Who invented movies?

have called William Wadsworth Hodkinson, "the Man Who Invented Hollywood" knowing that a more correct title would be — the Man Who Invented the Business of Hollywood. Remembered today as the founder of Paramount Pictures, W. W. Hodkinson's accomplishments would place him among those individuals who have had the deepest influence on the development of the movie industry. Practically single-handedly, W. W. Hodkinson changed the way movies were produced, distributed, and exhibited. His reforms during the early days of the film industry provided the prototype for all major Hollywood studios.

The Hodkinson system of distribution brought about the shift in power from the Edison Patents Trust, and facilitated the transformation that would eventually make Hollywood the center of American film activity. During the pre-studio era (before the fall of the Edison Trust in 1915), movie releases were generally handled in one of two ways—either by states rights or by road show. But the methods proved ineffective for wide-scale feature distribution. Though not technically a producer himself, Hodkinson was nevertheless a film visionary who revolutionized the business with a distribution masterstroke that became standard practice.

William Wadsworth Hodkinson opened his first film exchange in Ogden, Utah in 1907, at the age of 26. Within a few years he became Special Representative to the General Film Company representing the Motion Picture Patents Company in Salt Lake City and Los Angeles. He envisioned a nationwide distribution structure that would make states rights obsolete, and provide profit-sharing with producers to encourage filmmakers to concentrate on higher quality films that would yield higher box office.

The Hodkinson system was essentially distributor-financed film production. Under Hodkinson, the distributor would provide a cash advance to an independent producer to cover the costs of producing each feature film. The distributor then received the exclusive rights to the finished movie, using a network of exchanges to control distribution and marketing, and even offering to pay for the producer's film prints and advertising. Hodkinson kept 35 percent of the box office as a distribution fee, and gave the rest of the profits back to the producer. Hodkinson discovered that by financing film producers, the distributor was guaranteed a steady stream of high-class pictures without ever having to operate a film camera, while the producers themselves realized far more profit than they would under the states rights system. The Hodkinson distribution system proved so advantageous for all involved that, with slight modification, it has remained in full practice in Hollywood to this day.

Hodkinson Opposes the Patents Trust

In April 1911, Hodkinson began to implement his system by reorganizing the San Francisco area for General Film. The test market generated fantastic results, but in 1912 W. W. Hodkinson encountered resistance from the Trust which refused to enact his new procedure in other regions.

In November 1912 he made two comparative charts "predicting, in one chart what the future of the picture industry would be, especially that of General Film, if my methods were adopted nationally; and what would happen if they were not." He traveled to New York, for a frustrating encounter that extended until February. San Francisco representatives sent telegrams in favor of Hodkinson's reforms. He persuaded two leaders of the General Film Company, but his policy was refused by the Patents Company members as a whole.

During this trip to New York in late 1912, Hodkinson established ties with some of the important independents including Adolph Zukor, who was then struggling under the states rights method, and was the kind of producer who would benefit greatly by this new distribution procedure. In May 1913 the president of General Film, under pressure from the Trust members, rejected Hodkinson's proposal, and even asked him to undo his successful San Francisco reforms. Hodkinson declined "knowing that it would mean my dismissal from my position—which it did."

Hodkinson formed the Progressive Company, a west coast-based operation that distributed films for a number of independent production companies like the Famous Players Film Company (formed by Adolph Zukor in 1912) and the Jesse L. Lasky Feature Play Company (founded in 1913 by Lasky, his brother-in-law Samuel Goldfish, and first-time director Cecil B. DeMille).