j LIBRM! THE MUSSUNI OF MODERN ART] Received: Scanned from the collection of The Museum of Modern Art Library Coordinated by the Media History Digital Library www.mediahistoryproject.org Funded by a donation from University of St Andrews Library & Centre for Film Studies Scanned from the collection of The Museum of Modern Art Library Coordinated by the Media History Digital Library www.mediahistoryproject.org Funded by a donation from University of St Andrews Library & Centre for Film Studies Digitized by the Internet Archive in 2013 http://archive.org/details/minutesevOOhmso BOARD OF TRADE Minutes of Evidence taken before the Departmental Committee on Cinematograph Films together with Appendices and Index First to Fourth Days Crown Copyright Reserved LONDON PRINTED AND PUBLISHED BY HIS MAJESTY'S STATIONERY OFFICE To be purchased directly from H.M. STATIONERY OFFICE at the following addresses: Adastral House, Kingsway, London, W.C.2; 120 George Street, Edinburgh 2; York Street, Manchester 1; 1 St. Andrew's Crescent, Cardiff; 80 Chichester Street, Belfast; or through any Bookseller 1936 Price 95. od. Net PRINTED AND PUBLISHED IN GREAT BRITAIN BOARD OF TRADE Minutes of Evidence taken before the Departmental Committee Cinematograph Films together with Appendices and Index on First to Fourth Days Crown Copyright Reserved LONDON PRINTED AND PUBLISHED BY HIS MAJESTY'S STATIONERY OFFICE To be purchased directly from H.M. STATIONERY OFFICE at the following addresses: Adastral House, Kingsway, London, W.C.2; 120 George Street, Edinburgh 2; York Street, Manchester 1; 1 St. Andrew's Crescent, Cardiff; 80 Chichester Street, Belfast; or through any Bookseller 1936 Price 95. od. Net CONTENTS Page MINUTE OF APPOINTMENT OF COMMITTEE ' iii LIST OF WITNESSES ,v MINUTES OF EVIDENCE 1 INDEX TO EVIDENCE... 95 Ill DEPARTMENTAL COMMITTEE ON CINEMATOGRAPH FILMS MINUTE OF APPOINTMENT The Board of Trade are pleased to appoint the following persons, viz. : — The Rt. Hon. Lord MOYNE, D.S.O. (Chairman), Mr. ALAN CHARLES CAMERON, M.C., Mr. JOSEPH STANLEY HOLMES, M.P., Mr. JAMES JOSEPH MALLON, The Hon. ELEANOR MARY PLUMER, Lt.-Col. Sir ARNOLD WILSON. K.C.I.E.. C.S.I., C.M.G., D.S.O., M.P., to be a Committee to consider the position of British films, having in mind the approach- ing expiry of the Cinematograph Films Act, 1927, and to advise whether any, and if so what, measures are still required in the public interest to promote the production, renting and exhibition of such films. The Board are further pleased to appoint Mr. W. H. L. Patterson to be Secretary to the Committee. (Signed) WALTER RUNCTMAN. Board of Trade 25th March, 1936 IV LIST OF WITNESSES Interest represented. Names of Witnesses. Page. Associated Realist Film Producers, Ltd. Mr. Paul Rotha 59 Association of Cine-Technicians ... Mr. S. H. Cole ... Mr. D. Dickinson Mr. G. H. Elvin }•' Board of Trade Mr. R. D. Fennelly 1 Cinematograph Exhibitors' Association of Gt. Mr. T. H. Fligelstone . } » Britain and Ireland. Mr. W. R. Fuller Film Producers' Group of the Federation of Mr. F W. Baker ] British Industries. Mr. M. N. Kearney Mr. A. Korda ... Mr. N. Loudon ... y 34 Capt. The Hon. R. Norton J MINUTES OF EVIDENCE TAKEN BEFORE THE COMMITTEE ON CINEMATOGRAPH FILMS FIRST DAY Tuesday, 5th May, 1936 Present : The Rt. Hon. Lord MOYNE, D.S.O. (Chairman). Mr. A. C. CAMERON, M.C., M.A. Mr. J. S. HOLMES, MP. Dr. J. J. MALLON, LL.D., J. P. The Hon. ELEANOR M. PLUMER, Lt.-Col. Sir ARNOLD WILSON, K.C.I. E., C.S.I. , C.M.G., D.S.O., M.P. Mr. W. H. L. PATTERSON (Secretary). Mr. R. D. Fennelly, representing the Board of Trade, called and examined. The Committee had before them the following memorandum by the Board of Trade:- I. — The position before the Cinematograph Films Act, 1927. 1. It has been estimated that in the year 1914 some 25 per cent, of the films shown in Great Britain were made in this country. Under stress of war conditions, however, production declined not only in the United Kingdom but in the chief Con- tinental countries, and the United States were able to obtain almost a monopoly of the world markets in a form of entertainment which was rapidly grow- ing in public favour. The dominating position thus secured by the United States made the recovery of film production in the United Kingdom after the war increasingly difficult, and although in the year 1923 it is estimated that about 10 per cent, of the films exhibited in this country were British, yet the proportion of British films displayed about the beginning of 1927 was not more than about 5 per cent. Of the balance 85 to 90 per cent, were of United States origin. Whereas in the year 1924 the total number of " feature " films made in this country appears to have been about 58, the output had fallen in 1925 to 34 and in 1926 to 26, together with perhaps three or four from the Empire over- seas. There was in fact some danger of production in this country ceasing altogether. 2. The domination of United States films in the post-War period was due to the following factors amongst others — (i) There was in the United States a vast and growing home market. There were by 1926 some 22,000 cinema theatres in the U.S.A. as compared with about 3,000 in this country. (ii) The opportunities offered by the industry induced reputable people to sink a very large capital in the industry. (iii) The best technicians and the best " stars T' were consequently attracted to the United States, and the large home market enabled the production of costly films to be undertaken. (iv) In technical methods and research the United States consequently progressed during the War and after it far beyond producers in other countries. 36452 3. Arising out of the fact that they were dis- tributing the best films in the world the United States subsidiary renting organisations in this country took advantage of the position to obtain a strong hold over the exhibitor. A much advertised film was only hired to him if he contracted to take with it a number of other films, many of which he had not even seen and some of which might not even have been made. This was the system known as " block " booking and " blind " booking and the effect was to tie the exhibitor to one or more renters for a long period ahead. Moreover, these renting organisations could afford to advertise a film so thoroughly that an exhibitor was almost driven to hire it. 4. As a result when a good film was produced in this country so many exhibitors were booked up for long periods ahead that the producer could not place the film and had to stand out of his money over considerable periods. This naturally put a brake on production, and it was not easy to attract money to the industry. British films, too, began to be booked before they were actually made, and the budget of production costs was assessed on the bookings — with at times unfortunate results for the exhibitor. 5. By 1925 the depressed state of the British industry was causing general concern. Apart from the purely industrial aspect of the matter, it was felt that from the point of view of British culture and ideals it was unwise to allow the United States to dominate the cinemas of this country. At that period nearly every film shown represented American ideas set out in an American atmosphere, and the accessories were American houses, American materials, American manufactures, etc. Whatever the position to-day, cinematograph audiences then were made up of the most impressionable sections of the community, and it was felt to be of the utmost importance for our prestige, for our trade and, it was even asserted, for our morals that they should see at least some proportion of British films. In other words, it was felt that a British film industry was a national asset. Protracted discussions took place between the Board of Trade and the Federa- tion of British Industries and the trade organisa- tions concerned, and an attempt was made by the industry to secure an increased exhibition of British films by voluntary effort. COMMITTEE ON CINEMATOGRAPH FILMS 5 May, 1936.] Mr. R. J>. Fennelly. [< <,i i tinned . 6. While this voluntary experiment was going on the question of British films was considered by the Imperial Conference of 1926. The report of the Gen- eral Economic Sub-Committee appointed by the Conference drew attention to the small proportion of films of British Empire origin shown in the several parts of the Empire. In Great Britain and Northern Ireland the proportion was about 5 per cent., and in the Irish Free State was probably no higher. In Australia the proportion by number of British Empire films imported in 1925 was slightly in excess of 8 per cent., although on a basis of total feet imported it was considerably less. In New Zealand some 10' per cent, of Empire films appear to have been shown. The proportion in Canada, South Africa, and the remaining parts of the Empire was known to be very small although statistical details were not available. 7. The Sub-Committee attached great importance to the increased production within the Empire of films of high entertainment value and outstanding educational merit, and to their wide exhibition throughout the Empire and the rest of the world. They pointed out that in foreign films the conditions in the several parts of the Empire and the habits of the people, even when represented at all, were not always represented faithfully, and were at times misrepresented. Moreover, the constant exhibition of foreign scenes or settings and the absence of any corresponding showings of Empire scenes or set- tings powerfully advertised foreign countries and foreign goods. The Sub-Committee suggested certain remedial measures including effective Customs duties, ample preference or free entry for Empire films, legislation for the prevention of " blind " and " block " booking and the imposition of require- ments as to renting or exhibiting of a minimum quota of Empire films. They also pointed out that, as Great Britain and Northern Ireland was the largest producer of films and also the largest Empire market for films, any action taken in this country would undoubtedly be < of the greatest assistance to other parts of the Empire in dealing with the film problem. 8. The Report of the Sub-Committee was approved by the Imperial Conference, which unanimously adopted the following resolution: — " The Imperial Conference, recognising that it is of the greatest importance that a large and increasing proportion of the films exhibited throughout the Empire should be of Empire pro- duction, commends the matter and the remedial measures proposed to the consideration of the Governments of the various parts of the Empire with a view to such early and effective action to deal with the serious situation now existing as they may severally find possible." 9. When the position was surveyed in the United Kingdom after the Imperial Conference it was found that the voluntary experiment had admittedly failed and the Government accordingly passed the Cine- matograph Films Act, 1927, which was not only intended to safeguard the position in this country but also to give a lead to other parts of the Empire. II. — The Purpose of the Cinematograph Films Act, 1927. 10. It should be explained that the cinematograph lilms industry in Croat Britain and Indeed in all countries is organised on the three-tier basis of maker (or producer), renter (or distributor) and exhibitor. It may be added that, although they are three separate entities for the purpose of the Act, there is considerable financial and other interlocking in Great Britain between the various sections of the trade. This is dealt with in the later sections of the memorandum. 11. The purpose of the Act was to build up a. healthy film-making industry so that British films could find their due place on the screens not only of Great Britain and the Empire but of foreign coun- tries. The two main objects of the Act were: — (i) to impose certain restrictions on " blind " and " block " hooking so as to release the ex- hibitor from the hold acquired over him by the United States renting organisations; (ii) to assist production in the United King- dom and elsewhere in the Empire by placing an obligation on renters in the United Kingdom to acquire and on exhibitors to show an increasing proportion of British films during the currency of the Act. III. — Blind Booking, Advance Booking and Block Booking of Films. 12. This subject was referred to in a paper on " The Future of the Films Act " which was read by Mr. Simon Rowson, at a conference of the Cinemato- graph Exhibitors Association held at Cardiff in June, 1935. The following extracts have been taken from that paper. " ' Blind ' booking had for some years been denounced as one of the most serious evils intro- duced by the renters into the commercial prac- tice of the film trade. It led to the sale of films before they could be seen in this country, and often before they were made. The producer announced a series of subjects — his programme — and the distributor responsible for selling this producer's output opened his sales campaign. The programme would consist of 20 to, perhaps. 50 subjects. Sometimes ' stars ' were specified alongside of certain subjects ; at other times the ' stars ' would be designated before any subjects were allotted. Two or three of the sub- jects might be made and shown to the trade before the sales campaign began. The salesmen were ordered to sell the programme on the strength of these first productions as representa- tive samples of the entire programme. It was rare indeed that the later subjects realised ex- pectations, much less the representations of the enthusiastic salesmen. Frequent changes were the almost invariable rule in the fulfilment of the unmade portion of the programme. And the exhibitor's disappointment was the more acute because not only did the later pictures prove less good than the earlier ones, or fail to materialise at all, but he was often compelled to accept substitutes from which the promised stars were absent and sometimes even the sub- jects themselves were different. And there was or could be no effective remedy lor the exhibitors, because at any given date the supply of alterna- tive subjects is a strictly limited one. The exhibitor had in fact to consider, not so much the 700 or 800 films which in those days repre- sented the year's total output of the American studios ; but rather had he to pay attention to an average of 14 or 15 films which made an appearance each week. By the sales system then and still in vogue, practically all these subjects, and certainly the most attractive ones, were already contracted for by various exhibitors. The only resource of the disappointed showman was either to substitute with a film which he was willing to play concurrently with other exhibitors, or to play a film as ' second run which had proved exceptionally successful in some neighbouring theatre one or two weeks earlier, or show a much inferior film. These alternatives were frequently attended with ex- ceedingly unsatisfactory results. " The adoption of a similar system by British producing companies proved even more vicious in its consequences. Here the far-forward system of bookings was attended with the fol- lowing result. On 1st January, say, bookings were taken in connection with a subjeel to be released maybe 15 months later. The picture MINUTES OF EVIDENCE .5 May, 1936.] Mr. R. D. Fennelly. [Continued. itself was, for various reasons — but principally to avoid the loek-up of capital for too long — not put into production in the studio till towards the end of the year. Far too often, the budget of production cost was revised in line with the bookings taken and was made lower than was at first intended, and the picture resulting was, naturally, much less attractive than the ex- hibitors .who booked it could reasonably expect. " The exhibitors had therefore two evils to contend against both arising from the ' blind ' and ' block ' booking practices. By the time the American films reached the British screen they were ' dated,' and the clothes worn by the favourite stars had become old-fashioned. Similarly, the British film was less attractive than had been promised. " The Government decided to meet the grievance by making ' blind ' booking an offence which rendered the contract invalid and the parties to any such arrangement guilty of a mis- demeanour and liable to money penalties. A ' blind ' booking was, in effect, defined as one which related to a film that had not been trade- shown in London. Though the exhibitor might not have seen the film himself, the trade show guaranteed that it had a physical exist- ence, that is would be delivered as shown, and that, if he desired, he could obtain a report of its suitability and value from the agent, or from the trade papers which make the reviewing of every new film a principal function of their existence. " Closely related to the ' blind ' booking provision of the Act was the attempt to deal with the advance-booking evil. There were many at the time who felt that this part of the Act was superfluous. The argument was that if business could be inaugurated only after the physical existence of the film was established and all the expense of production had been in- curred, sufficient inducement existed to secure the maximum reduction of the interval between trade show and sales-dates and exhibition dates. The producer (through his agent the renter) would naturally exert the maximum pressure to secure the earliest possible play-dates, especially as, in contrast with the prevailing practice in other countries, no payments on signing contracts or at any date in advance of playing, ever form part of the exhibitor-renter contract in this country. But the Government thought otherwise, and insisted on their clause for the reduction, by easy stages, of the maximum interval between the sales-date and play-date from 12 to 6 months. " It may be possible to give convincing proof that they were right who believed the advance- booking clauses of the Act were unnecessary. It is much easier to prove, however, that these clauses have been ineffective, and have at all times been more honoured in the breach than in the observance. Every salesman in the trade knows that booking arrangements are made every day for films which will be played long after the legal date. Sometimes they are called reservations only, at other times they are ' gentlemen's agreements,' at still other times the illegal interval is bridged by a series of one or more transfers of dates. Most frequently contracts are signed by the exhibitors, left with the salesman with power to insert a date when the contract is assumed to have been executed and confirmed by the renter. It is undeniable that this procedure is illegal. It is equally certain that both parties are equally guilty of this illegal practice. But though the existence of this illegal practice is known throughout the trade, and is also, I think, not unknown to the Board of Trade, I cannot recall a single case in which the Department has in- stituted proceedings, and what is, perhaps, even more striking, I believe there has not been a single occasion when the validity of such contracts has been questioned in a court of law." 13. Part I of the Cinematograph Films Act, 1927, seeks to remedy the abuses referred to above by prohibiting the blind booking and the excessive advance booking of films. The restrictions imposed necessarily affect the booking of films in blocks, but block booking as such is not specifically pro- hibited or controlled. 14. 7?//'//'/ Bonking. — Section 1 makes it illegal to enter into an agreement to rent, or imposing an obligation when called on to rent, any film to which the Act applies until the film has been registered or a valid application for its registration has been made, and Section 5 (1) prohibits the exhibition of a film or a part of a serial film or series of films unless the film has been registered. Under Sec- tion 6 (4) an application for registration is not valid until the film has been trade shown. Modifications of these prohibitions are made in the following circumstances: — ■ (a) The booking of a film which has not been previously exhibited to exhibitors or to the public for exhibition at one theatre only on a number of consecutive days and also the ex- hibition of a film at one theatre only on a number of consecutive days. The first of these exhibi- tions constitutes, for registration purposes, the statutory trade show (definition (b) under Section 32 (1)). These relaxations of the general provisions recog- nise and permit the common trade practice of giving, generally at prominent Metropolitan theatres, early and special pre-release exhibitions of some of the more important films for longer periods than is usual at the ordinary cinema. (b) After the first three parts of a serial film or series of films have been registered, or valid applications for their registration have been made, the whole serial or series may be booked without trade show of the remaining parts. 15. Advance Booking. — Section 2 prohibits the excessive advance booking of films by limiting the period between the date of the contract and the date of exhibition. The authorised period was reduced by stages from 12 months for contracts made before 1st October, 1928, to six months for contracts made since the 1st October, 1930. In the booking of a serial film or series of films the authorised period applies only to the first three parts. 16. Penalties. — Under Section 3 contravention of Sections 1 and 2 renders the offender liable, on summary conviction, to a fine not exceeding £50. Any agreement in contravention of Sections 1 and 2 is invalid. 17. The Board of Trade have received from many sources information that Sections 1 and 2 are being widely contravened. They understand that it is a common practice for a renter to arrange with one or more exhibitors in an area to take the whole or agreed parts of his supply of films. In some cases the renter may refuse to rent any films unless the exhibitor agrees to take the whole or a stated part of his supply, including films not yet registered. In other cases actual terms may not be discussed or formal contracts signed until after the films con- cerned have been registered, thus leaving the exhibitor in a position to reject the films if their quality or the terms offered should be unacceptable to him. 18. The Board have been able to take proceedings under Section 3 in only one case. On that occasion, in 1928, they obtained possession of a copy of a post- card to exhibitors in which a renter stated that he 36452 A 2 COMMITTEE ON CINEMATOGRAPH FILMS 5 May, 1936.] Mr. R. I>. Fennel j,y. [Continued. had booked to certain specified theatres a film which, at the date of the circular had not been registered. Since then the Board have found it impossible to obtain evidence on which they could found a prosecu- tion, the difficulty being mainly that the only per- sons who could furnish such evidence are the parties to the illegal agreement. Moreover it has been alleged to the Board by exhibitors who have com- plained of these practices that if they facilitated pro- ceedings the renter concerned, and possibly other renters, might interrupt his supply of films and thus prejudice his livelihood. 