching from Boston to Buffalo.

The pair launched the modern U.S. film industry in 1912 when they bought the U.S. distribution rights to a French film called Queen Elizabeth, which at 40 minutes long was an epic, compared with the typical two-minute short-reel movies. The film, starring stage legend Sarah Bernhardt, generated a surprising $200,000 in revenue in its U.S. tour of nickelodeons.

Fresh off his success with Queen Elizabeth, Zukor entered the film production business. He partnered with several Broadway stage producers to form a company called Famous Players and began producing films based on popular novels and plays. The company made its debut in 1913 with The Count of Monte Cristo and five other films, and the future Paramount Studios was in business.

Around the same time, another newcomer to movies decided to make a Western on location and dispatched his director to Arizona. Arriving in Flagstaff in mid-winter to find conditions too cold to film, the director continued west to California and sent a now-famous telegram to his boss back East:

“Flagstaff no good for our purposes and have proceeded to California. Want authority to rent a barn at a place called Hollywood for $75 a month. Cecil.”

Producer Jesse Lasky gave young director Cecil B. DeMille the green light to rent the barn and that’s where he filmed The Squaw Man, which became a hit for his Feature Play Co. Zukor, who traveled in the same circles as Lasky, saw The Squaw Man and liked the idea of being able to film outdoors year-round in a warm climate. So in 1916 he engineered a merger with Lasky to create the Famous Players-Lasky Corp., which became the first studio to mass-produce films in the silent era. It also made it the second studio to set up shop in Hollywood, arriving close on the heels of Universal Studios.
When it came time to name the studio, Zukor’s first choice was “Progressive Pictures” but the name was already taken. So he took the name of the distributor his new studio had acquired. Paramount Pictures Corporation was formed in 1914 by theater chain owner W.W. Hodkinson. Legend has it that Hodkinson thumbed through a New York City directory looking for catchy names and came across an apartment building called The Paramount. Hodkinson sketched the name on a piece of paper and added a drawing of a snow-covered mountain peak, modeling it after a peak in the Wasatch Mountains in his home state of Utah. The familiar rocky peak and its ring of stars have remained virtually unchanged for nearly a century.

By the early 1920s, Paramount was churning out 60 films a year and assembling a stable of top talent. It signed a young Italian actor named Rudolph Valentino to a contract and made him a star overnight in The Sheik. Convinced that star power is what brought in audiences, he added more top talent, such as Gloria Swanson, Douglas Fairbanks, John Barrymore and Mary Pickford, and signed them to contracts committing them to work for Paramount, establishing a cornerstone of the old studio system.

But Zukor also recognized the need to make quality films, and for that he hired DeMille, who already was one of the industry’s top directors with a reputation for big-budget spectacles, including 1926’s The Ten Commandments (DeMille would remain with the studio for nearly 40 years).

That same year, Zukor realized the studio had outgrown “the barn” DeMille had rented in 1914 and still called home. He bought a parcel of land on Melrose Avenue and built the studio lot that still exists today, the only major studio still located near the old “Gower Gulch” area of Hollywood where the industry was born.

Paramount was the dominant studio during the Silent Era, and the 1927 film Wings won the very first Academy Award for best picture (incidentally, Wings had never been available on disc until this past January). But that didn’t stop Zukor from moving quickly into sound films, especially after Warner Bros. scored a hit with The Jazz Singer.

During the 1920s, Paramount also became the first studio to buy and operate its own chain of theaters, guaranteeing a venue for all its movies and generating ancillary revenue through ticket sales.

After the stock market crash of 1929 and the start of the Great Depression, Paramount shifted its focus to comedies. It launched the career of Mae West in 1932 with Night After Night, produced the Marx Brothers classic Coconuts and signed a former vaudeville showman named W.C. Fields to a movie contract. It also launched the film career of singer Bing Crosby and paired him with Bob Hope in what would become a franchise of “Road” movies starting in 1940.
Like nearly every studio, Paramount was hit hard by the stock market crash and was forced to reorganize in 1935. During the process, Zukor stepped down as president and appointed second-in-command Barney Balaban as his replacement (Zukor remained chairman).

During the 1940s, Paramount returned to more serious subject matter and produced critical and commercially successful films such as The Lost Weekend, For Whom the Bell Tolls and Double Indemnity. It also found a new star director in Billy Wilder, who ended the decade with the self-referential Sunset Boulevard, about an aging silent star. The movie showcased the now-iconic Paramount Studios gate and one of its first stars, Gloria Swanson. For most of the 1940s, Paramount reigned as Hollywood’s top studio.

