Chapter 34. Adolph Zukor: “The Public Is Never Wrong.”Jewish men made Hollywood: Carl Laemmle founded Universal; Louis B. Mayer, Marcus Loew and Samuel Goldwyn founded MGM; William Fox, nee Fuchs, founded Fox; Harry Cohn founded Columbia; and Adolph Zukor founded Paramount. All of them were Jewish. Even the brothers Warner were Jewish, as the family name was Wonskolaser back in Poland. Most of Hollywood's founders were immigrants. Long after they were dead, Neal Gabler wrote the classic, “An Empire of Their Own: How the Jews Invented Hollywood."
They did a good job too. Adolph Zukor was the embodiment of these movie moguls, rising from poverty to great riches by working hard, taking chances, and battling for artistic freedom, because to get to Hollywood, Zukor first had to defeat a powerful cinematic cartel, headed by Thomas Alva Edison, which used patents to control the American film industry in its early days.
Born in Ricse, Hungary, on January 7, 1873, Zukor was orphaned at an early age and raised by an uncle who was a rabbi. The rabbinical life was not for Zukor, who told a biographer years later, “I had the devil of a time persuading my uncle that I wasn't cut out for the theological calling.”
He arrived in New York at 16 in 1889 with $40 in the lining of his overcoat, a protection against theft on the boat to America. He landed a $2-a-week job sweeping floors at a fur store in the Lower East Side of Manhattan. After hours, Zukor studied English and business. Three years later, Zukor and his friend, Morris Kohn, visited the 1892 Columbian Exposition in Chicago, commemorating Christopher Columbus' discovery of America 400 years earlier. Zukor and Kohn discovered they liked the Midwest. They stayed in Chicago and started their own fur business. They were 19. Zukor was on the shy side. He stayed in the shop and Kohn handled the customers and sales. Within a year, they had 25 employees. Zukor also patented a snap for fur.
Zukor and Kohn moved back to New York City in 1900, opening a fur store. Using the royalties from his fur snap patent, Zukor invested in a more lucrative venture, the penny arcade, which featured phonographs, short movies, peep machines, shooting galleries, punching bags, stationary bicycles, and candy. The arcade did so well that soon Zukor and Kohn left the fur trade for show business. Movies were becoming popular, and the pair decided to invest in a nickelodeon theater, Hales Tours of Kansas City.
Hales Tours of Kansas City was a flop. The public stayed away in droves. He learned a life lesson: The public is never wrong, which later was the title of his autobiography. But at the dawn of the 20th century, he continued forward in the entertainment business, teaming up with a fellow furrier, Marcus Loew, who later formed Loews Theaters and co-founded MGM. Their Automatic Vaudeville Company was a success.
Nickelodeons were this company's mainstay, but the future clearly was in motion pictures. They began to purchase more businesses to convert into movie theaters, but Zukor tired of the brick-and-mortar aspect of the business. Working with Broadway producer Daniel Frohman, Zukor invested $40,000 for the North American rights to the French film “Queen Elizabeth” in 1912, which starred the formidable Sarah Bernhardt, who at 68 was still America's most famous actress. Despite having paid for the American rights, Zukor still needed a license from the Edison Trust to show the picture in his own theater. The trust denied Zukor the license.
In response, Zukor went rogue, premiering the movie without the license from the Edison Trust. On July 12, 1912, the pair screened the 40-minute film at the Lyceum Theater for New York's social elite, whose enthusiastic response told Zukor his future was in full-length feature pictures.
The success led Zukor that year to launch the Famous Players Film Company, the precursor to Paramount Pictures. Audiences flocked to the longer, star-studded films produced by the upstart independents, who soon made an exodus from the film capital of the world — Fort Lee, New Jersey — to Hollywood, California. In 1915 a federal judge ruled the Edison Trust was a monopoly, and it was dissolved.
The dissolution of the Edison Trust opened competition in the United States. The artistic freedom granted Americans quickly pushed the American cinema far ahead of the Europeans, and we never looked back. Zukor had invented the feature film in screening “Queen Elizabeth,” but by building the film's promotion around Sarah Bernhardt, Zukor also created the star system, centering films around the actors and actresses. It is amazing how inventive and innovative people who challenge the Establishment can be.