19. Furthermore, the producer-renter-exhibitor combines exhibit the majority of their films at their own theatres. The reservation of dates for those films may involve, in some cases, the equivalent of excessive advance and even " blind " booking, but it would obviously be impracticable to institute pro- ceedings in such cases. 20. While it must be admitted that in this matter the Act has proved to be largely ineffective and un- enforceable, the existence of the statutory restrictions prevents renters from compelling exhibitors to enter into legally enforceable contracts of the kind which Parliament intended to prevent, and to that extent affords exhibitors opportunities of reconsidering and repudiating unduly burdensome agreements if they wish to do so. 21. Certain proposals to improve the position were made by the Advisory Committee in the Report which is before the Departmental Committee. IV. — The " Quota " Provisions of the Act. 22. As pointed out above, the Act sought to assist the production of films by imposing an obligation on renters to acquire and on exhibitors to show an in- creasing proportion of British films. These provisions are shortly summarised in the following paragraphs. 23. Under Section 27 (3) of the Act a British film is defined as one which has been made by a Biitish subject, or subjects, or by a British company (which is, for this purpose, one constituted in any part of the British Empire, the majority of the directors of which are British subjects). The studio scenes must have been shot in the British Empire ; the author of the scenario must have been a British subject and, generally speaking, not less than 75 per cent, of the salaries, wages and payments specifically paid fo"r labour and services in the making of the film (ex- cluding payments in respect of copyright and to one foreign actor, actress or producer) must have been paid to British subjects or persons domiciled in the Empire. The statutory requirements are dealt with at length in Appendix I. 24. The Act provides that no film shall be rented or exhibited unless it has been registered by the Board of Trade either as a British film or as a foreign film, and prohibits the renting or exhibiting of films in the absence of a licence issued to the renter or exhibitor, as the case may be, by the Board of Trade. 25. As regards the actual quota provisions, the Act provides that a renter in each of the quota years shall acquire for the purposes of renting at least a specified percentage of British films, the per- ceiltage being specified both as regards the long films (3,000 feet or upwards) and also in respect of all films, long or short (the latter being those of less than 3,000 feet). It is thus possible for any de- ficiency in British short films to be satisfied by a corresponding increase in the length of the British long films acquired. Provision is also made for small renters to combine for quota purposes with the per- mission of the Board of Trade. Renters are re- quired to keep records of the films acquired by them for renting and to make returns annually to the Hoard of Trade. The return which is made at the end of the renters' quota year shows all the films acquired by them and also the extent to which they have been booked for exhibition. The renter is also required to make a supplementary return 12 months later, giving additional details of the book- ings that have been taken. This enables the Board to ensure that films which are acquired late in a quota year have been bona fide acquired for the pur- poses of renting and not merely for quota purposes. The Board are empowered to inspect the records kept on renters' premises and also to examine the returns made to them in order to satisfy themselves that there has been compliance with the provisions of the Act. 26. In the case of exhibitors, the Act similarly provides that during each quota year a specified percentage of the total length of films exhibited shall be British. As in the case of renters the obligation is in respect of long films and all films separately. It may be noted, however, that whereas in the case of renters the quota is based on the total length of the films acquired for renting, in the case of exhibitors the basis of the quota is the total length of the films exhibited multi- plied by the number of times such films are exhibited during the hours when the theatre is open. As in the case of renters, provision is made for exhibitors to keep prescribed records with regard to the films exhibited which are open to inspection, and for annual returns to be made to and examined by the Board of Trade. 27. The quota scales laid down in the Act are as follows: — [The renters' quota year ends on the 31st March and the exhibitors' quota year on the 30th September]. Renters' quota Exhibitors' quota Percentage. Percentage. 1929 n 5 1930 10 n 1931 10 n 1932 m 10 1933 15 12J 1934 17J 15 1935 17 J 15 1936 20 20 1937 20 20 1938 20 20 The difference in the renters' and exhibitors' quota years is due to the fact that there is always a con- siderable time lag before a film acquired by a renter is available for general distribution to exhibitors. It will be observed that at the present time the maxima quotas laid down in the Act have already been reached and that for most purposes the Act expires, so far as renters are concerned, at the end of March, 1938, and, so far as exhibitors are con- cerned, in September of the same year. 28. Provision is also made for prosecution, either in a summary manner tin or indictment, of renters or exhibitors who fail to comply with their quota obligations. In the case of a third offence, the renter or exhibitor may be deprived by the Court of his licence to rent or exhibit films, as the case may be. Provision is also made for a certificate to be issued by the Board of Trade where failure to comply with the quota was due to reasons beyond the control of the renter or exhibitor, such as the character of the British films available or their cost. 29. The Act was designed to promote the making in this country of the fictional or dramatic films which form the bulk of the programme in the ordinary cinema and necessitate the use of studios and the employment of artistes, technicians and general labour to a considerable degree. It was accordingly deemed necessary to exclude certain classes of films from the operation of the Act. as otherwise renters of foreign films would have been able to meet their obligations by acquiring cheaply- produced films with little or no studio work. The excluded classes, which are enumerated in Section MINUTES OF EVIDENCE 5 May, 1936.] Mr. R. D. Fennelly. [Continued. 27 (1) include films depicting mainly news or current events, natural scenery, commercial advertisement, films wholly or mainly depicting manufacturing pro- cesses and scientific, including natural history, films. 30. It was recognised, however, that some such films might be of importance and that their exhibition should be encouraged on cultural grounds. It was accordingly provided that the Board of Trade could allow films of any of these classes to be registered for the purposes of the renters' and exhibitors' quotas on the ground of " special exhibition value ". A small number of films are registered under this pro- viso every year, after consultation with the Advisory Committee. Further, in order to assist their ex- hibition in the cinemas, British films falling within the excepted classes, other than those depicting mainly news or current events and commercial ad- vertisements, are entitled, although not required, to be registered for the purposes of the exhibitors' quota only. There is a growing registration of such films in view of the increased output of documentary and " interest " films which are not covered by the Act. 31. For the purposes of advising the Board of Trade on the administration of the Act provision is made for the appointment of an Advisory Committee consisting of two representatives of film makers, two representatives of film renters, four representatives of film exhibitors and five independent members (one of whom is to be Chairman and one must be a woman). Under the Act the Advisory Committee has certain statutory functions to perform. For instance, all cases of quota default on the part of renters or exhibitors must be submitted to them for advice before a decision to refuse a certificate that the defaidt was due to circumstances beyond their control is reached by the Board of Trade. In practice, however, the Board consult them on other questions also. V. — The Position of the Producers. 32. The makers or producers of films are combined for trade association purposes in the Film Producers' Group of the Federation of British Industries (Secre- tary : Mr. M. Neville Kearney). 33. There has been a very large increase in the facilities available for making films in Great Britain since the passing of the 1927 Act. The Film Pro- ducers' Group in the course of their evidence will presumably be prepared to furnish details of the number of studios and stages which are now in existence as compared with 1927. There is no doubt however that since that date old studios have been rebuilt and re-equipped and new studios erected which on the technical side compare favourably with those of the United States. Considerable amounts of capital have been put into film production by the investing public and a number of new important producing companies have appeared. 34. A list of the principal makers of fiction and dramatic films in this country is given in Appendix III. Among the leading producers are: — Gaumont-British Picture Corporation, Ltd., with studios at Shepherd's Bush and Islington. Associated British Picture Corporation, Ltd. (formerly British International Pictures, Ltd.), with studios at Elstree and Welwyn Garden City. London Film Productions, Ltd., who are erect- ing large modern studios at Denham, Bucks. British and Dominion Film Corporation, Ltd. 35. In addition there are a number of producers making interest, scientific, educational, etc., films, which do not in general fall within the ambit of the Act. 36. It will be observed from Appendix III that there are a number of production companies or units which do not own studios. These companies or units are usually formed for the production of one or more films which are made either in the studios of other producers, as stages become available for letting during intervals in their own production programmes, or in studios owned by companies who specialise in letting and make few, if any, films themselves. 37. Before he embarks upon the cost of producing a picture the producer wishes, if possible, to be certain of his market. For this reason the important production companies, especially those which own studios, are in association with distributing com- panies. The connection between the producing and renting companies is shown in Appendix IV. The independent production units usually make an arrangement with a renter before embarking on a film. These arrangements vary in character. Some- times the renter will make an advance towards the cost of the picture; in other cases the renter pays a lump sum down on delivery of the negative which may or may not be combined with an arrangement whereby the maker and renter share the proceeds of the distribution of the film in certain proportions; and in other cases the renter takes the picture on a sharing basis without any lump sum payment. 38. In the case of Gaumont-British Picture Cor- poration, Ltd., and Associated British Picture Cor- poration, Ltd., the process of vertical combination is carried a stage further in that they also control circuits of cinemas amounting to 330 in the case of the former and 225 in the case of the latter. The control of these cinemas assures, of course, a definite market for their product through their associated renting organisations. 39. It is understood that the Fox Film Company of America have a considerable holding in the Gaumont-British Picture Corporation which, how- ever, does not amount to control, but apart from this there is, so far as is known, little foreign capital invested in the production side of the United Kingdom industry. Only three United States rent- ing organisations (Fox Films, and Warner First National jointly) have acquired studios in this coun- try for the production of the films required to meet their obligations under the Act. The remain- der obtain their films from various sources — mostly from independent producers who hire studios for the purpose of making them. 40. The following tables " A " and " B " show the number and length .respectively of British and foreign long and short films registered for renters' quota during the years since the Cinematograph Films Act, 1927, became operative: — Table A. Number of films registered. Period Long. Short. All Films. (years ended March 31). British. Foreign. Total. British. Foreign. Total. British. Foreign. Total. 1929 128 550 679 150 663 829 278 1,213 1,491 1930 96 506 602 180 885 1,065 276 1,391 1,667 1931 122 556 681 53 976 1,058 175 1,532 1.7H7 1932 153 464 618 44 917 977 197 1,381 1,678 1933 159 481 643 41 741 841 200 1,222 1,422 1934 190 484 679 48 647 707 238 1,131 1,369 1935 189 477 667 67 697 820 256 1,174 1.430 1936 212 506 718 85 578 663 297 1,084 1,381 COMMITTEE ON CINEMATOGRAPH FILMS 5 May, 1936.] Mr. R. D. Fennelly. [Contin tied. Table B. L> ' iiijlh of films registered (in thousand feet). Period Long. Short. All Films. (years ended March 31). British. Foreign. Total. British. Foreign. Total. British. Foreign. Total. 1929 904 3,400 4,304 170 922 1,092 1,074 4,322 5,396 1930 624 3,331 3,955 150 1,204 1,354 774 4,535 5,309 1931 789 3,649 4,438 60 1,160 1,220 849 4,809 5,658 1932 928 2,962 3,890 59 1,071 1,130 987 4,033 5,020 1933 961 3,057 4,018 47 893 940 1 ,008 3,950 4,958 1934 1,180 3,115 4,295 60 769 829 1,240 3,884 5,124 1935 1,183 3,116 4,299 68 891 959 1,251 4,007 5,258 1936 1,379 3,316 4,695 96 756 852 1,475 4,072 5,547 41 . It will be seen that as was to be expected there was a considerable output of British films in the first year of the Act. In 1930 and 1931 production was to a certain extent disorganised by the introduction of sound, but British producers had made so satisfactory a start that they were able to surmount this obstacle and after 1931 pro- duction increased rapidly. The number of British films produced has always been far in excess of those required to meet the statutory quota on the foreign films registered. 42. It will be observed that on the other hand there has been a decrease with slight fluctuations in the foreign long films registered both as regards number and length since the first year of the renters' quota. This reduction is probably ac- counted for partly by economic conditions in the U.S.A. and partly by the fact that the increased production of British films and the cost of pro- viding quota has made it unprofitable to bring to this country certain poorer quality American films which could profitably be distributed under the con- ditions which prevailed before the Act came into force and during the first year or two of its opera- tion. 43. It will be further observed that British short films showed a considerable decrease both in num- ber and length until 1933 when some slight degree of recovery took place. This decrease in short films has been apparent however not only in British but also in foreign films. The small output of British short films is probably due largely to the unfavourable economic conditions under which they are made and sold. In the case of foreign films it is probably due in considerable measure to the increasing extent to which programmes shown to the public consist of two long films and a news reel instead of one long film and several short films. There has. however, in the last two years been a considerable increase in the output of short " interest " and documentary films, many of which have been registered Eor exhibitors' quota. Forty-six short films were registered in this way in the year ended 31st March, 1936, as against three long films. 44. The Board of Trade are not in a position to estimate either the capital invested in the pro- duction side of the industry or the cost of British films. In order that the Board may be in a posi- tion to assure themselves that the requirements of the Act in relation to British films have been complied with, the producer has to furnish particu- lars of the salaries, wages and other payments made to persons directly employed in the making of a film. The total expended in this way in respect of British films made in the quota year 1935-6 amounted to £2.750.000. This total excludes pay- ments made in 95 cases to foreign artists and pro- ducers (usually highly paid). It does not include cost of sets and other materials, studio hire where paid, and general overheads. The total amount expended in production in 1935-6 may therefore have been of the order of £5,000,000 or more, but the figure is suggested with all reserve. 45. The particulars of British films given in para- graph 40 include films made not only in the United Kingdom but elsewhere in the Empire. The follow- ing table " C " gives particulars of the films made outside Great Britain which have been registered for full quota as British since the Act came into force. Practically all these films were acquired by foreign- controlled renters. It will be seen that in the quota year 1935-6, for instance, only 11 of the long films registered as British under the Act were made outside Great Britain. Six of these came from Australia while three were Indian silent films made some years ago and not hitherto registered in this country. Table C. No. of films. Quota Year. Long. Short. 1928-9 8 1 1929-30 7 - 1930-1 9 5 1931-2 6 1 1932-3 9 8 1933-4 9 4 1934-5 11 - 1935-6 11 - Total 70 19 Full details are given in Appendix V. VI. The Position of the Renters. 46. The renters or distributors of films are com- bined for trade association purposes in the Kinematograph Renters' Society (Secretary. Mr. F. Hill). 47. A- already stated, renters who distribute films fcol which the Act applies must lie in possession of an MINUTES OF EVIDENCE 5 May', 1936.] Mr. R. D. Fennelly. [Contih hi ,1 . annual licence issued by the Board of Trade. The number of licensed renters in recent years has been : — 1933-4 51 1934-5 55 1935-6 65 A considerable number of these renters only register one or two films or none at all (22 renters acquired no registered films in 1935-6), and the number of renters who registered more than six long films was 22, 16 and 19 in the years mentioned above. A list of the principal renters is given in Appendix IV. Nine are subsidiary companies in the United King- dom of the chief United States producers' organisa- tions, as follows: — Columbia Pictures Corporation, Ltd. First National Film Distributors, Ltd. Fox Film Company. Ltd. Metro-Gold wyn-Mayer Pictures, Ltd. Paramount Film Service, Ltd. Eadio Pictures, Ltd. United Artists Corporation, Ltd. *Universal Pictures, Ltd. Warner Brothers Pictures, Ltd. In the renters' quota year ended 31st March, 1936, these nine foreign companies hetween them distri- buted 342 out of a total of 506 long foreign films registered in that year. They also distributed 113 out of 212 British pictures. 48. The chief renting companies associated with British producing firms are: — Associated British Film Distributors, Ltd. British Lion Film Corporation, Ltd. * See note on General Film Distributors to para. 48. Butcher's Film Service, Ltd. Gaumont-British Distributors, Ltd. ^General Film Distributors, Ltd. Pathe Pictures, Ltd. Wardour Films, Ltd. Twickenham Film Distributors, Ltd. Gaumont-British Distributors, Ltd., mainly dis- tribute British films produced by Gaumont-British Picture Corporation, Ltd., and Wardour Films, Ltd., and Pathe Pictures Ltd., those made by Associated British Pictures Corporation, Ltd. These renters, however, all occasionally distribute British films made by independent units. Between them they were responsible for distributing 86 out of 212 British films registered in 1935-6, and 87 out of 506 foreign films. 49. As already stated, every renter is under an obligation to acquire each year a certain proportion of British films in relation to the total films acquired. The following table " D " taken (with some modifications and the addition of figures for 193-5-6) from a paper recently read by Mr. S. Rowson before the Royal Statistical Society, shows the quota during each of the years ended March from 1929 to 1936, together with the corresponding number of British and foreign films registered for renters' quota during that period. * This is a new renting organisation which distributes films made by a number of independent film units. It has recently become associated with a group under Lord Portal which has bought into Universal Pictures, the United States producing concern, and has taken over the distribution in the United Kingdom of Universal films. Table D. Comparison of British Films produced with minimum quota requirement. 1 2 3 British shorts 4 British shorts 5 6 7 8 Minimum length of 9 Actual length of 10 Exc< 11 ?ss of Year Quota Foreign shorts required if there regis- tered Deficiency in Foreign Longs British Longs British Longs British Longs British proc Longs uced. ended per cent. regis- tered were a separate for renters' Col. 4. regis- tered. required for quota. required for quota regis- tered for March 31. quota on quota. Col. 7 + renters' Per cent. shorts. Col. 5. quota. Length. '000 ft. '000 ft. '000 ft. '000 ft. '000 ft. '000 ft. '000 ft. '000 ft. 1929 H 922 75 170 3,400 276 276 904 628 230 1930 10 1,204 134 150 — 3,331 370 370 624 254 70 1931 10 1,160 129 60 69 3,649 405 474 789 315 66 1932 121 1,071 153 59 94 3,962 566 660 928 268 40 1933 15 893 158 47 111 3,057 540 651 961 310 48 1934 m 769 161 60 101 3,115 661 762 1,180 418 55 1935 m 891 189 68 121 3,116 661 782 1,183 401 51 1936 20 756 189 96 93 3,316 829 922 1,379 457 50 50. It will be observed that since the year ended March. 1930, there has been a deficiency in British short films calculated on the basis of the quota percentage of the length of foreign short films registered. So far as the combined quota of long and short films is concerned, there has been, how- ever, in each year a considerable excess of British long films registered over the actual length of British long films required to meet the quota both in long films and in all films. The liability for quota is, however, generally speaking, an individual one. Table K shows the quota liability for all films of the main British and foreign renting companies in this country during the quota year ended March, 1935, together with the actual length of British films registered by them during the year in question. COMMITTEE ON CINEMATOGRAPH FILMS 5 May, 1936.] Mr. R. D. F&NNELLY. [' 'onttnued. Table E. Comparison of British films registered by the principal roiiijimiirs in \\)'.\\ 5 uiih their minimum quota require- ments. Quota Length Liability. Registered. ('000 ft.) ('000 ft.) British Companies. Associated British Film Distri- butors ... 51 43 Associated Producing & Distri- bution Co. 7 23 British Lion Film Corporation ... 12 42 Butcher's Film Service ... 8 45 Gaumont-British Distributors ... 