The late 1940s marked the start of a slow decline for a studio that had experienced nearly unbridled success for three decades. The key event was a 1948 federal antitrust ruling that forced Paramount to sell off its theater chain, which was a major blow. In addition to eliminating more than 1,000 theaters that were sure to showcase its pictures, it cut off ticket sales revenue that was a primary source of funding for movie production.

Using the influx of cash from the sale of its theaters, Paramount continued to produce serious films in the early 1950s with director George Stevens (A Place in the Sun and Shane) but shifted its focus to comedies starring Jerry Lewis and Dean Martin, and musicals showcasing new teen idol Elvis Presley. By the end of the decade, Paramount was short on cash and producing mostly low-budget films.

The decline continued and by the mid-1960s Paramount was in dire straits. It hadn’t produced a hit film since Alfred Hitchcock’s Psycho in 1960, and Hitchcock had since jumped ship to Universal. In 1964, it decided to gamble on a big-budget epic called The Fall of the Roman Empire with star Sophia Loren and top-tier director Anthony Mann. The movie bombed and pushed the studio further into debt.

The Gulf + Western Years

In 1966, Paramount experienced its first major changing of the guard when it was purchased by Gulf + Western for $165 million. New owner Charlie Bludhorn decided to shake things up by making former actor and fledgling producer Bob Evans head of production, a move many industry insiders considered a recipe for disaster.

Despite his lack of experience in the movie industry, Bludhorn had an eye for talent, and Paramount began to rebound in the late 1960s. It scored hits with The Odd Couple in 1968 and True Grit in 1969, and set a new studio box office record of $100 million in 1970 with Love Story. Paramount capped its revival two years later with its mega-hit The Godfather. The studio also purchased Desilu Studios from Lucille Ball in 1967 and began to make inroads into TV production.

In the 1970s, Paramount began to merge its interests in television and movies. It hired TV executive Barry Diller to head the studio in 1976, and Diller brought along a team of executives that included Michael Eisner, Jeffrey Katzenberg and Dawn Steel. Looking to capitalize on the popularity of hit TV shows, the studio gave sitcom star John Travolta his film debut in Saturday Night Fever and followed with Grease. Both turned out to be massive hits. Paramount also revived the “Star Trek” TV series with Star Trek: The Motion Picture in 1979, a move that re-ignited the franchise. The film sequels and multiple TV spinoffs that followed would make “Star Trek” the studio’s most valuable property.

The 1980s heralded the age of “high-concept” films, and Paramount had some of the biggest hits of the era with An Officer and a Gentleman, Beverly Hills Cop and Top Gun, which started a long and profitable association with star Tom Cruise that would lead to the “Mission: Impossible” franchise. But when the team of Eisner and Diller left Paramount in the mid-1980s, replaced by Frank Mancusco, the studio shifted gears to focus on more thoughtful actioners such as The Hunt for Red October and dramas such as Ghost.

Things began to change in the mid-1980s. Bludhorn died of a heart attack in 1983, and Diller left the company in 1984. Bludhorn successor Martin Davis sold off most of Gulf + Western’s peripheral operations, purchased a chain of theme parks and renamed the company Paramount Communications in 1989, preparing the studio for a merger.

The Viacom Era

In 1993 entertainment giant Viacom made a bid for Paramount but was challenged by QVC and former studio chief Barry Diller. After the bidding war ended, Viacom came out on top and bought Paramount for $9.5 billion. Under new ownership, Jonathan Dolgen was installed as chairman and Sherry Lansing as president. The pair would lead Paramount to a new era of dominance in the late 1990s. During a four-year period, Paramount earned three Best Picture Oscars with Braveheart, Forrest Gump and Titanic.

In 2005, Viacom split into two divisions that separated CBS and Paramount. Under the split, the new Viacom included Paramount, VH1, Nickelodeon and other profitable cable TV channels. The same year, the company agreed to purchase DreamWorks SKG for $1.6 billion.

Aptly enough, Paramount entered its 100th year as the top studio in Hollywood, generating nearly $2 billion in revenue in the United States in 2011 and $3.2 billion overseas, led by Transformers: Dark of the Moon, Thor and Captain America: The First Avenger. In 2012 Paramount will continue to churn out hits with a lineup that includes One Shot with Tom Cruise, Rise of the Guardians with Chris Pine and Hugh Jackman, and a strong list of sequels including Paranormal Activity 4, Madagascar 3 and G.I. Joe: Retaliation.

And for movie fans, Paramount has created a new way to check out the studio’s history online. The “Paramount Pictures 100 Years of Movie Magic App” for the iPad allows users to watch a history of the studio, take a studio tour and watch clips of classic Paramount films on their iPad.

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