Zukor shrewdly signed up-and-coming actress, Mary Pickford, to a lucrative contract, which made the teenager a star. But she was more than a pretty face. He later recalled enduring endless salary negotiations with Pickford and her mother, Charlotte. He remembered Pickford saying, “You know, for years I've dreamed of making $20,000 a year before I was 20, and I'll be 20 very soon.”
He said, “I could take a hint. She got the $20,000, and before long I was paying her $100,000 a year. Mary was a terrific businessman.”
And so was he. His Famous Players studio -- renamed Paramount after a merger with a theater chain in 1914 -- moved from New Jersey to Hollywood, where the lighting was better for filming. But Hollywood's studio system was a factory with Paramount controlling every aspect of its film-making.
“Making Paramount into the first integrated studio was only the first step in Zukor's long quest to refashion Hollywood. He would soon face the challenge of the independent theaters, antitrust investigations, and the boycott threats of the Catholic Church. But by the late 1920s, Zukor had fulfilled his dream: He had recast American cinema in an industrial form modeled on Ford Motors, with assembly lines capable of producing gigantic and magnificent films like 'The Wizard of Oz' and 'Gone with the Wind.' Today, having weathered antitrust actions and acquisitions, six major studios based on Zukor's blueprint still control over 85 percent of the North American film market. Each remains an integrated distributor and producer of films — the battle Zukor won back in 1916,” historian Tim Wu wrote.
Zukor used the same vertical integration to make movies in the 20th century that Gustavus Franklin Swift first used in the meat-packing industry in the 19th century. Swift invented vertical integration; Zukor refined it -- and Louis Mayer at MGM refined Zukor's film-making even further. The same mind that could invent a fur snap had made film-making a snap.
In 1927, Joseph Kennedy -- who had cobbled together R-K-O -- brought Adolph Zukor, William Fox, Marcus Loew, Harry Warner, Cecil B. DeMille, and others from Hollywood to lecture the Harvard Business School. Zukor's speech was prescient.
“When I entered this business 20 years ago, men from college despised motion pictures. To work for such a company was far beneath them. But within the last few years, they have seen the tremendous future [in] motion pictures … The future of the motion picture industry will depend on college men,” he said.
Zukor also recalled how he and Fox and Laemmle had taken on the Edison Trust 15 years earlier.
“They were making the best pictures in Europe then, in France and Italy. We did not make very good pictures in this country [because of the Trust]. As luck would have it, the Pathe Company in Paris made a picture, 'The Passion Play,' which was in three reels and hand-colored. That was really the first picture of any consequence that I can recall. When I saw that picture I made up my mind to bring it to America. We arranged for an organ and a quartet to play and sing appropriate music. I did not dare open in New York [because of the Trust]. So we tried it first in Newark. We were on a street adjoining a big department store and opened up Monday morning. A great many of the bargain hunters -- I mean the ladies -- dropped in early to see and hear the performance. As they walked out, I stood at the door eager and anxious to hear the comments. People with tears in their eyes came over to me and said, 'What a beautiful thing this is.' I felt instinctively that this was the turning point, that my rent would be paid from now on,” Zukor said.
He learned his life lesson: The public is never wrong.
While the 1927 lecture was a nice look back, Adolph Zukor's greatest days were ahead of him. Talkies came along and carried the film industry through the Great Depression and beyond. Paramount's stars included Marlene Dietrich, Mae West, W.C. Fields, Jeanette MacDonald, Claudette Colbert, the Marx Brothers, Dorothy Lamour, Carole Lombard, Bing Crosby, Gary Cooper, and yes, Popeye the Sailor Man.
But the federal government went after Paramount for antitrust violation and reached an agreement that effectively cut the studio's production from 70 films a year to just 19. In another case, the U.S. Supreme Court decided Paramount could not run a studio and own a string of theaters in Detroit. But by that time, Zukor was no longer the president of the company. He was chairman of the board, a title he held until his retirement in 1959 at age 86. They named him chairman emeritus. He died at 103 on June 10, 1976.
He was a short man who liked to control all aspects of his company, a Napoleon who could be ruthless. But he always listened to the public. It is, after all, never wrong.