47 210 Pathe Pictures 38 39 Wardour Films ... 31 120 Foreign Controlled Companies. Columbia Pictures Corporation 68 68 First National Film Distributors 49 49 Fox Film Co 69 69 Metro-Goldwyn Mayer Pictures Ltd 89 89 Paramount Film Service 97 98 Radio Pictures 78 78 United Artists Corporation 27 52 Universal Pictures Ltd. ... 113 113 Warner Bros. Pictures ... 47 47 Detailed figures for the year ended March, 1936, will not be completely available until the renters' returns for 1935-6 have been received and examined, but preliminary estimates will show much the same result as in 1934-5, namely, that the foreign con- trolled companies tend to register just sufficient British films to meet their quota obligations, while the British companies in general acquire registered films far in excess of the obligation. Among the foreign controlled companies the exception is United Artists who act as distributing agents in this coun- try for the films produced by London Film Produc- tions Ltd. and British and Dominions Film Corpora- tion Ltd. 51. Although the question of the quality of British films will be discussed more generally at a later stage in the memorandum, it may be in- teresting at this point to compare the quality of the British and foreign films acquired by the British and the foreign controlled renters. The following table F is taken from the paper by Mr. S. Rowson to which reference has already been made. Table F. Estimated ( Weighted) Average Marking of Films in 1934. Registered by British films. Foreign films. British Companies Foreign Companies 8 7 8 This table is based upon the markings assigned to films by the Cinematograph Exhibitors' Associa- tion Review. Markings are based on a maximum of 10, but the difference between seven and eight marks represents a considerable difference in esti- mated value.* This table shows that the foreign controlled companies get the best foreign films and the worst British films and contrariwise that the * The markings may roughly bo grouped as follows : — Under 7 ... Bad. 7 — 7 J ... Second features for small country cinemas. 7 J — 7| ... First feature for small cinemas; some may serve as second features elsewhere. 8 — 8£ ■•• First feature for most cinemas. 8J or over. Films of the " super " type. British renting companies get the best British films and the worst foreign films. So far as these mark- ings are reliable, they also show that the British films rented by British companies were on the aver- age of as high a quality as the foreign films rented by the foreign controlled companies. 52. The following table G shows the number of renting firms in default with their quota in each of the years ended March, 1933, to 1935. Table G. Year ended Number of Number of Number of March 31 Renters licensed. Defaults. Prosecutions. 1932-33 45 8 1 1933-34 51 3 — 1934-35 55 6 — 1935-36 65 18 * Most of the defaults occurred amongst small renters who register only one or two films and in many cases it is found that these renters go out of busi- ness before the end of a renters' year. Under the Act a renter who is in default is entitled to make a submission to the Board of Trade and to claim a certificate if he can show that the reasons for his non-compliance with the Act were outside his control. Before a decision is reached on the ques- tion of granting a certificate these cases of default are referred to the Cinematograph Films Advisory Committee as required by the Act. It will be observed that in only one case in the three years 1932-5 have proceedings been instituted. In the remaining cases no renter satisfied the Board of Trade that the circumstances of non-compliance were outside his control, but the defaults were not considered sufficiently serious to justify a prose- cution. The companies concerned, however, were warned that they must not expect similar leniency in the case of any future default. VII. — -The Position of the Exhibitors. 53. The exhibitors are combined for trade associa- tion purposes in the Cinematograph Exhibitors' Association (secretary, Mr. iW. R. Fuller). 54. Under the Act every exhibitor showing films to which the Act applies is required to be in pos- session of an annual licence issued by the Board of Trade. This liability arises in respect of each cinema separately, and the licence is not transfer- able if the business changes hands during the course of a quota year. The numbers of licences issued by the Board of Trade to exhibitors in the course of the last three exhibitors' quota years have been as follows : — Year ended 3Qth September. 1933 4,&52 1934 4,766 1935 4,855 These figures include a number of new licences which were issued in the course of a year when premises Changed hands and the total number of cinemas normally open in this country may be taken at about 4,400. 55. As already pointed out, the Gaumont-British Picture Corporation control, through various associated companies, some 330 cinemas, and the Associated British Pictures Corporation some 225. None of the other British producing or renting con- * The number of defaults is a preliminary estimate and may be reduced by combinations of renters under Section 14. Tho defaults will be examined on the basis of the Renters' returns due on May 1st and will then be brought before the Advisory Committee as necessary. MINUTES OF EVIDENCE 5 May. 1930.] Mr. R. J>. Fennelly. [Com/.. cerns has, so far as is known, any financial interest iti cinemas. Among the foreign controlled renting organisations Paramount have a chain of about 12 theatres in key positions throughout the country, while several of the other companies control a theatre in the West End of London which serves as a shop window for their films. 56. Apart from the two major circuits referred to above there are several circuits of between 50 and 100 theatres and also a number of smaller circuits. In a few cases there are no financial arrangements between the companies constituting the circuit ; they are combined together for the purpose of booking films, presumably because their greater strength enables them to make better terms with the renters. The renters have now set their face against any extension of this practice. 57. The renter normally hires his films to exhibitors on a percentage basis, that is bo say, he takes a certain proportion of the gross receipts of the cinema after entertainment tax has been paid. The percentage charged varies with the type and popularity of the film — from 25-40 per cent., and even higher. Where a complete programme is taken from a renter the percentage is adjusted accord- ingly, but where the second feature is hired from a second renter it is usually paid for at a flat rate, e.g. £25 for a week. On the average, however, the renter probably takes between 35 to 40 per cent. oJ the gross receipts, less tax. 58. The following Table H shows the total length of registered films exhibited in Great Britain in each of the exhibitors' quota years 1932 to 1935: — Table H. Exhibitors' British. Foreign. Total. Year Statutory Quota. ending 30th Sept. Per cent. Short. Long. Total. Short. Long. Total. Short. Long. Total. (In thousand millions of feet.) 1932 ... 10 0-24 6-89 7-13 4-37 21-49 25-86 4-61 28-38 32-98 1933 ... 12± 0-20 7-90 8-10 3-80 22-20 26-00 4-00 30-10 34-10 1934 ... 15 0-24 9-22 9-46 3-59 23-21 26-80 3-83 32-43 36-26 1935 ... 15 0-17 9-40 9-57 3-85 24-10 27-95 4-02 33-50 37-52 59. The next Table I based on the figures given by exhibitors in the same years in comparison with above gives the percentages of British films shown the statutory quota: — Table I. Year ending Exhibitors' Statutory Quota. Actual Quota of British Films Exhibited. 30th September. All Films. Long Films. Short Films. 1932 1933 1934 1935 Per cent. 10 12i 15 15 Per cent. 21-60 •23 -70 26-09 25-51 Per cent. 24-27 26-20 28-42 28-07 Per cent. 5-13 5-26 6-28 4-21 Comparable figures for the years prior to 1932 are not available, but it will be observed that in each of the last four years exhibitors as a whole have slum n British films considerably in excess of their statutory obligations. It will also be seen that the quota in respect of long films is higher than that for all films. Where an exhibitor is working near to his quota limit he naturally tends to show more British long films in order to make up the deficiency in British short films. 60. It is often stated that the high proportion of British films shown by exhibitors as a whole is due to the fact that the figures are weighted by the high quotas of the two main circuits. This does not, however, seem to be the case. An examination of the returns furnished by the circuit theatres in respect of the quota year 1933-34 shows that their quotas were below the general average in that year. 61. It will be seen from Table I that after a period of three years during which the quota of British films exhibited tended to increase, there has been a slight fall in the year 1934-35 in the case of the all and long film quotas. The short film quota, which is not statutory, fell from 6-28 per cent, to 1-21 per cent. This decline in the exhibition of British shorts was apparently not due to any diminution in supply of such films, as the number H6452 of British shorts registered in the renters' quota year 1934-35 was 123 as against CO in the previous year. Quite a number of these films, registered for exhibitors' quota only, were of the " interest " and instructional type, while many were of a musical character. An examination of the returns made by exhibitors shows that at 1,600 theatres, or one-third of the total number, no British short films were exhibited. It is difficult to account for this decline. It may be due to the character of the films avail- able or to the increasing number of theatres which are now showing two long films, a news reel and sometimes a short comedy as a complete pro- gramme. 62. It may he of interesl in record the quotas for England, Scotland and Wales separately in respect of the exhibitors' quota year ended 30th Sep- tember, 1935. The figures are: — Country. Long Films Quota. All Films Quota. England ... Scotland ... Wales I'i r cent. 28-43 28-24 25-01 Pei- cent. 25-90 26-03 22-12 10 COMMITTEE ON CINEMATOGRAPH FILMS 5 May, 1936.] Mr. R. D. Fennki.i.y. [ ( toni 63. In spite of the striking figures shown above there are a considerable number of defaults amongst exhibitors every year. The following Table J shows the number of defaults amongst exhibitors in each of the quota years 1932 to 1935: — Table J. Quota Year ended 30th Sept. Total Defaults. Total in respect of complete year. Number of Prosecu- tions. 1932 1933 1934 1935* 130 149 179 147 29 30 69 71 2 2 10 1 * Note. — The Cinematograph Films Advisory Committee have not yet been asked to consider a number of defaults which occurred in 1934—35. 64. It will be seen that a large number of defaults occur in respect of only part of a year. These defaults occur particularly where theatres are opened late in the quota year and sufficient films of the right kind are not available, or where a business changes hands or is closed down in the course of the year. It should be explained that the quota liability attaches to the individual exhibitor and not to the cinema. 65. As compared with the number of theatres (4,400) the number of defaults is not large, especially when account is taken of those cases where for special reasons compliances with the Act would have been extremely difficult and in some cases impossible. No particular importance can be attached to the fact that there was a large increase in prosecutions in respect of the quota year ended September, 1934. 66. In the normal way after a film has been shown to the trade it is; not released for general exhibition to the public for several months, though some out- standing films are shown for a short period soon after the Trade Show in the West End of London. The date of the general release varies between the Provinces and London, and even between North and South London so as, no doubt, to economise in copies of films. In the first week of its general release the film goes to the " first run " houses in the area which have booked it and in the weeks thereafter to the " second run," " third run," etc., houses. 67. In general, defaults on the part of exhibitors are attributed to the difficulty of obtaining a sufficient supply of Brilisli films of m»id quality com- bined in some cases with the contention that in par- ticular areas of the country — in particular the Fast End of London and parts of Glasgow — British films jr.' not in the public favour. The difficulty of securing adequate supplies of good British films arises chiefly in those towns or districts where there a considerable number of " first run " houses in competition with one another, especially when- go of these bouse- belong to the main circuits. The circuit cinemas naturally show most, if not all, of the films made by their connected producing organi- sations and. through their booking power, are able to obtain other British films in competition with independent exhibitors who have only one or two cinemas. The number of British films available to the independent exhibitor is materially reduced and the residue left to him includes most of the films of poor quality. Even if he were prepared to show a particular film of good quality at the same time as his competitors, he is in many cases prevented from doing so by a system of " barring," that i-. his competitor has an arrangement with the renters that no other cinema within a certain area will be allowed to exhibit the film during the same period. This system of " barring " is also in existence be- tween " second run " houses and even in some cases a definite period is insisted on before a film can be shown " second run " in the competitive area. 68. As in the case of the renter, the exhibitor who is in default may make a submission to the Board under Section 23 (2) of the Act that non-compliance was duo to reasons beyond his control. Every case where the Board contemplate the refusal of such a certificate is referred to the Advisory Committee. A number of certificates are, in fact, granted every year. 69. It may be added that under Section 32 (2i of the .Vet, " where compliance on the part of a renter or exhibitor with the provisions of the Act as to quota was not commercially practicable by reason of the character of the British films available or the excessive cost of those films, non-compliance with those provisions on that ground shall for the pur- poses of the Act be treated as due to reasons beyond his control." VIII. — The Demand fob Bbitish Films. 70. It is common knowledge that the entertain- ment value of British films has consistently improved since the Act came into operation anil that they are #n general demand by the public, especially since the introduction of sound. The tables in paragraph 59 show the extent to which the exhibitors as a whole have exceeded their statutory obligations in the exhibition of British films. The object of the ex- hibitor is, of course, to give the public the type of films which it wants: and the fact that the statutory quota has been exceeded over each of the last four years is in itself a proof of public demand. 71. Further light on the demand for British films is shown by the following Table " K ". This Table shows the particulars, taken from the renters' statu- tory returns, of the range of bookings of long films acquired by renters in the years 1932-33 and 1933-34. Comparable figures for 1934-35 will not be available until the supplementary returns from renters due on 1st .May. I936j have been received and collated. Table K. Range in Days. British Films. For. ign Films. 1932-3. 1933-4. L932-3. 1933-1. 1 to 2,000 3.000 to 5,000 5.001 and upwards ... No. 50 75 34 Per cent. 31-6 47-4 21-0 No. 60 82 45 Per cent. 32- 1 43-8 24-1 No. lot 340 32 Per i ent. 21 -S 71- t 6-8 No. 101 341 43 Per cent. 20-8 7o-3 8-9 Total 159 187 47ii 485 MINUTES OF EVIDENCE 11 5 May, 1936.] Mr. R. D. Fennelly. [Contmi in J. 72. The Table shows that the number of British films which are booked tor 5,001 days and upwards was in excess of the number of foreign films so booked in each of the years 1932-33 and 1933-34. This comparison is even more striking when it is remem- bered that the number of foreign long films regis- tered is between two and three times as great as the number of British long films registered. It must, of course, be remembered that a large number of films in the higher range of bookings are those made by the British producers who have affiliated renting and exhibiting organisations and also that there is a certain demand for the good British films for quota purposes. 73. It will be observed that in the category of the lowest range of bookings (1 to 2,000 days) there is a larger percentage of British films than of foreign films. The British films falling within this class include a large number of films acquired by the foreign-controlled renters in order to meet their obligations under the Act. It is a constant com- plaint of exhibitors that a large proportion of the films acquired by these renters are of poor quality and that they do not offer a satisfactory booking proposition in the case of most cinemas. It is around this question of the quality of " quota " films that the chief controversy regarding the operation of the Act has arisen. 74. The quality of British films may be examined from another aspect. Reference has already been made in paragraph 51 to the markings assigned to films by the Cinematograph Exhibitors' Association Review. The Board of Trade have no means of judging whether the standard of marking is con- stant throughout a year or as between one year and another, and in the case of particular films the markings may perhaps be open to criticism. It may perhaps be assumed, however, that throughout the range they represent fairly accurate marking from the exhibitors' point of view. The scale of markings has already been described in the footnote to para- graph 51. 75. The following Table " L " shows in summary form the markings assigned by the Review to British films in the quota year 1932-33 and also in the calendar years 1934 and 1935. In the Table a com- parison is made between the British films registered by British renters and those registered by foreign- controlled renters. Full details of the markings of the films acquired by the different companies are given in Appendix VI. Table L. Quota year 1st April, 1932 Calendar Year 1st January Calendar Year 1st January Scale of Markings. to 31st March, 1933. to 31st December, 1934. to 31st December, 1935. British Renters. No. of films. Per cent. No. of films. Per cent. No. of films. Per cent. Under 7 7 9 7 9 2 2 7to7J: 5 7 3 4 6 7 7|to7f 5 7 16 21 22 26 8 to 8£ 38 51 41 54 52 60 8| and over 19 26 9 12 4 5 Total 74 100 76 100 86 100 U.S. Controlled Renters. Under 7 9 11 33 31 33 34 7 to 74. 16 20 32 29 29 30 7£to7f 18 23 29 27 19 20 8 to 81 33 42 12 11 14 14 8| and over 3 4 2 2 2 2 Total 79 100 108 100 97 100 76. Taking a marking of eight and above as the criterion of a good film, it will be seen that in the calendar year 1935, 56 out of 86 films regis- tered by British renters, as compared with only 16 out of 97 registered by foreign-controlled renters, fell within this category. Whether or not in con- sequence of some variation in the standard of mark- ing, the proportion of British films falling within this class has tended to fall on a comparison of the three periods ; but the fall has been consider- ably greater in the case of the foreign-controlled renters than in the case of the British renters. 77. Since the exhibitors' quota has increased to 15 and 20 per cent, the Board of Trade have re- ceived complaints from the exhibitors that they are unable to obtain sufficient British pictures of good quality and that in order to meet their obliga- tions under the Act they are forced to book British films of inferior quality and consequently with low earning capacity. The films registered in the year 1935 represent more or less those available to ex- hibitors during the quota year 1st October, 1935, to 30th September, 1936. Again on the assumption that a marking of eight and above represents a good film, it will be seen that the number of such lilms available to exhibitors was 72. Where an exhibitor shows two feature films in his programme and changes his programme once a week he re- quires, with a quota of 20 per cent., some 25 British long films after making some allowance to cover his deficiency in quota on foreign short films. Where the independent exhibitor is in competition with one or both of the producer-renter-exhibitor cir- cuits he has no opportunity of booking their films " first run " and his choice is therefore somewhal restricted, especially when allowance is made for the competition of smaller circuits or with other independents and for films which, although of good quality, do not suit particular localities. Too much stress should perhaps not be laid on these calcula- tions, especially as some of the films marked 71, ami ~i may be specially suitable for particular parts of the count i\ . 78. It is clear, however, that the tendency oi foreign-controlled renters has been to acquire cheaply produced British films in order to meet 3G152 B 2 12 COMMITTEE ON CINEMATOGRAPH FILMS 5 May, 1936.] Mr. R. D. Fexxelly. [Cont rwed. their obligations under the Act. Cost is, of course. not the only or even the best criterion of quality, but it is probably true that a good film cannot be produced for the amount of money these renters are prepared to pay. 79. The necessity for some quality test for British films was mentioned during the course of the Debates in the House on the Bill and many representations have been received by the Board of Trade on the subject since. In general, all these representations have the same basis, namely, that a film should have cost a certain amount of money in order to qualify for registration as British. It is generally admitted, as mentioned above, that cost is not the best criterion of quality, but it is argued that it is the only method administratively possible. Pro- posals on these lines were made in 1929 to the Board of Trade by a joint deputation from the Federation of British Industries and the Cinemato- graph Exhibitors' Association and were repeated in 1931 by a joint deputation from the Federation of British Industries and the Trade Union Congress. These proposals are discussed in the report of the Cinematograph Films Advisory Committee made in October, 1935, which is before the Committee. IX. — The Export Market. 80. Since the Cinematograph Films Act, 1927, was passed in this country legislation on somewhat similar lines has been introduced in various parts of the Empire. A summary of this legislation is given in Appendix VII. It will be seen that in New Zealand, Southern Rhodesia and certain Colonies the object of the legislation has been to increase the exhibition of British films. 81. In New South Wales and Victoria, however, the recent legislation has taken a different trend and its main object is to assist the promotion of film production in Australia. It is anticipated that this legislation may have repercussions on film pro- duction in the United Kingdom. Under the legisla- tion renters in business in Australia are under an obligation to acquire a certain proportion of Australian films against their foreign films though not against their British (other than Australian) films. Films made for this purpose in Australia, provided that they comply with the requirements of the Cinematograph Films Act, 1927, can also count for quota purposes in this country, and it is therefore to be expected that a certain number of films which would otherwise be made in this country for quota purposes will henceforth be made in Australia so as to satisfy both quotas at once. Objection has been taken to this legislation by the film producers in the United Kingdom on the ground that it does not provide reciprocal treatment, but presumably it was felt that if British (other than Australian) films were entitled to count for quota purposes in Australia in the same way as Australian films can count in the United Kingdom the object behind the Act was not likely to be achieved. So far as exhibitors are concerned, the situation varies in the two States. In New South Wales exhibitors have to provide a certain proportion of Australian iilius against all the films including British (other than Australian) which they exhibit, whereas in Victoria the obligation only applies in respect of foreign films exhibited. 82. Australia has hitherto provided the best market for British films outside the United Kingdom and so far us inn be judged Mich films are increasing in popularity. 83. In Canada, where, as in the case of Australia, films arc a matter for the separate Provinces, legis- lation imposing quotas has been passed in two provinces, but has noi been put into operation. The I ;ress of British films has been slower in Canada than in Australia, presumably owing to the hold which United States interests have over flu1 Canadian cinemas 84. There is no quota legislation in South Africa, the Irish Free State or India. 85. Colonies and Mandated Territories. — The posi- tion here requires more lengthy explanation. In March, 1929, the Secretary of State lor the Colonies appointed the Colonial Films Committee " to examine the arrangements existing for the supply .... of cinematograph films for public exhibition in the Colonies, Protectorates and .Mandated Terri- tories, and to consider in what way these arrange- ments could be improved, with special reference to . . . . the desirability, on political as well as economic grounds, of encouraging the exhibition of British films." 86. One of the recommendations made in the report of the Committee (Cmd. 3630) in July. 1930. was that an organisation should be set up in this country, independent of but working in close co-operation with the Government Departments concerned, to under- take the distribution of British films throughout the Colonial Empire. The Committee also recommended that this organisation, when established, should have the assistance of an advisory Committee nominated by the Government to assist in the selection of suit- able films for exhibition in the Colonies and to advise generally on questions relating to the distribu- tion of such films. It was not intended that this Committee should in any way replace the local censorship authorities who would still retain the responsibility for deciding what films could properly be shown in each of the territories concerned. 87. With a view to assisting in the establishment of this organisation, a number of Colonial Govern- ments, at the request of the Secretary of State for the Colonies, and in accordance with a recommenda- tion made by the Colonial Films Committee, under- took to guarantee the Company formed for the pur- pose against loss in its total transactions in the first year up to £1,000. 88. In order to give effect to the recommendations made by the Colonial Films Committee, the Film Producers' Group of the Federation of British Indus- tries formed in October. 1931, the British United Film Producers Company Limited, to undertake the distribution of British films throughout the Colonial Empire. This Company had on its Board of Direc- tors representatives of some of the principal film producing companies in Great Britain. At the same time the Secretary of State nominated as members of the Advisory Committee to assist the Company m the selection of suitable films, two ex-Colonial Governors, the technical adviser to His Majesty's Government on Cinematography, and a representa- tive of the Department of Overseas Trade. 89. The Company undertook the distribution of British films through local agents in the Colonies. and Colonial Governments were requested by the Secretary of State to afford to the Company and its agents such assistance as could properly be given. The Company shipped large consignments of British films to the West Indies and to West Africa. 90. Generally speaking, the Company were only able to cover those Colonial territories which were not already adequately served by existing arrange- ments for distribution; and as such arrangements increased in scope in the Colonial Empire, so the facilities for distribution of the new company diminished. There was no clause in its articles of association making it obligatory on the part of member firms to utilise its services. In consequence the character of the Board and shareholders changed in 1933 an.! 1931. so that by the end of the latter year the company had come under both the financial and directing control of the Gaumont-British Picture Corporation, Ltd. 91. Quota legislation exists in certain West Indian Colonies ami in British Guiana and has been con- sidered in connection with other parts of the Colonial EJoipire. but before any steps can be taken MINUTES OF EVIDENCE 13 5 May, 1936.] Mr. R. D. Fennelly. ( 'mi I iwued. the Colonial Office and the Colonial Governments concerned require to be assured that an adequate and regular supply of British films can be made available for exhibition in the territories concerned. It may be mentioned that the enactment of such legislation is not possible in the majority of the African Colonies owing to international treaties. 92. The revenue derived by United Kingdom pro- ducers from Dominion and Colonial sources is not substantial except in the case of Australia, but it is obviously necessary for the purposes of British prestige that good British films should be exhibited not only in the Empire but elsewhere in the world as widely as possible. 93* The budget of production costs of a film must obviously depend upon the market which is to be anticipated. In the case of a film produced in this country the main market at present is the United Kingdom, and producers can estimate with some degree of certainty the revenue to be expected from a particular type of film, provided it is well made, and can plan its production accordingly. There are, however, limits to the revenue which can be expected from the United Kingdom and this consequently sets an upper limit beyond which pro- ducers cannot afford to go unless they have some assurance of a market outside the United Kingdom. The exhibition of British films in the Dominions and Colonies assists in this respect, but it is often stated that the production industry in this country cannot take the next big step forward unless it can be certain of finding a market in foreign countries. particularly the United States. A certain amount of progress in this respect has been made in the last few years. The Gaumont-British Picture Cor- poration have started their own renting organisa- tion in the United States and arrangements are understood to exist which ensure the release to exhibitors in the United States of films of other British producers. 94. There is no restrictive legislation in the United States. Various Continental Governments have, however, taken steps to encourage the production of films in their own territories and a summary of the measures at present in force is given in Appen- dix VII. In general there is a tendency to regulate the exhibition of foreign films by quotas on imports; in some cases the local industry is assisted by loans and subsidies, while some countries require the " dubbing " of imported films, i.e., the re-making of the sound track in the language of the country concerned, to he carried out locally. X. — The Question of Sub-Standard Films. 95. The standard film used in the ordinary cinema is of a width of 35 mm. There are, however, other sub-standard films of widths of 16 mm. and 9 mm., which are largely used for educational, scientific anil similar purposes and in home cinemas. Cases have arisen recently, however, where sub-standard films (usually reproductions of 3-5 mm. films which have been registered under the Act) have been exhibited to the general public. The application of the Act to exhibitions of sub-standard films raises some awkward problems. For instance, the line between long and short films is drawn in the Act at 3,000 feet and this was clearly based on the 35 mm. film. The distinction on this basis has, however, little meaning in the case of 16 mm. and 9 mm. films. So far as the Board of Trade are aware, however, the exhibitions of sub-standard films of a registrable character to the public have only taken place in a few cases, but as such exhibitions may increase in number their place in any legislation appears to require consideration. 1. (Chairman): Mr. Fennelly has given us a very excellent summary of the position. It was mentioned last week that we should be glad of an outline of the objects of national film policy. That is not covered by this evidence and perhaps Mr. Fennelly would in that respect supplement wluu he has given us. He will remember that Sir Arnold Wilson as\e anc^ if would make it possible for the Board of Trade to keep a closer eve upon the operation of the Act than they can at present? — Tt would enable us to see what is happening abroad, I think. 13. Can you add to your evidence a statement showing the number of persons engaged in the various capacities as film producers, and in connec- tion with film production? — I will put in a state- ment, (b) but I can give some figures now. 44. Can we have the rough figures? — The latesl official information is in the 1931 Census. The occu- pation tables show 454 persons employed as film producers in film studios in England and Wales, and one in Scotland, making 455. The occupation tables du not show separately electricians, Ac employed in film studios. tlie\ are all classed under their occu- pation and not their actual employment. The in- dustry tables show that nearly 6,000 persons are employed in film producing ami film studios, of (b) Appendix IX. which 4,000 are males and 2,000 are females. The operative employees were 5,500. 15. (Chairman) : What is the date of these figures? — This is the 11)31 Census of Population. 46. (Sii A i il — i 1 1 o CD CO IQ m OS o .a H 1 CO 1 1 I I I I [ !-H t- pq 1 bb a o ►J H 1 1 1 1 1 1 1 1 rt 1 - CO 1 * CO ! CO CO OS 1— 1 4^ Li o to H 1 Li 1 "* 1 1 1 1 1 1 1 1 i* bb 0 0 h3 w 1 Ll pq |> l-H ~H OS CO CO J. CO OS o 43 H ° 1 1 1 I 1 1 1 1 lO Li pq 1*11111111 CO ti a o W 1 Li pq 00 I 1 I I i-l OS CO 1 co OS o J3 02 H 1 pq ~H ~ bio a o t-5 H 1 Li pq N I I 1 I •* | I 1 | co CO ci CO OS 13' o M 02 H I r-l 1 eo 1 1 1 1 1 | <* pq 1 1 I 1Q | 1 1 I I I o bb a o H III"* "• t-i pq CO | CO | os cS 2 os cn CS -e o 02 H 1 Li pq 1 be a o l-q w 1 pq CO *+ t- OS 3 «2 H i-H -H pq PH - bb a o h5 H 1 Li pq CO i 0-1 I 1 — i -h — I oc 1 c s i ) Australia Australia Canada Canada Federated Malay States. India Irish Free State Jersey South Africa ... Southern Rhodesia. 36452 26 COMMITTEE ON CINEMATOGRAPH FILMS 5 May, 1936.] \ r ,,,,;. : , | APPENDIX VI. United Artists Corporation, Ltd. (1 no marking) Other Foreign-controlled Renters — First National Film Distributors, Ltd. (1 no marking) Fox Film Co., Ltd. (1 no marking) Metro-Goldwyn-Mayer Pictures, Ltd. Paramount Film Service, Ltd Radio Pictures, Ltd. Universal Pictures, Ltd. (2 no markings) Warner Bros., Ltd.... Grand total Percentage . . Analysis of British Long Films registered during the Quota Year, 1st April, 1932, to 31st March, 1933, on the basis of markings assigned by the cinematograph exhibitors' association. C.E.A. markings. Major British Renters — British Lion Film Corporation, Ltd Butcher's Film Service, Ltd. Gaumont Films, Ltd. . . . ~) Ideal Films, Ltd > Gaumont group. W. & F. Films Service, Ltd. J Pathe Pictures, Ltd. P.D.C., Ltd Sterling Film Co., Ltd Wardour Films, Ltd. Other British Renters — ■ Ace Films, Ltd Associated Producing and Distribution Co. Equity British Films, Ltd. International Productions, Ltd. ... W.P. Films Co., Ltd Under 7. 7 to 7L 1\ to 7f. 8 to 8i, 8| & over. 1 ] — 1 1 1 3 — . — 1 2 3 — — — 12 7 3 1 2 1 1 — — 1 1 3 15 5 4 3 4 37 19 6% 4% 6% 54% 30% 1 — — — 1 — 3 1 — — — — 1 — — 3 2 1 1 — 43% 29% 14% 14% — — — 2 6 — — — 25% 75% — 2 3 2 2 — 1 7 1 3 3 1 1 — — 5 6 1 — 1 2 6 1 5 3 — 3 1 7 2 2 — 9 16 16 27 3 12% 23% 23% .->s 4% 16 21 23 71 22 11% 14% 15% 46% 14% APPENDICES 27 5 May, 1936.] [ I 'nil I APPENDIX TL— continued. Analysis of British Long Films registered during the period 1st January to 31st December, 1934, on the basis of markings assigned by the cinematograph exhibitors' association. Major British Renters — Associated British Film Distributors, Ltd. British Lion Film Corporation, Ltd. Butcher's Film Service, Ltd. Gaumont- British Distributors, Ltd. (1 no marking) Pathe Pictures, Ltd. P.D.C., Ltd Wardour Films, Ltd Other British Renters — Associated Producing and Distribution Co. Beacon Film Distributing Co Equity British Films, Ltd. (1 no marking) International Productions, Ltd Zenifilms, Ltd United Artists Corporation, Ltd. Other Foreign-controlled Renters — ■ Columbia Picture Corporation, Ltd. First National Film Distributors, Ltd. (1 no marking) Fox Film Co., Ltd Metro-Goldwyn-Mayer Pictures, Ltd. ... Paramount Film Services, Ltd Radio Pictures, Ltd. Universal Pictures, Ltd. (2 no marking) Warner Bros., Ltd Grand total Percentage O.E.A . Marl mg. t. Under 7. 7 to 1\. 7i to 7|. 8 to U. 8| over. 1 4 1 2 2 2 3 1 1 1 3 3 2 16 6 1 11 1 5 3 5 3 13 39 9 7% 4.0/ */o 19% 57% 13% I 1 — 1 2 1 1 — 2 — 3 2 — 28% — 44% 28% — — — 2 4 2 — — 25% 50% 25% 7 5 3 7 4 1 1 5 3 1 3 7 7 6 2 3 1 1 4 4 5 G 5 2 1 1 1 1 3 1 — 33 32 27 8 — 33% 32% 27% 8% — 40 35 45 53 11 22°/ "" /o 19% 24% 29% 6% 3(5452 D 2 28 COMMITTEE OX CINEMATOGRAPH FILMS 5 May. 1936.] [Continued. United Artists Corporation, Ltd. Other Foreign-controlled Renters — Columbia Picture Corporation, Ltd. (1 no marking) First National Film Distributors, Ltd. ... Fox Film Co., Ltd Metro-Goldwyn-Mayer Pictures, Ltd. (2 no marking) Paramount Film Service, Ltd. Radio Pictures, Ltd. Universal Pictures, Ltd. (1 no marking)... Warner Bros., Ltd Grand Total Percentage APPENDIX VI. {continued). Analysis of British Long Films registered during the period 1st January to 31st December, 1935, on the basis of markings assigned by the cinematograph exhibitors' association. C.E.A. Markings. Major British Renters — Associated British Film Distributors, Ltd. British Lion Film Corporation, Ltd. Butcher's Film Service, Ltd. Gaumont-British Distributors, Ltd. General Film Distributors, Ltd. ... Pathe Pictures, Ltd. (1 no marking) P.D.C., Ltd Twickenham Film Distributors, Ltd. Wardour Films, Ltd. Other British Renters — Ace Films, Ltd Associated Producing and Distribution Co. Equity British Films, Ltd. (1 no marking) Reunion Films, Ltd. Under 7. 7 to 1\. 1\ to 7|. 8 to 8£. 8| & over — . 2 1 1 2 7 5 1 — 5 — — 5 2 21 1 2 3 — 1 1 1 4 1 4 9 1 — 5 20 51 4 — fi0/ % 25% 64% 5% 1 1 1 — 2 — — 1 — — — 2 1 2 1 — 33% 17° 11 /o 33% H% — — — — 6 2 — — — •°/o 25% 4 2 — 1 2 3 — 2 4 5 1 — 8 4 — — — 4 6 3 — — 6 7 2 1 — 8 4 5 1 — 1 1 2 2 — 33 29 19 8 — 37% 33% 21% qo/ v /o — 35 35 41 66 6 19% 19°' li* /o 23% 36% 3% APPENDIX VII. Legislation relative to the production, renting and exhibiting of cinematograph films in parts of the British Empire outside the United Kingdom and in foreign countries. British Empire. (a) Australia — New South Wales and Victoria. — In New South Wales the Cinematograph Films (Australian Quota) Act, 1935, received the Governor's assent on the 11th April, 193.5. In Victoria an Act having the same title received assent on the 2nd December, 1935. In the main the two Acts are in identical terms. They impose quotas on distributors (renters) and exhibitors for periods of five years with the object of fostering film production in Australia. The following notes apply to both Acts except as otherwise stated. Films to which the Acts apply. — For quota pur- poses films to which the Acts apply are divided into Australian, British and foreign films. An Australian film is defined as a film: — (a) which has been wholly or mainly produced in Australia ; (b) all the studio scenes depicted in which have been photographed in Australia: and (c) (where the film is produced by a company) which has been produced by a company in- corporated in Australia. British films are films which are deemed to be British films under the Imperial Cinematograph Films Act, 1927, and foreign films are all films which are neither British nor Australian. Nine classes of films are excepted from the Acts. The first six classes are identical in terms with those enumerated in Section 27 (1) of the Cinematograph Films Act, 1927. In addition the Acts do not apply to: — (1) films not exceeding 5.000 ft. in length; (2) Australian films rejected by the Minister on the advice of the appropriate advisory autho- rity on the ground that their artistic or photo- graphic merit, or their appeal to the interest of APPENDICES 29 5 May, 1936.] [Continued. the public generally, or their general quality is not sufficient to warrant their being taken into account for quota purposes ; (3) Australian films, the production of which was commenced before the 1st January, 1934. In New South Wales the Act may be applied to any specified Australian film of any of the excepted classes provided that the film is not less than 3,000 ft. in length. In Victoria the Act may be applied to any speci- fied Australian film of any of the excepted classes except films depicting news and current events or being commercial advertisements, subject to the pro- viso that quotas may not be satisfied by single reel films to a greater extent than 25 per cent. Advisory Authority. — The New South Wales Act provides for the appointment by the Governor of a Films Advisory Committee of three persons having no pecuniary interest in any branch of the firm industry. Members, unless employed by the State of New South Wales, are entitled to receive fees for their services. The Victoria Act provides for the appointment by the Governor of a Films Adviser remunerated by fees. Distributors' Quota. — The prescribed quotas in both Acts are : — Per cent. In the first year ... ... 5 In the second year ... ... 1\ In the third year ... ... 10 In the fourth year ... ... 12^ In the fifth year ... .., 15 The quota is calculated upon the numbers, not footages, of the Australian and foreign films acquired, i.e., distributors are not required to provide quota against British films. Where the prescribed per- centage is not a whole number any fraction exceed- ing a half counts as a whole number. The statutory quotas may be modified or waived by the Minister if he is satisfied that compliance by an individual distributor or by distributors generally is not commercially practicable by reasons of the quantity, character or exhibition value of Australian films available, or the excessive cost of such films in relation to British or foreign films. Small renters, each of whom acquires not more than six quota films in a year, may, with the consent of the Minister, combine for quota purposes. Distributors are required to furnish to the Minister statements in writing showing the number of quota films which they propose to acquire and distribute " during the next succeeding year." The maximum penalty for non-compliance, unless due to reasons beyond the distributor's control, is £100, and if the Court is of opinion that the offence was committed with the intent to defeat the purposes of the Act it may suspend or cancel the distributor's registration. Exhibitors' Quota. — The prescribed quotas under both Acts are : — Per cent. In the first year ... ... 4 In the second year ... ... 5 In the third year 7$ In the fourth year ... ... 10 In the fifth year 12^ Tn New South Wales the quota is calculated upon the total number of films (Australian, British and foreign) exhibited multiplied by the number of times of exhibition. In Victoria, however, the quota is calculated upon the total number of Australian and foreign films exhibited similarly multiplied. Accord- ingly the New South Wales exhibitor is required to exhibit Australian films as quota against British as well as foreign films, while in Victoria he is required to find quota against foreign films only. There are provisions, similar to those relating to the distributors' quota, in respect of the counting of fractions, the modifications either individually or generally of the quota, returns and penalties for non- compliance. Under both Acts an exhibitor, in order to comply with the quota, may, without incurring any liability for breach of contract, reject any foreign films which he has contracted to exhibit up to the number of the Australian films which he is required to exhibit in any year. In addition the Victoria Act provides : — (1) that a dispute as to the price to be paid for an Australian film shall be referred by the Minister to the arbitration of a committee of three, consisting of the Under-Secretary (Chair- man) and two other persons nominated respec- tively by the parties to the dispute. The Com- mittee's decision is final; (2) the exhibitor may, without incurring any liability for breach of contract, reject up to 25 per cent, of the number of foreign films which he has contracted to take. Notice of objection must be given to the distributor concerned within specified time limits. Under both Acts any agreement which requires an exhibitor to hire British or foreign films as a con- dition of hiring an Australian quota film is declared void. Also, any Australian film .which has been approved as a quota film in any other State is, unless otherwise directed, deemed to be an Australian film for the purposes of each Act. (b) New Zealand. — In New Zealand a Cinemato- graph Films Act was passed in 1928 to assist the distribution of British films in that Dominion. It did not purport to assist the establishment of a local film producing industry. Accordingly it differs in some respects from the Imperial Act of 1927 and also deals with matters which are outside the scope of that Act. It does not prohibit blind booking or so strictly limit advance booking, but it gives exhibitors certain rights to reject films without penalties for breach of contract. Provision is made for renters' and exhibitors' quotas. The quotas are based on numbers, not footage, of long films only. Renters may be exempted from the obligation to acquire British films if exhibitors are not prejudiced thereby and the exhibitors' quota is not mandatory. The Act also deals with censorship and safety regu- lations in connection with the storage, transport and production of films. The New Zealand Cinematograph Films Amend- ment Act, 1934 provides, among other things, that a standard form of contract between renters and exhibitors shall be prescribed or approved by the Minister and increases exhibitors' rights to reject films up to 25 per cent, in respect of all contracts for more than four pictures. The Act also imposes restrictions on the hire of films by exhibitors. It is made an offence for an exhibitor to hire more films than are necessary for his theatres. Rejection rights must be exercised within specified time limits. Renters are required on request to rent to any exhibitor on the usual terms and conditions any films rejected by or not already booked to another exhibitor in the same area. (c) Southern Rhodesia. — In Southern Rhodesia the Entertainments Control and Censorship Act of 1932 deals with safety in theatres and cinemas and the censorship of films and film advertising, and amongst other things, also imposes a quota of British films on exhibitors. The definition of British films corresponds with that in Section 27 (3) of the Cinematograph Films Act, 1927, the quota applies bo long and all films and is calculated in precisely the same way as the exhibitors' quota in Great Britain and exhibitors are required to keep records and furnish returns. The quota was fixed at 15 per cent, for the year ended 30th May, 1933, and for the five succeeding years at such proportion not being less than 15 per cent, as the Governor might pro- scribe. For each of the succeeding three years the quota has been continued at 15 per cent. In 1935 an amending Act provided that the quota provisions <>l the principal Act should not apply to silent films. 30 COMMITTEE ON CINEMATOGRAPH FILMS 5 May, 1936.] I on t; i, in d. (d) /}/■/'/ ;.s/i West Indies.— At the British Wesl Indies Conference in 1929 the question of the exhibi- tion of British films in the British West Indies was discussed and a resolution was passed recommending the Governments of the Conference Colonies to pa legislation, if and when practicable. to provide for the exhibition of a proportion of British films. It was further agreed that Trinidad should undertake the drafting of a measure to establish a quota system. (i) Trinidad. — As a result, the Trinidad Cinemato- graph (British Films) Ordinance, 1932, was passed. The Ordinance applies to all films except commercial advertising films, educational films, films consisting only of announcements, etc., not accompanied by pictorial illustrations, and films exhibited at per- formances where the total length of film does not exceed 2,000 feet. Quotas are imposed upon exhibi- tors only and must be satisfied as respects long films and all films and also as respects news films. Long films are films of 5,000 feet and upwards (as compared with 3,000 feet and upwards in Great Britain) and news films are films depicting wholly or mainly news and current events. Quotas are calculated upon the total number of feet of the films exhibited but no film is counted more than once, i.e., upon the footage of films booked without regard to the num- ber of exhibitions after the first that may be given. Quotas w7ere fixed at 20 per cent, for long and all films in 1933 and 23 per cent, in each succeeding year, and at 50 per cent, for news films from 1933 onwards. The Governor may also prescribe that not exceeding one-fifth of the percentage of British news films shall be British West Indian films and may regulate the price to be charged for such films. Exhibitors are required to keep records and to make returns and provision is made for penalties for contravention of the Ordinance. In 1935 an amending Ordinance gave the Governor power by proclamation to apply the principal Ordinance only to such towns or other areas as might be specified in the proclamation. It also pro- vided that the proportion of British films should be ascertained in such manner as might be prescribed. In consequence of representations by the film in- terests concerned that the quotas were excessive the Ordinance is not being enforced pending considera- tion of this question. (ii) Bahamas. — In 1933 the Bahamas House of Assembly rejected a Bill which was similar to the Trinidad Ordinance of 1932. (iii) British Ghiiana. -- Barbados. — Legislation similar to the Trinidad Ordinance of 1932 was passed in British Guiana in 1933 and in Barbados in 1935. As in Trinidad, these are not being enforced pend- ing reconsideration of the prescribed quota per- centages. (iv) Jamaica. — The question of quota legislation was considered in Jamaica in 1933, but no action was taken as voluntary arrangements which had been made for the exhibition of British films were regarded as satisfactory. Foreign Countries. (a) Austria. — Regulations in connection with two Austrian laws. Nos. 2114 and 206 of the 9th and 28th March. 1931. respectively, were issued to the trade by the Ministry lor Commerce and Traffic in Decem- ber, 1935. According to these regulations. Austrian makers of sound films receive as premium for each film produced, vouchers entitling them to a number of permits lor showing sound films. These vouchers are handed by tile producers to the " Film Bureau " of the Vienna Chamber of Commerce, where they are sold lor t lie account of the producing firm to the film dealers at 500 to 1,000 Schillinge each. Xo permits for exhibiting sound films are given, unless such vouchers are produced, [n certain eases no permits are required, e.g., lor cultural films, and Austrian weekly reports, which must be shown in any event. Xo vouchers are required when applying for permits to exhibit Austrian films, or foreign " Actualities." For foreign advertising films, pro- paganda films, etc., vouchers are required. One voucher gives a right to ten permits to exhibit a foreign short film, not exceeding 350 metres, or five permits for foreign films from 350 to 700 metres. In the case of foreign films above 1,500 metres, three vouchers must be produced; for each film of from 1,000 to 1,500 metres, two vouchers, and for films from 700 to 1,000 metres, one voucher. A reduction in the number of vouchers required can be granted when it has been necessary to make a (o rman rendering of a foreign language. For every normal film produced in the country, vouchers up to a maximum of twenty-five can be iss 1. and for short films or for films for obligatory exhibition, up to three vouchers. If normal films are produced on apparatus of Austrian make, four more vouchers may be granted. The maker of a version in a foreign language of a film originally made in Austria, is entitled to the free exhibition in Austria of one film made in the country to which the film in a foreign language is first sold. If such Austrian films with tourist foreign text serve as tourist propa- ganda for Austria, this benefit is increased. Rent- ing establishments who can prove expenditure in Austria for subsequent synchronisation of a film, may be granted up to two vouchers. Moreover, such films can be freely exhibited in Austria. If the maker of an Austrian film sells that film to foreign countries at an adequate price, or other- wise disposes of the film in a foreign country, the " Film Bureau " is authorised to issue a number of special export premium vouchers to be fixed by the Ministry of Commerce and Traffic. These vouchers remain with the " Film Bureau " and can only be used for exhibiting films which come from the same foreign countries. This applies only one for every original film. The Austrian film industry is not assisted in any other way by the Government, and no bounties on production are paid by the Government direct. (b) Czechoslovakia. — The Chechoslovakian film in- dustry is assisted by subsidies from a fund obtained from registration fees on imported full length feature films. The Czechoslovak Association of Film Industry and Trade is required to keep three registers (A. B and C). in which are entered particulars of all films imported or produced in Czechoslovakia. In these registers are entered respectively particulars of (A) all films produced in Czechoslovakia whose makers apply for a subsidy, (B) all imported full length feature films, (C) all other imported films (short films, etc., not exceeding 700 metres in length). To cover the expenses of registration the following "manipulation fees" are charged: — For each entry in Registers A and B, Kc. 200. For each entry in Register C, Kc. 20. In addition, for each entry in Register B, a registration fee of Kc. 20,000 is payable. Import licences are issued only on production of proof that the films concerned have been registered and the appropriate fees paid. The registration fees on " B " films provide a fund for the purpose of subsidizing the national production of feature films, and educational and propaganda films, and generally of promoting the national film industry. A Czechoslovak film must be in the Czechoslovak language and have been made in studios and labora- tories within the country. Before production is commenced the scenario of the film must have been submitted to and approved by the Film Advisorj Board. The importation of seven films entitles the im- porter to a subsidj of Kc.l lO.(HK) for the purpose of producing, or purchasing, at his option, a Czecho- slovak film. The subsidj is increased by a Further Kc. 10.0(H) il the native film acquired is made also in APPENDICES 31 5 May, 1936.] [Contin ut 'I . a foreign language for export. Post-synchronised and dubbed pictures are not regarded as foreign language versions. The importation of eight films entitles the im- porter to import, free of the prescribed registration fee, one film dubbed in a foreign language, the in- ternal distribution of which is, however, strictly controlled. On the importation of five films the importer is required to undertake to produce or purchase one native cultural film, 250 to 300 metres in length, in the Czech language, of which four copies must be supplied at cost price to the Ministry of Foreign Affairs (presumably for distribution abroad). (c) France. — The exhibition of foreign films in the language of the country of origin is allowed only in five cinemas in the Department of the Seine and in ten cinemas in other Departments of the country. During the period 1st July. 1935, to 30th Juno. 1936. post-synchronised films exceeding 900 metres in length, to the number of 94 in each half-year, may be exhibited in France subject to the following conditions : — (1) The post-synchronisation must have been entirely effected in studios situated in French territory and within four months from the date of entry of the application as detei mined by the payment of the appropriate tax. (2*) The film^ as exhibited to the public must be described as dubbed films and there must be shown the title in the original language, an exact translation of that title, the title of the dubbed version, names of the artistes concerned in the original production and in the post- synchronisation, the country of origin and the place in which the dubbing was carried out. The exhibition of foreign films from countries where the exhibition of French films is subject to restrictions is subject to any agreements made with the governments of those countries. This condition does not appear yet to have been strictly applied. Apart from these restrictions, the exhibition of foreign films is subject to the same conditions as to censorship, etc., as French films. The quota of post-synchronised films is not allotted to specified countries in fixed proportions. (d) Germany. — The importation of long sound feature films into Germany is limited to 105 in a calendar year. Import permits for these films are allotted as follows : — 60 (i.e., 4/7) to distributors of German films. These permits are issued free of charge but are not transferable and therefore can be used only by the distributors concerned. 30 (i.e., 2/7) to film exporters. These permits are transferable, as the majority of the film makers who would be entitled to them would have no use for them. The Ministry of Propaganda has fixed a price of 20,000 P.M. per permit as from 1st January, 1935. The remaining 15 permits are at the disposal of the Ministry of Propaganda. Long silent feature films are similarly restricted, the annual quota being 70. The Ministry of Propaganda has power to issue further permits " in the event of an important change in the position of the film market or for other im- portant reasons," or in respect of films to be imported from countries witb whom or with whose industries reciprocal agreements exist concerning film imports, " for political or cultural reasons." (e) Hungary. — Under a decree dated loth May, 1932, a Hungarian Film Industry Fund was estab- lished to further the development of the Hungarian Film Industry. The income of the Fund is obtained from the issue of " Importation Vouchers " and from additional censorship fees on certain films. An importation voucher must be obtained from the Fund in respect of each imported sound film at the following charges : — gold pengo. Each film not exceeding 200 metres ... 100 Each film exceeding 200 metres, but not exceeding 400 200 Each film exceeding 40O metres, but not exceeding 800 ... 400 Each film exceeding 800 metres, but not exceeding 1.200 1.000 In addition to the regular censorship lies addi- tional fees are payable on imported silent and sound films : — per censored metre. If the Hungarian captions have been made in Hungary ... 20 filler. If the captions have been made abroad ... ... ... ... 1 gold pengo. Importation vouchers are not required in respect of imported silent films, and news, educational, scientific and propaganda films are exempt from all the above-mentioned special charges. The National Board of Film Censorship issues its licence in respect of an approved film only on pay- ment of the special additional fee and production of an importation voucher. The film industry may, with the approval of the Ministers of Commerce and Home Affairs, grant premiums on films made in Hungary in proportion in each case to the capital invested in the film. Fnder decrees issued in July, 1935, an Act for safe- guarding the maintenance of the Hungarian language in sound film exhibitions was brought into force on l>t August, 19:3-5. These decrees provide for the issue in respect of each approved sound film exceeding 1.20O metres in length produced or synchronised in Hungary in the Hungarian language of " Censor's Tickets " (seven during the 1935-6 season). Each Censor's Ticket per- mits the examination by the Censorship Committee of one foreign film exceeding 1.200 metres in length. Quotas for half-yearly periods are fixed for exhibi- tors whose cinemas are equipped for sound projection. During the half-year 1st August, 1935 — 31st January. 1936, each licensed cinema proprietor was required to include in his programmes 101 per cent, of Hun- garian sound films exceeding 1,200 metres in length of which one-half might consist of films synchronised in Hungary in the Hungarian language. For the half-year 1st February, 1936, to 31st July. 1936, the corresponding proportions are 15 per cent, and two-thirds. Police authorities are required to see that these requirements are complied with and to submit half- yearly reports on the subject. Provision is made Eoi the withdrawal of licences from defaulting exhibitors. (f) Italy. — Under a Decree Law of the 8th October. 1933, as amended by several later Laws. non-Italian fiction sound films of not less than 1,000 met res dubbed into Italian, may be exhibited only if the dubbing has been carried out in thai country in establishments situated in Italy, by artistic and 32 COMMITTEE ON CINEMATOGRAPH FILMS 5 May, 1936.] [Continued. executive staffs consisting wholly of Italian subjects. A dubbed film must show at what place the dubbing was carried out and that the work was done in Italy. Persons carrying out in Italy dubbing of a foreign sound film must pay a tax of 26,000 lire on each such foreign film for which a permit to exhibit has been issued. Makers of native films dubbing foreign sound films into Italian are exempt from this tax if for three adaptations of foreign films they pro- duce and show one national film. The conditions to be complied .with by an Italian film are : — (a) the subject must be by an Italian author or must at least have been adapted for the Italian production by Italian authors ; (b) the majority of the artistic and executive staffs must be of Italian nationality; (c) both outdoor and indoor scenes must be taken in Italy. Certain exceptions may be made in respect of outdoor scenes according to the special requirements of the story. From and including the financial year 1933-4, 2,000,000 lire has been provided in the Budget of the Ministry of Corporations for the payment of prizes to national films considered as having artistic- merit and good technical execution. In first and second run cinemas in towns having a population of more than 50,000 inhabitants one Italian fiction sound film of not less than 1,500' metres must be shown for every three non-Italian sound films. At least three Italian films must be shown in each quarter of the year. The Under-Secretary for Press and Propaganda is authorised to vary the percentage of foreign to Italian films in accordance with the development of the national industry. The charges for and conditions of renting [talian films must not be less favourable than those of foreign films >if equal importance and Italian and foreign films must not be rented in the same contract. Under a law dated 13th June, 1935, the Under- Secretary of State for Press and Propaganda is authorised to grant loans to Italian film makers. An application for an advance must be accom- panied by financial, artistic and technical details of the proposed film. Applications are considered, and the amounts of the advances to be granted are fixed, by a Com- mission of five members, subject to the approval of the Under-Secretary of State. Provision for loans to film makers is to be made in the estimates of the Ministry of Finance up to a maximum of 10 million lire a year for five years from and including 1935-36. Provision is also made for the establishment of a cinema credit department at the Banca Nazionale del Lavore for the purpose of granting loans at particularly favourable interest rates to makers of films. The capital to be provided for this purpose is to be not less than that provided by the Ministry of Finance for similar purposes. (g) Poland. — The principal measures at present in operation in Poland for the protection and pro- motion of the film industry are: — (a) a high customs duty on imported films ; (b) strict censorship in respect of foreign films; (c) very high municipal tax discrimination between foreign films and Polish films making up the programmes of cinemas. A Film Law of 13th March, 1934, empowers the Council of Ministers to regulate the importation of films, but this power has not been used. The law also provides for the grant of subsidies to local filiu production from the fees payable for exhibition permits. This power also has not yet been exercised. A decree of the 18th August, 1934, made under the law requires the registration of undertakings for the sale and lease of films. A further decree of the 12th September, 1935, under the law established within the Ministry of the Interior (a) a Film Commission and (b) a High Film Commission. The function of these Commis- sions is to examine any films and advertising matter relating to them which may be submitted to them by the Ministry of the Interior. The Commissions do not take the place of the ordinary Film Censor- ship Committee. Proposals are reported to be under consideration (a) for a municipal tax on films, the maximum rate of tax not to exceed 60 per cent, and on films with a Polish theme, 5 per cent, of the price of the ticket, with a special rebate to cinemas undertaking to show annually at least 10 per cent, of Polish films exceeding 1,500 metres in length, in which case the tax on foreign films would be 45 per cent. In otber towns than WarsaAV lower rates would be applied to foreign films, dependent on the number of inhabi- tants; and (6) for a special tax on imported films to provide a fund for the encouragement of local pro- duction. APPENDIX VIII. 1. The following table shows the import duties at present in force on cinematograph films:- Class or Description of Goods. Rates of Duty. Full. Preferential Cinematograph Films imported for the purpose of the exhibition of pictures or other optical effects by means of a cinematograph or other similar apparatus: Blank film, on which no picture has been impressed, known as raw film or stock, including photo- graphic sensitised sheets or strips of celluloid or other similar material of a length of not less than twelve feet, whatever the width. Positives, i.e., films containing a picture for ex- hibition, whether developed or not Negatives, i.e., films containing a photograph, whether developed or not, from which positives can be printed 1 1 | per linear foot of }- the standard | width of If inches 1 J >> £ s d. 0 0 01 0 0 1 0 0 5 £ s. d. 0 0 0| 0 0 0$ 0 0 3i APPENDICES 33 5 Ma y, 1936.] ! 2. In certain circumstances imported negative cinematograph films are chargeable with duty as blank film. Details are as follows: — (1) If it is proved to the satisfaction of the Commissioners of Customs and Excise as respects any imported negative cinematograph film, whether developed or undeveloped, (i) that the production of the film was organised by persons whose chief, or only, place of business was in the United Kingdom, and (ii) that the producer of the film and all the principal actors and artists employed for the production thereof, except five, or if the total number of the principal actors and artists is less than twenty, not less than three-quarters of the principal actors and artists were British subjects and domiciled in the United Kingdom. that film is, subject to compliance with such conditions as the Commissioners may by Regu- lation prescribe, treated for the purpose of the above duties as being blank film. The expres- sion " artists " includes the person working the photographic camera by means of which the pictures composing the film are taken. (2) Negative cinematograph films which are certified by the Board of Trade to satisfy the requirements of Section 27 (3) of the Cinemato- graph Films Act, 1927, and parts of any films so certified may, subject to compliance with such conditions as the Commissioners of Customs and Excise may by Regulation prescribe, be treated as if they were blank film. Briefly stated, the requirements of the section are that the film must have been made by a British subject or company; the studio scenes must have photographed within the British Empire; the author of the scenario must have been a British subject; and a prescribed percentage of the salaries and wages spent in the production must have been paid to British subjects. 3. Certain scientific and educational films. whether positive or negative, are exempt from duty. Details are as follows : — (1) Any cinematograph film which is certified by the Royal Society of London for promoting Natural Knowledge to be solely an illustration of scientific investigation for exhibition before members of a recognised scientific body and which is imported only for the purpose of such exhibition free of charge is exempt from this duty. (2) Customs duties arc not chargeable on imported educational cinematograph films which are certified by the Board of Education under Section 7 of the Finance Act, 1935. The expres- sion " cinematograph film " for the purposes of the section mentioned means a developed negative or positive cinematograph film and includes both a gramophone record or other form of sound reproduction complementary to such a film and a developed negative or positive sound track. APPENDIX IX. Employment in the Film Producing Industry. The only official information available concerning the number employed in the film producing industry is that contained in the Census of Population taken in 1931. The Occupation Tables in connection with that census show 454 persons employed as film producers or film studio managers in England and Wales and one in Scotland. The Industry Tables show a total of 5,963 persons employed in film producing and film studios in England and Wales. These are subdivided into 3,961 males and 2,002 females, and are also subdivided into : — Employers, directors, managers, 439 — 416 males and 23 females — of whom 297 were branch and departmental managers; Operative employees, 5,457- -3.496 males and 1,961 females ; and Working on mm account, 67 — 49 males and 18 females. The above figures are exclusive of 675 persons who were out of work when the census was taken. These are subdivided into 516 males and 159 females. The total number of persons employed in film pro- ducing and film studios in Scotland was 65 — 3!) males and 26 females. The above figures do not include the artistes and persons employed on crowd work. There have been considerable developments in the film production industry in the United Kingdom since 1931 and it may be assumed that at the present time employment is substantially greater than is shown by the above figures. APPENDIX X. Films registered under Provisos (i) and (ii) to Section 27 (1) or the Cinematograph Films Act, 1927. 1. Under Section 27 (1) of the Act it is provided that the Ait applies to all cinematograph films, other than — (a) films depicting wholly or mainly news and current events ; (b) films depicting wholly or mainly natural scenery ; (c) films being wholly or mainly commercial advertisements; 36152 (d) films used wholly or mainly by educational institutions for educational purposes; (e) films depicting wholly or mainly industrial or manufacturing processes ; (/) scientific films, including natural history films. 2. Under proviso (i) to the Section the Board oi Trade are authorised to register for full quota films_ falling within anj of the excepted classes having regard to their special exhibition value. Before p.,, lung a decision in such cases it is the prac of the Hoard to consult the Cinematograph Films Advisory Committee. The following table shows the number of films which have been registered under this proviso since the Act came into force: — K 34 COMMITTEE ON CINEMATOGRAPH FILMS 5 May, 1936.] [Continued. Renters' Number of films registered. quota year. Long. Short. 1928-29 8 (1 serial) 1929-30 2 8 (1 group) 1930-31 2 6 (1 series) 1931-32 1 1 1932-33 2 4 (1 series) 1933-34 2 6 (1 series) 1934-35 1 6 (1 series) 1935-36 4 14 (1 series of 6; 1 group of 8) Total 14 53 3. Under proviso (ii) to the Section any film being a British film and falling within class (b), (d), (e) or (/) of the excepted classes can be registered for the purposes of the exhibitors' quota only. That is, the renter who acquires the film for distribution cannot count it against any foreign films which he acquires. but the exhibitor who shows it can count it against any foreign films which he shows. The following table shows the number of films which have been given E registration since the Act came into force: — Year. 1928-29 .. 1929-30 .. 1930-31 .. 1931-32 .. 1932-33 .. 1933-34 .. 1934-35 .. 1935-36 .. Total Short. 1 16 Nil Nil 3 29 1 16 3 32 5 12 1 56 3 46 17 207 It will be observed that the registrations under this head are mostly confined to short films and that there has been a tendency for the numbers to increase. SECOND DAY. Tuesday, 12th May, 1936. PRESENT : The Rt. Hon. Lord MOYNE, D.S.O. (Chairman). Mr. A. C. CAMERON. M.C.. M.A. Mr. J. S. HOLMES, M.P. Dr. J. J. MALLON. LL.D., J. P. The Hon. ELEANOR M. PLOIER. Lt.-Col. Sir ARNOLD WILSON, K.C.I.E.. C.S.I., CMC, D.S.O.. M.P. Mr. W. H. L. PATTERSON (Secretary). Mr. F. W. Baker, Mr. M. N. Kearney, Mr. A. Korda, Mr. N. Loudon. Captain the Hon. R. Norton, representing the Film Producers' Group of the Federation of British Industries, called and examined. The Committee had before them the following memorandum of the Film Producers' Group: — Foreword. In connection with the various observations and recommendations contained in this memorandum, a brief explanation of the scope and functions of the several sections of the British Film Industry may be of use to the Committee of Inquiry set up by the Board of Trade. The Film Industry, so far as theatrical or enter- tainment films are concerned, is divided into three " ".-. sections, namely. (1) Producers, (2) Renters (or Distributors), and (3) Exhibitors. (1) Producers include both studio-owning com- panies and companies who produce pictures but do not own studios, merely hiring studio space as and when required. The majority of studio- owning companies make pictures for their own account and also let space (including equipment and technical personnel when required) from time 1o time, but one or two of them rarely make pictures lor their own account, limiting their activities to the letting of stages and equipment, inclusive of technical employees. All leading British Producers numbering 23 in all —are members of (he Film Producers' Group ol the Federation of British [nd istries, which is the official Trade organisation of the British tction Industry. Certain technically British companies, which are in tact controlled mi ' ion of American producing companii and allied with the latter's renting „, -amo- tions in this country, also produce films in Great Britain, but their activities are conn to the making of such films as are needed bj their principals to enable them to comply with. the law relating to British quota. These latter producers are not members of the F.B.I. Film Group, and are ineligible for membership since they are foreign controlled and — except in the strictly legal sense — are foreign companies. The purpose of genuine British Film producers i- bo make pictures which will be distributed as widely as possible both at home and overseas on their merits; they are not primarily concerned in making British films to supply quota to enable foreign pictures to be distributed in Croat Britain, although some of them make British pictures to the order of foreign renters. The genuine British producer employs lab technicians and artistes and expends very im- portant sums of money annually on the making of British films. It is the business ,,, these genuine British producers that the I inemato- graph Films Act was designed more icially to foster and protect, and it is films made by these companies that tend to enhance British presti e and carrj the British point of view to all places, both at home and abroad, where thej are publicly exhibited. The business of renters is to r .,,t to Exhibitors in this country the films -either British or Foreign— which they have acquired. MINUTES OF EVIDENCE 35 12 May, 1936.] Mr. F. W. Baker, Mr. M. N. Kearney, Mr. A. KoitiM, Mr. N. Loudon and Captain the Hon. R. Norton. [( ontinued. Strictly speaking renters have no interest other than that of renting or selling the films they have acquired to exhibitors who show them The majority of renters in Great Britain are, although registered British companies, in fact the controlled distribution organisations of foreign producers and the object of their activities is to distribute foreign films. The genuine British renters (who are a minority of renters) are. with few exceptions, the controlled distribution organisations of British producers and, although they also distribute foreign films, their main business is to distribute British films. The in- terests of renters are confined to the distribu- tion of films in this country. (3) Exhibitors are the individuals or com- panies who own one or more (or a chain) of theatres in Great Britain, and their basic in- terest is to show to as large audiences as they can attract the films (whether British or foreign) which they have acquired from renters. Their interests are confined to the showing of films in Great Britain exclusively. In actual practice, although their functions are separate and distinct, the three main sections of the Film Trade are closely allied. Production com- panies are generally associated with renting com- panies who handle their product, and in certain cases they control important theatre circuits. The two principal theatre circuits in Great Britain are controlled by organisations also controlling British production companies, but there are a number of theatres controlled by the organisations representing foreign producers, and in addition, of course, a large number of independent theatres. In the theatres controlled by genuine British production interests it is not unnatural that the proportion of British pictures shown as compared with foreign exceeds the minimum quota required by the law. In the case of theatres controlled by foreign interests the British quota of films is limited to legal require- ments and in many of them poor quality " quota " films are shown. Many independent theatres show a considerably larger proportion of British films than the minimum laid down by law, and in the aggregate the footage of British films exhibited in Great Britain exceeds the proportion required to be shown by the present Cinematograph Films Act — a fact which can be substantiated by the official figures supplied by the Board of Trade. Although, as stated, the interests of film producers are in many eases closely allied with those of renters and exhibitors, the views expressed and recommendations contained in this Memorandum represent only the opinion of British producers as such. A list is furnished in Annex II giving the names of all production companies who are members of the Film Producers' Group of the F.B.I. General Observations. 1. The primary purpose of the Cinematograph Films Act, 1927, when introduced was to ensure that a reasonable proportion of British films should be seen upon the screens of Great Britain — at that time almost entirely monopolised by foreign films — and to assist in the development of the film produc- tion industry in Great Britain. 2. That the Act has been successful in its main objects is beyond question. An important and rapidly increasing film production industry has been built up. the output of entertainment films in Great Britain is second only in world importance to that of the United States, and in the production of educational, cultural and general instructional films the industry of this country is beginning to take a leading position. While the growing importance of this latter category of films is not to be depreciated, it is manifest that the making of entertainmeni " feature " films is of by far the greater consequence since it (a) involves the invsatment of very large 36452 capital sums for the construction, equipment and maintenance of studios and laboratories and for the production of pictures, (6) provides continuous em- ployment for a large number of wage earners (car- penters, joiners, scene builders, electricians and the like) as well as experts, technicians and clerical workers, in addition to artistes, directors of produc- tion and principal personnel and (c) consumes annually very large quantities of materials produced by British industries. -Some general statistics re- lating to studios are furnished later in this Memo- randum and indicate both the present importance of film production and its growth since 1928. They prove conclusively the development of the industry in this country since the Films Act was made law, and show even more forcibly how great is the in- crease in production taking place at the present time. The vast new studios just completed and others in course of construction, as well as the establishment of numerous production companies with serious financial and administrative support, are an irrefutible indication that the number of worth- while British films available for exhibition in the near future will greatly exceed the present supply of such pictures. It is sufficient here to state that under the protective influence of the Act there has been built up and is being progressively increased an industry of very considerable magnitude, the importance of which cannot be measured by figures alone since it is inalienably associated with National prestige and British moral and cultural influence both at home, in the overseas Empire and in the foreign countries, where the popularity of British films is constantly increasing. Film producers submit that, in any consideration of the working of the present Act or of provisions that may be proposed to maintain or supplement existing legislation in the future, by far the most important section of the whole film industry from a national point of view is that devoted to production, which, among other things, ensures the retention in this country of con- siderable sums of money that would otherwise be expatriated. It is estimated that during the last IS years at least £100,000,000 has been exported from this country as profits on the exhibition of foreign films. 3. Whereas the British film production industry has world-wide interests and British films can carry British scenes, themes, culture and the message of Britain to the furthest parts of the World, the interests of British exhibitors are confined strictly to Great Britain. Their purpose is to secure for showing in their theatres an ample supply of films calculated to attract their patrons, and from this point of view it is of no consequence to them .whether the films they show are British or foreign made provided they draw the public to the Box Office, though it is believed that many of them desire to have a strong British production industry as an alternative source of supply. The purpose of renters is to rent to exhibitors the films they acquire, whether British or foreign, and they secure films either in the open market or from the pro- ducers whose product they habitually handle. The majority of leading firms of renters in Greal Britain are the distribution organisations of and directly controlled by American film production companies. The business of British renters is con- fined in the main to the British Isles and the primary object of foreign controlled renters is to rent foreign films. The position of producers is entirely different for (a) they make British films, and (h) they endeavour to secure the exhibit ion of these not only at homo but overseas also. The difference is one of fundamental and paramount importance, and it is on this account that pro- ducers claim that special attention should be given to t he maintenaco and protection of the produc tion industry. 4. It is an indisputable facl that world attention is now largely directed to the developments taking E 2 36 COMMITTEE ON CINEMATOGRAPH FILMS 12 May, 1: Mr. Mr. F. W. Baker, Mr. M. N. Kjbahnby, [< '•■ < / < led A. Korda, Mr. N. Loudox and Captain the Hon. R. Norton. place in film production in Croat Britain, and pro- is submit that His Majesty's Government have now a unique opportunity of aiding the forward march of this important British industry and assist- ing it to a development which must have far- reaching effects. . 5. The 1927 Act lias been successful in fostering development of British film production, and in this it has been remarkably successful. The require- ment that a minimum proportion of British films must be acquired by renters and shown in cinema theatres was the primary method of attaining: that object. Tt may be contended in certain quarters that a healthy industry should no longer require li ; lative aid for its maintenance, but should be able to support itself without any such assistance. Reference is made later to tbe particular position of the film industry, which renders it especially susceptible to outside competition and particularly dependent on the home market. Since the Cine- matograph Films Act, 1927, was passed the entire policy of His Majesty's Government in affording protection to industry generally has undergone modification. Whereas the Films Act was among the earliest measures of legislative assistance for industry, the principle of protection of industry has, since 1932, been widely applied with success in many other directions and is now a basic part of the country's economic policy. As the British film industry probably enjoys a smaller proportion of the home market than any other important British industry, producers venture to suggest that His Majesty's Government should not contemplate for a moment the withdrawal from the industry of the degree of legislative assistance at present afforded to it, but rather that they should favour- ably consider a reasonably progressive increase of Protection. 6. Producers feel it incumbent upon them to in- dicate .what would he the unquestionable effects of a withdrawal of the existing form of protection were the Quota Act to be allowed to lapse when its main provisions terminate in 1938, and were it not to be re-enacted in some similar form with anv modifications necessitated by changed conditions in the industry and experience gained during the past eight years. In their considered opinion, after very careful examination of the whole question in a series of conferences held by the Group during tbe past six months, producers are unanimously con- vinced that the complete or partial withdrawal of the protection afforded to their industry by the present Act would be disastrous. They are equally convinced that a reasonable and progressive in- crease in the quota will prove beneficial in the future as it has in the past. 7. Tn order to explain these statements it is necessary to go back to the early history of the industry. Before the war the British industry was a pioneer of film production and held an important place in the film industries of the world. During the War British production was closed down owing to tbe inevitable withdrawal of personnel and sup- plies of material. On tbe other hand the cinema theatres were kepi open and supplied with films produced in tbe United States. The American in- dustry was thus enabled to build up a gigantic dis- tribution organisation, based on its largo home market, and to acquire a substantial control of the British market, both in Greal Britain and through- out the Empire. This control was cemented bv the practices of advance booking and block booking of films, i.e.. tbe American companies compelled British exhibitors to book- their films for long periods in advance (up to two years'), thus shutting out British pictures, and to book in blocks, taking both good and bad product together. These practices si ill continue, ami American renters will be able to maintain them unless prevented l'.\ law until such time as the British industry can provide exhibitors with a really equivalent source of supply. America las now about 18,0 !> theatres as against the 4.500 theatres in this country. In Hollywood it has a large city entirely devoted to film production, to which artistes and technicians flock from all parts of the world. American producing companies can spend £200.000 on a picture and recover the cost and a reasonable profit in their own countrv and can then afford to sell the picture in the i ritish market for a sum which would not yield to a British company a profit on a picture costing a quarter of that amount. On the other hand, it lias not yet been possible for British pictures to earn any substantial revenue in America. It is only by the help of the Quota Act that British companies have been able to build up an industry in competition with the dominant American industry. and if this protection were withdrawn, the follow- ing results would inevitably ensue: — (a) The general predominance of foreign films would be restored throughout the entire British market. (b) As the British production industry dwindled, prices for foreign films offered for rental here would tend to rise, and (since films recorded in the English language are the only ones likely ever to find favour with the mass public in the Empire) British exhibitors would be compelled to accept pictures at the prices offered by an organised foreign industry, or close their doors. (r) The results would be: — (i) The imperilling of the large capital sums invested in British studios. (ii) Reduced demand for labour of all kinds in film studios and in the industries supply- ing the trade. (iii) Serious reduction in the values of cinema properties. (iv) Loss of National prestige and the social influence of the British film through- out the Empire, with a corresponding in- crease in the influence of foreign films. (v) The eventual eclipse of all British films, loss of the growing export trade in such films and diversion, mainly to America, of the profits now being made by British producing companies. 8. The above results must be obvious to anyone having the slightest knowledge of the film trade as it exists to-day. It only remains, therefore, to put forward proposals for renewed or amended legisla- tion together with explanations of the several points and the suggestions arising out of them. Explanation! of the working of the prbshnt A< r. S. The existing Act has. generally speaking, worked well. It is familiar to and understood h\ all sections of the trade, ami its main piovisions have been successfully applied without undue hardship in any quarter. In any re-enactment it would not appear neeessaiN to alter the basic form of the (piota pro- visions of the law. although there is certainly need for modification of some of its provisions. 10. Fundamental changes within the industry it- self, which could not have been foreseen when the law was lir.st introduced, have made some of its conditions ineffective in practice. The ingenuity of individuals has succeeded in evolving methods of evading the -pint of the law if not its letter in certain respects. In any new Act it would seem essential to make these evasions no longer possible. 11. The present Act establishes two chief obliga- tions namely (a) upon renters to acquire for the purpose of rental a percentage of British films in proportion to all films acquired, and (b) upon exhibi- tors to show a percentage "( British films in pro- portion to all films shown. In both cases the per- centage (or quota) is based on the total footage oi MINUTES OF EVIDENCE 37 12 May 1936.] Mr. F. W. Baker, Mr. M. N. Kearney, [Continued. Mr. A. Korda, Mr. N. Loudon and Captain the Hon. II. Norton. all registered films handled during a given year. Other provisions require the trade-showing of all registered films before they are offered for rental (this to prevent " blind " booking) and limit the period of advance booking to exhibitors (this with the object of preventing the reservation of play- dates too far in advance by renters having a large and regular supply of foreign product). The law clearly defines what constitutes a British film and ill- dictates the categories of films that may be registered. 12. Beference should be made to the statements of exhibitors that the existing quota is a hardship to many of them, despite the fact that the number of British films has increased and is destined to increase much more in the immediate future and that the quality of genuine British films has vastly im- proved in comparison with the output of some four or five years ago. In the aggregate exhibitors have, as stated in the foreword to this memorandum, shown a considerably larger proportion of British pictures of recent years than the law requires. The cases of genuine hardship are relatively few, and the Act already provides for the exemption of exhibitors who can prove inability to comply with its terms. The very few prosecutions for non-compliance indicate that the vast majority of exhibitors can readily fulfil their obligations. Some exhibitors are understood to incline to the view that an immediate substantial reduction of the exhibitors' quota is the only means of meeting their alleged difficulties ; producers, on the other hand, are confident that the position can be remedied by the- provisions suggested in this memorandum without recourse to so retrograde a step. In the opinion of British producers the main difficulty of such exhibitors as are affected is clue to the fact that, while the Act of 1927 established the percentages of British films that must be acquired for rental and exhibition respectively, it made no stipulation as to the quality or entertainment value of the British films required to be handled. At present any picture made within the British Empire in accordance with the provisions of the Act is eligible for registration as a British picture and to serve for both renters' and exhibitors' quota, whether its quality is good, bad or indifferent. The result of this omission is that whereas to-day an increasingly large number of first-class films is produced in British studios, which compare favourably in technical quality, entertainment value and earning capacity with the best films made in any country, a consider- able number of films is at present produced in Great Britain whose quality is so indifferent as to cast a slur upon the value of all British films. These poor quality films are made almost entirely by or for renters whose main business and sole interest is the distribution of foreign films in this country, and who are not gravely concerned with the quality of the British films they must acquire to meet their legal obligations — indeed the very poorness of quality of the British films they distribute helps by contrast to emphasise the better quality of the foreign films exhibited in company with them. It is common knowledge that many of these films — scathingly re- ferred to in the trade as " quota quickies " owing to the fact that, for purposes of economy, they are hurried through the studio in the shortest possible time — are lamentably poor in entertainment value and do much to detract from public appreciation of British films as a whole, since the general public has no means of knowing the true situation. 13. Both British producers and exhibitors suffer from these poor quality British films made for no other purpose than to enable foreign films to be dis- tributed in this country. Their existence is the principal cause of any difficulties encountered by exhibitors in complying with the law, and is doing considerable harm to the reputation of the British production industry both at home and overseas. It is the purpose of British producers, and they believe it to be the desire of all sections of the British film trade as well as of the public generally, to bring about the elimination of the " quota quickie " and its disappearance from the screens of this and other countries. If that can be done (and British pro- ducers are confident that it can and will be done if the proposals put forward in this memorandum are adopted and enacted by Parliament) the prospects of the British film industry as a whole will be im- measurably improved, the position of exhibitors relieved and the way paved for an important develop- ment of the entire British film industry. 14. A second factor which handicaps British ex- hibitors in obtaining supplies of British pictures is what are termed " barring clauses ". These are clauses in hiring contracts between renters and ex- hibitors restricting the showing of pictures in specified theatres in certain areas or theatres generally (other than indicated theatres in certain districts). Pro- ducers make no specific recommendation with regard to these " barring clauses ", which are the concern of renters and exhibitors. They would point out, however, that neither of these sections of the trade can logically argue a case for a reduction of the quota or against its increase above the present level on the ground that operation of the " barring clauses " makes it difficult for exhibitors to obtain sufficient British pictures for quota purposes. If this is the case they have the remedy in their own hands. 15. Reference has already been made to two very serious abuses that have grown up in recent years, namely, the practices of excessive " advance " book- ing and " block " and " blind " booking. These practices are most injurious to exhibitors and to British producers. An attempt was made in Sec- tion 2 of the Act to limit advance booking, but it is common knowledge in the industry that these re- strictions are to-day generally evaded in practice by means of what are termed " gentleman's agree- ments ". If effective means could be devised of coping with this evil the result would be advantage- ous both to British producers and exhibitors; the more rapid general release of films would be ensured, and the public as well as the British industry would benefit proportionately. Producers strongly recom- mend that His Majesty's Government should consider all possible means of strengthening the present law so as to ensure strict observance of the advance booking regulations. Various means of achieving this have been considered — including the possible introduction of a provision that all renters and ex- hibitors should be required to sign annually a statu- tory declaration that neither they, nor to their know- ledge their representatives, have, during the period covered by the return, entered into any agreement, arrangement or written or verbal or other under- standing for the booking of pictures or reservation of dates beyond the period permitted by law — but it is felt that a solution of the problem can best be left to the Government's legal advisers. Producers regard this question of advance booking as of fundamental importance in the (interests of the British film industry, and consider that a satisfac- tory solution of the matter would be generally bene- ficial to the trade and the public. 16. By " block " booking is meant the common practice among renters of insisting upon exhibitors taking films which they do not require, and would not hire if free to reject them, as a condition for the rental of the better pictures they wish to obtain. Very often exhibitors have to book these films " blind ", i.e. without having seen them. It is mainly by this method that exhibitors are forced to take the British " quickies " offered to them as quota to offset the better quality foreign films they are anxious to secure. Producers do not feel that it is within their province to make general recommendations to the Committee regarding this practice of block booking, but they suggest that the Committee might examine into it and that in any event effective steps should be taken to pre- vent the block booking of " quota quickies " coming within the category hereinafter referred to. 38 COMMITTEE ON CINEMATOGRAPH FILMS 12 May, 1936.] Mr. F. W. Baker, Mr. M. N. Kearney, [Continued. Mr. A. Korda, Mr. N. Loudon and Captain the Hon. R. Norton. 17. The following paragraphs set out in detail the proposals which British producers wish to make lor amendment of the Act : Where necessary the reasons for and purport and scope of the several proposals are indicated. Proposals of British Producers for Revision or Re-enactment of the Cinematograph Films Act. 18. The purpose of these proposals is to provide for a continuation of the quota system for the pro- tection of the British Industry, to secure the pro- duction of more and better British films, to elimi- nate the poor quality " quota picture," to facilitate the task of exhibitors in securing a sufficient quan- tity of suitable British films of quality to meet their requirements and to rectify various provi- sions of the existing Act so as to meet present clay conditions in the film industry and ensure further attainment of the main objects at which the Act aims. Reference has already been made to the number of British films of poor quality now made for the sole purpose of fulfilling the quota obliga- tions of renters of foreign films. This class of film must be done away with. The present tendency of production in Great Britain is to make many more films of quality for universal distribution — films which must depend upon quality alone in order to achieve financial success and which, although they may serve for quota, are not produced chiefly for that purpose. Vast new studios have, as pre- viously stated, been constructed or are in course of erection, and their output cannot fail substan- tially to increase the number of high class British films that will be available for rental within the next few months and subsequently. The statistics furnished in Annexe III to this Memorandum indi- cate the great increase in studio capacity: they also show the increase in the number of feature films produced in 1935-6 as compared with the first year of the Film Act's operation, but they are particularly valuable in indicating the huge increase in production cost of the genuine British pictures now produced and to be produced, and the large sums of money paid out annually in the form of salaries and wages in this country. The following are the recommendations of British Film Producers : — Proposal 1. — That the principal substance of the existing Act be maintained, and re-enacted to cover a further period of at least ten years from the date of coining into force, the unexpired period of the 1927 Act being repealed from such date. Proposal 2.— That the principle of the present quota system be maintained, but applied in a some- what different manner. Quota to be a percentage of foreign films acquired by renters and shown by exhibitors 'instead tof a percentage of all films handled as at present. All films to be registered as at present in order to be eligible to serve as renters' or exhibitors' quota, and the Board of Trade registration certificate to state clearly whether a film so registered is available for routers' and exhibitors' quota or for exhibitors' quota only, ns the case may be. Renters' qi'ota.— Long films (i.e. over 3,000 feet in length). (a) All long British films as defined in the present Act (subject to suitable modification as regards films made in overseas Empire coun- tries and in other minor respects as herein proposed) to be eligible for registration as renters' quota. (b) Long films registered for renters' quota costing less to produce than a total of £2,500 per reel of 1 ,000 feet, or £1,250 per reel in respect of the items required to be returned on Board of Trade Form " C," subject to f) maximum total requirement of £15,000, or £7,500 on Form " C." in respect of any one- film , to be described on the Registration Certi- ficate, on all copies issued, on all invoices, in all publicitj material and on a special title certificate to be displayed legibh on the screen after the main title and again at the end of the picture at every performance for a mini- mum period of 30 to 40 seconds, on each occa- sion, in the following or similar suitable manner : — " This picture is a Benters' Quota Film acquired by Messrs. to enable them to distribute foreign films.'' Long films registered for renters' quota cost- ing more than the amounts indicated in the immediately preceding paragraph not to be re- quired to carry such certificate or display it on the screen. No long film costing, on form " C " basis, less to produce than 15s. per foot, with a maxi- mum requirement of £4,500 in respect of any one film, to be eligible for registration as renters' quota. (c) Long British films not registered for renters' quota not to be required to carry any special description. (Note 1. — Experience has proved that there is a direct relationship between the total production cost of feature films and the expenditure for salaries and wages (75 per cent, of which must be paid to British subjects) as returned on form " C." The form " C " figures' vary between 45 per cent, and 55 per cent, of total cost, with an approximate average of 50 per cent.). (Note 2. — Producers are convinced that the stigma attaching to the showing of poor quality " quota pictures " would quickly cause the public to refuse to patronise such films and that exhibitors would refuse to rent them. The pillorying of the cheap quota film would rapidly lead to its own extinction once the public became aware of the purpose for which it was produced. Only renters mainly engaged in the renting of foreign films (who are the chief offenders in the distribution of poor quality " quota quickies ") .would be affected by the pro- posed new provisions. Renters whose main business is the renting of British films on their merits would not be affected. Pro- ducers have given most careful study to the problem of the Quota Act and have in- vestigated many plans for elimination of the poor quality " quota picture." They do not suggest that high cost of production neces- sarily means good pictures or that a cheap picture cannot sometimes be a good one, but experience shows that films registered for renters' quota and costing less than the figure indicated are generally bad. If a good British picture were produced cheaply it should not suffer from tin' " label." On the other hand, if made by a genuine British producer for purposes other than that of merely supplying foreign renters' quota, the less expensive British picture could be registered for exhibitors' quota only, reined on its merits and would not. therefore, be compelled to carry any " label.") («/) Suitable modification of the Act to ensure that poor quality British pictures routed by exhibitors shall not lie shown in theatre- during what are known as " dead " hours. The law should ensure that British films shal] be shown regularly in the regular programme. (.V../, 3. Section 10 of the Act lays down the manner in which the proportion of British registered films shall W exhibited m all theatres, it has become a practice in many theatres to exhibit the poor quality MINUTES OF EVIDENCE 39 12 May, 1936.] Mr. F. W. Baker, Mr. M. N. Kearney, [Continued. Mr. A. Korda, Mr. N. Loudon and Captain the Hon. R. Norton. British films they have hired during the " dead " hours of daily sessions, when hut few patrons are present. If the proposals contained herein for elimination of the " quota quickie " are to be successful it is essential that steps be taken to make the special showing of British films during the " dead " hours impossible.) Short films (i.e. less than 3.000 feet in length). (e) Extension of the appropriate clause in the existing Act so as to permit of registration of certain classes of short films, as detailed below, to serve as renters' and exhibitors' short quota. The classification to include short films depicting : — (i) Scientific subjects, including natural history (but not strictly " school room " educational films). (ii) Documentary films generally. (Note 4. — There has always been an annual deficit of short British films available to meet short quota require- ments. The production of short British films, other than purely entertainment films, but containing an important en- tertainment element, is being widely developed in this country, and it is thought desirable from many points of view that the production of gooTl pic- tures of this type should be encouraged. If such films were permitted in future to be registered and to serve as renters' short quota, it should be helpful both to their producers and to exhibitors.) (/) Short films registered for renters' quota costing less than £500 per reel to produce (or £2-50 in respect of the items returnable on form " C ") to be described in the manner above indicated in respect of long films. Proposal 3: Exhibitors' quota. — All British films as defined by the Act (subject to modification as already indicated) and registered as such to be eligible irrespective of cost to service for exhibitors' quota, whether or not they are also registered for renters' quota. 1'roposal 4. — Renters' and exhibitors' quota to be fixed at the precentage rates shown in Annex 1 to this Memorandum. Renters' quota to rise from 29 per cent, of foreign films acquired in the first year to 54 per cent, of foreign films acquired in the sixth and subsequent years. Exhibitors' quota to rise from 25 per cent, of foreign films shown in the first year to 50 per cent. of foreign films shown in the sixth and subsequent years. (Note 5. — The third column in Annex I indicates the equivalent percentages calculated by the present method as compared with the suggested percentages calculated by the new method. The proposed percentages provide for the maintenance of a reasonable margin between renters' and exhibitors' quota. It will be noted that the maximum quota for exhibitor-, to be attained in the sixth year of the proposed new Act. provides for the showing of one British film out of every three films exhibited. This proportion cannot be considered excessive.) Proposal 5. — All films screened to bear a legible title showing whether they were made (r;) in the United Kingdom, (b) in the British Empire Over- seas, or (r) in a foreign country. Proposal 6. — Provision to be inserted in the Act effectively to prevent renters from requiring ex- hibitors to hire a British quota picture of the type referred to in Proposal 2 (b) and (/) as a condition for the hiring of a foreign film. Propositi 7. — New provisions in the Act to deal effectively with the present practice of evading the terms of the law as to advance booking Proposal 8. — A new clause in the Act to permit of foreign negative being used in the making of a British film up to a maximum of 10 per cent, of the total registered length but not more than 20 per cent, of the studio scenes depicted in it (whichever is the less), without disqualifying such film from registration as a British film for all quota purposes. The cost of such foreign negative not to be included in calculating the cost of the whole film for the pur- poses of renters' quota as indicated in Proposal 2 above; the cost being calculated only on the balance of the footage of the film exclusive of the foreign negative. (Note 6. — It has been found from experience that it is frequently convenient for British pro- ducers, for local background or other purposes, to utilise scenes or short sequences already made by foreign companies. There should be no reasonable objection to the inclusion, if desired, of a limited length of foreign negative in a British film provided that the film as a whole otherwise satisfied all requirements of the law as to what constitutes a British film.) Proposal 9. — The inclusion in the Act of clauses permitting the employment of juveniles in studios for the purpose of portrayal in films. (Note 7. — Detailed proposals in this con- nection have already been submitted to the Home Office. The Committee of Inquiry is doubtless aware that the employment of children under the age of 14 years for portrayal in films made by British producers is illegal by the terms of the Children and Young Persons Act. 1933. and the regulations of Local Authorities made under it. This restriction has proved very disadvantageous to British producers, and has resulted in their being unable to make many pictures of a very popular type which can be readily made abroad and shown without hindrance in this country, and in child actors of talent being taken abroad for employment. The whole question has been most carefully studied by British producers in conjunction with labour and educational interests, and detailed repre- sentations have been made to His Majesty- Government. In these proposals the fullest pro- vision has been made for safeguarding the wel- fare of the children. Producers suggest that any re-enactment of the Films Act would pro- vide a suitable opportunity for dealing with this matter.) Proposal 10. — Abolition of the clause in the exist- ing Act granting to films made in any parts of His Majesty's Dominions the same facilities as are accorded to United Kingdom films to serve for renters' and exhibitors' quota purposes in Greal Britain, and the introduction of provisions for reciprocal treatment of films made in Empire countries according as their domestic laws favour or penalise United Kingdom films. (Note 8. — The present Act gave to producers in all parts of the British Empire the same ad- vantages as were accorded to United Kingdom producers, and it was confidently anticipated that as time went on an Imperial quota Hot British films would be established in all the principal Dominions and Colonies. As events have proved, however, in the course of the lasl eight years, no British territories, with the ex- ception ol certain of the smaller Colonies, have introduced ami applied quota legislation in favour of British films. On the contrary certain stales of the Australian Commonwealth have introduced local quota regulations requiring 40 COMMITTEE ON CINEMATOGRAPH FILMS 12 May, 1936. ] Mr. F. W. Baker. Mr. M. N. Kearney. Mr. A. Kokda. .Mr. N. Loudon and Captain the Hon. R. Norton. nued. that a proportion of home-produced films shall be exhibited, without extending the advantage of such quota legislation to films produced in the United Kingdom. This state of things is dangerous to United Kingdom films as they will be eligible for quota in Great Britain only, whereas, unless the terms of the present Act are modified, Australian films will be eligible for both Australian and British quota, which will make them more attractive to the foreign renters who supply both markets. Furthermore, there have been instances of films made in the Empire for purely local purposes being acquired by foreign renters here at negligible cost for the sole purpose of serving as quota to match foreign films. It is felt that in equity the pro- visions of the present Act should be amended so as to exclude from its benefits films produced in other parts of the Empire except to the extent to which the laws of such countries accord commensurate advantages to United Kingdom films. The modification of the Act in this respect in the manner indicated would not debar the adoption of an Imperial quota scheme, should such a scheme be agreeable to various of the Dominions at a future date.) Proposal 11. — Abolition of the clause in the present Act requiring that the author of the scenario of a British film shall be a British subject. (Note 9. — This clause has always been a hindrance to British producers and, while all of them are anxious to use the services of British scenario writers, it is strongly felt that this work should not be limited by law to British subjects). Proposal 12. — Section 1 (2) — in conjunction with Section 5 (4) — of the present Act makes it illegal to show to the public a film for which application for registration has not been made, except in one theatre only for a number of consecutive days. This restriction has been found in practice to operate to the disadvantage of British producers as compared with their competitors abroad. While the purpose of the sections quoted is obvious and their desir- ability recognised, it would be to the advantage of British producers if a modification could be intro- duced in the law to permit of their " trying out " a film at consecutive performances in a reasonable number of centres before application for registration. Public reaction to a picture in various parts of the country is a most useful guide to producers in finally deciding upon the completed version of a picture for general exhibition, and a modification of the law to permit of this would be of considerable help to producers without reducing the value of the general requirement that all pictures shall be trade-shown before application for registration. Proposal 13. — That the existing penalties for failure to comply with various provisions of the law should be amended in a new Act as follows: — Part 1, Section 3. — Increase to £250. Licence liable to cancellation after third offence. Part 4, Section 28. — Increase penalty to £100. Proposal II. — That steps be taken to provide for the supplying to the Government particulars of films made for public entertainment other than those re- quired to be registered by the Act. (Note 10. — This is merely a recommendation. It would be extremely useful if more statistics of the ill iii industry were available, and at present there is no record of films other than those required to be registered). IKS. (Chairman) : I understand that Mr. Baker will in must cases answer. If there is any matter on which some other witness has anything to say. of course, we shall be glad to hear you; buf in the ordinary way we do not expect five answers to each question, and it may be that in some case Mr. Baker may wish some other witness who is specially in- terested in a particular point to answer for the whole side. Since we have had your memorandum of evidence we have also had a very interesting table put in, I think only this morning, showing the remarkable development in the industry, i Annex III.) I am not proposing to take you right through the evidence, we have all read it very carefully, but I would like to ask a few questions which seem to arise out of it. Before we begin on the detail could you tell us on what conditions producers are eligible to your group. You mention that companies technic- ally British but controlled by foreign interests are not admitted. I wonder how you measure the control by foreign interest? — (Mr. Baker): My Lord, all British producing companies are eligible for mem- bership to the Federation of British Industries, pre- suming that they have at least made one British picture. That is to say, there must be evidence that they have made a British production and being a British company they are eligible for the Federation of British Industries. That includes all the British producing companies in England. 117. Do you not here say that: — " These latter producers " — that is those who make films in this country but whose activities are confined to the making of such films as are needed by their principals to enable them to comply with the law relating to British quota — " are not members of the Federation of British Industries Film Group and are ineligible for membership since they are foreign-controlled and — except in the strictly legal senses — are foreign companies." ? So that it would appear you ride out people who do produce films in England. How do you measure the foreign control? — The question of capital and the regulations applied to membership of the Federation of British Industries generally. The companies or firms must be mainly financially con- trolled in this country. 118. You get a list of shareholders? — Yes. 119. And you see the majority? — Yes, that, of course, is decided by the Federation of British Industries, of which no doubt you know. 120. It is not you who exclude? — No. it is the Federation of British Industries who elect. 121. It is a committee of the Federation of British Industries? — And similar rules apply to all manufacturers in this country. 122. Are there any' important producers outside the Group with studios? — No. my Lord, there are no important producers outside the Group. One may assume that the Group represents British pro- duction. 123. There are many films produced by companies backed by foreign capital? — Yes, but those in- dividual units in the main are members of the Group, my Lord. 124. Really this provision about foreign control does not apply? — I think it can be dismissed, yes. 125. These foreigners who produce films in Great Britain, but who only produce fur these foreign principals, are excluded. You have just told us there is no important producer in this country who is not a member of your Group? — That is so. 126. I am a little puzzled as to what that means - —I will explain it at length, my Lord, if you .:■ sire. L27. It us clear this up. You sa\ the people ,\ 1 1 h Foreign control are not members, and yei you tell us that all the .substantial producers are members. Is there not a considerable number ot substantia] producers in this countrj who are under foreign control': No, they an' not producers in the strict sense of the word. American companies engaged in business in this country are not able themselves to produce films because they would not be termed British films if they made them and MINUTES OF EVIDENCE 41 12 May, 1936.] Mr. F. W. Baker, Mr. M. N. Kearney, [Continued. Mr. A. Korda, Mr. N. Loudon and Captain the Hon. It. Norton. therefore they contract out and engage small com- panies or persons some of whom are members of the Film Group of the Federation of British Indus- tries to make films for them, and in that way some " quickies," or the cheap films referred to in the memorandum, have been made by members of the Federation of British Industries. 128. So the controlled organisations over here are not members? — That is correct. 129. I see. You speak of the importance of the industry. Have you any figures as to the amount of labour employed on production? — Well, my Lord, the film producing is mainly in the studio. Pro- ducers are large purchasers of manufactured material. We have evidence, if it is desired we submit it, that about 5.000 persons are directly and permanently engaged in the studios in this country at the present moment, but that does not by any means represent the amount of labour en- gaged in British film production generally. 130. In regular employment? — That is regular. That takes no account, my Lord, of artists. You will appreciate that artists have varying salaries and therefore we take no account whatever of artists of any description or casual labour in men- tioning that number. 131. What sort of number of artists is there? — That is very difficult to say, and I could not really furnish the number of artists who are regularly or irregularly employed. Of course there is a con- siderable number. 132. Have you any figure as to the annual cost of production? — We have that on the statement handed in. 133. £5 million? — The fourth column gives the cost of productions during the last year as approxi- mately £5 million and a third. 134. That covers everything? That is gross? — That covers the whole of the films therein referred to. 135. This is " Form C " expenditure? — No, it is not " Form C." It is the cost of production. 136. And, of course, this is only feature films. I probably ought to know. Do your companies pro- duce many non-feature films? — In this country there are not a very large number of short films made for reasons that are known to some members of your Committee, but one is pleased to say that the number of such films is increasing. 137. But your Group is concerned with whatever is produced in way of short films? — We only mention the features here for the purpose of clarity. In addition to those features there are a considerable number of short films made, not so many as one would hope, but we believe our proposals would stimulate further the making of short pictures. 138. The cost of those films is outside this £5 million? — Oh, yes, that is entirely apart, as also is the cost of news reels, etc. 139. The majority of more important renters in Great Britain, you say in your foreword, para- graph (2), are, although registered British com- panies, in fact the controlled distribution organisa- tions of foreign producers and the object of their activities is to distribute foreign films. I am rather puzzled .about that, because I think I have seen there are nine foreign-controlled renters and alto- gether 65 renters licensed? — The majority of princi- pal renters in Great Britain are, although regis- tered British companies in fact, the controlled dis- tribution organisations of foreign producers and the object of their activities is to distribute foreign films. That is a statement of fact, my Lord, and if you refer to the number of renters that are licensed by the Board of Trade that might be very deceiving because there is a large number of comparatively small renters. We are dealing here and looking at it from the point of view of the number of films that are produced and distributed. 140. Taking the actual output of films? — Yes. 141. The majority of films rented are controlled by people under foreign influence? — Yes, and when the Act came into force it was generally recognised the amount of film so controlled varied from 91 to 95 per cent. The Act has met that position to a con- siderable extent. 142. In the same way you say there are a number of theatres controlled by organisations representing foreign producers, and I have not appreciated that foreign producers had a very large interest. We have heard there are 12 Paramount theatres, and a lew in the West End of London. Are there any other considerable groups under foreign control? — We say in the case of theatres controlled by foreign interests the British quota of films is limited to legal requirements and in many of them poor quality " quota " films are shown. We do not say the number of theatres, my Lord. 143. But 1 rather infer it is a considerable number. It is not really very large? — We do not say it is a large number. 144. In fact are there any other groups larger than the 12 Paramount? — No. Unless one takes into account the American capital in the Gaumont-British organisation. 145. In paragraph 2 of your " General observa- tions," you say the Act has been successful in its main object. Would you say it is the Act, or the invention of the sound film which is primarily or mainly responsible for the increase of British films? I would like your opinion as to the relative import- ance to be attached to the Act, or the comparative importance to be attached to the Act and the in- vention of sound films? — Oh, well, my Lord, there is no doubt in our minds that the Act has been mainly resrjonsible for the increased production of British films. My mind goes back to the year following the War, when the screens of this country were almost exclusively occupied by American films. In 1920 and 1921 British producers were very much concerned because of their difficulties in getting British films on the screen, and Lord Beaverbrook, who then had considerable interest in the film busi- ness, called the whole trade together to see what could be done to correct this very important matter and also to permit the public to see newer films because at that date the exhibitors, the theatres, were booked up for a period of not less than 18 months ahead with the result that the films, foreign and British, on the screen were very old. A con- siderable amount of money was spent by British pro- ducers in those days in an endeavour to find a solu- tion, and arising out of that, His Majesty the King (then, of course, Prince of Wales), interested him- self by attending a luncheon and the British National Film League was formed. The main ideas of Lord Beaverbrook were not successful because we could not get the foreign renters or distributors to agree with the British distributors of those days to limit the number of pictures. There was an endeavour to control releases and so on, and in 1921 I associated with Colonel Bromhead, and I wrote to Colonel Bromhead in November, 1921, and said, " As a trade we cannot correct this evil of blind and block booking but let us British pro- ducers endeavour to do so," and arising out of that the British National Film League was formed, and in 1921 one of the conditions was that films should not be booked until after the trade show and that no booking should be arranged more than six months ahead. So you see we were anticipating many years before the Act came into force some such regulation as did eventually come into force. 146. Tn fact that voluntary arrangement >vas not altogether successful? — That voluntary arrangemein was a complete failure. 147. Block booking became an even greater problem among British producers than American? — Colonel Bromhead on behalf of Qaumoni Company and other producers at the time and mvself wore verv interest d and probably put our businesses in jeopardy in the endeavour to break down the strangle-hold the American companies had in those days on the screen. 36452 42 COMMITTEE ON CINEMATOGRAPH FILMS 12 May, 1936.] Mr. F. W. Baker, Mr. M. X. Keaknky. [Continued. Mr. A. Korda, Mr. N. Loudon and Captain the Hon. R. Norton. As I say we were not successful and one after another the producing companies either failed or turned out very very few films, and that led up, of course, to the consideration of the Government and to the 1927 Act, and that was, of course, a necessity in those days, and in my view, and I am sure in the view of my confreres, it is no less necessary to-day. 148. Yes, but you are talking of the time before sound films, and is it not the case there is such a prejudice on the part of the public against the American accent and in favour of the King's English that quite apart from the Act you have had a great assistance to British production ? — I would agree generally, but I think there is a tendency grossly to exaggerate that advantage, because we know very well that the Americans quickly corrected their films in the matter of speech. I have no doubt that we have all noticed the improvement, or the alteration in the speech of American artistes, and so on, and I think that ought not to be exaggerated — the advantage that the British industry had in relation to sound. I would be willing to admit a slight temporary advantage in the matter of sound, but I would not agree that it was a permanent advantage. 149. In your " General Observations," at the end of paragraph 2, you put the estimated export of payment from this country for foreign films at £100 millions during the last 15 years. Is there any published basis for those figures? — Well, my Lord, there are ways and means of estimating the amount because we do know the gross values. Shall I say, we do know the gross hooking value, or the box office value, of theatres in this country, and the percentage of American films that are screened in those theatres, and we can by that and other methods arrive at a fairly accurate, but of course estimated, amount of money earned by American films, all of which is sent out of this country except the necessary percentage for the distribution and costs that occur here. 150. You say in the next paragraph that the position of British producers is very different, they make British films, and they try to secure the exhibition of these not only at home but overseas as well. Either now or in a separate memorandum I wonder could you give us details as to the export of our films? We have seen figures about the British Empire, but it would be interesting to see what the foreign market is. There the sound film is tell- ing against us just as much as it is telling in our favour in this country? — You mean excluding the Colonies and our own possessions? 151. Yes. It would be interesting to have details also for the Dominions because .we have only got the footage and not the distinction between positives and negatives? — I have no doubt we could prepare a memorandum giving those figures, (Mr. Kearney) : It would be «[iiite impossible to prepare a memoran- dum showing the returns of revenue earned by British companies with their films overseas unless the overseas sections of the various companies will give us particulars of what they earn. 152. Can you not tell the amount of film yon export? — You can tell the amount of footage of negative and positive film exported, but that has no relation to the value of those films from the rental point, of view. A thousand feet of film with a subject of no value upon it counts the same as a film of extreme value in statistical returns. Tt is what films earn that matters, and not the footage, that is why the Board of Trade and Customs return of footage has no relation to values at all. 153. In the absence of statistics can you give us your impressions as to whether it is easier now to find a market for British films in foreign countries? — It certainly is not easier to find markets to-day that before, because every foreign country is impos- ing restrictions of one kind or another; but to-day there are far more British films shown overseas than four years ago, at least they earn more in some cases in very much better conditions. They are gradually becoming more successful. 154. In the United .States of America too? — Yes, in the United States of America too; as worth-while pictures go out so they are beginning to earn more. (Capt. the Hon. B. Norton): I think it would be quite possible to ask these companies if they would give us the figures of rental. (Mr. Baker) : I think, my Lord, if that information would be of use to the Committee we could get the companies volun- tarily to give us that information or some figures that would give you the information you require. 155. I think it would be of value to us, we should like to see how far the existing system has been affected and how far foreign systems have put countervailing difficulties in your way? — You remem- ber nearly all countries have been following the lead this country took in the matter of quota and the difficulties in that direction do not decrease because they all aspire to show their own national films. 156. That gets me to the point which you make in paragraph 6. You anticipate serious setback unless the Act is re-enacted in some similar form with modifications. Of course, it is an unusual form of protection. You quote the protection which other industries enjoy, and I should be glad to know whether you have considered alternatives and whether you think protection by tariff would be ineffective in the case of films, and whether you have examined the methods adopted by foreign countries and find they are less effective than the rather complicated ma- chinery which we have here? — We have from time to time given consideration to other forms of protection, but the trade generally is very firmly of the opinion that only by the compulsory screening of a given quota of British films can the British industry be maintained and increased. Apart altogether from other objections there would be a very serious diffi- culty in endeavouring to tax films coming into this country because their value is unknown for one thing until they have done their work. 157. But is there an advantage in the quota as compared with the system which they have in Ger- many?— Yes. 158. So many films are allowed every year — I do not know whether they are divided among countries, but there is a maximum? — Yes. I think it is only the inverse way of the quota. They allow so many films to come in and we, on the other hand, say. " For all the films that come in you must have a certain quota of British pictures ". (Mr. Korda) : That position is entirely different. We have com- petition with the same language. In Germany Eng- lish counts for very little, and in France an English or American film counts for very little. Here, on the other hand the Americans can import 200, 300. 400 or 500 pictures, all in English, while the German or French producer has no real competition at all. {Mr. Baker): You appreciate the point, my Lord, that in this country the American language is sup- posed to be identical with the language that we know here, and therefore all those films are welcomed here, or get shown here in contradistinction to the Continent where American or English is a disadvant- age to those films. 159. I gathered from Mr. Korda's remarks that French and German films are more welcome here than British films in France and Germany:- — (Mr. Korda) : No, French and German films here are absolutely negligible. They are played in two or three theatres in the West End only and in a few others in the larger cities. 160. Successes have been in London?— I do not think they are 1 per cent. (Mr. Baku): They cannot be calculated. 161. The real problem is the American film. Then, in paragraph 7 you sa\ it has not been possible for British films to earn any substantial revenue in America. Do you see any prospect of effective entry into the American market? — Well, that is a very difficult question. 1 was going to say we have been MINUTES OF EVIDENCE 43 12 May, 1936.] Mr. F. W. Baker, Mr. M. N. Kearney, Mr. A. Korda, Mr. N. Loudon and Captain the Hon. R. Norton. [ ( 'mil i II in / trying to get a foothold in the American market as long as I can remember, but there have undoubtedly been many serious efforts over the last 10 or more years, and to-day, as you know doubtless, there is a revival of the endeavour to get British pictures on to the screens in America, and it is encouraging — I do not think one could say very much more than that. We do know of British films that have had remark- able screening time in America. 162. (Sir Arnold Wilson) : Were they the best films or the worst? — They were the best British films. 163. (Chairman): Then, in paragraph 7 (b), you point out the danger of decreasing the British in- dustry and the likelihood of American interests taking advantage of it to hold the exhibitor to ransom. I suppose the contrary tendency would have a contrary effect? If too strong protection is given to British producing industry, there is a danger that they may in their turn impose ? — I do not think so, my Lord, because we have not seen that in other industries. One remembers the time when most of our roads were covered with American cars ; but to-day anyone of us can buy a motor car to suit his particular purse in this country. Pro- tection has made that industry and increased pro- duction— and has increased production at the right prices. 164. It is so tremendously costly to produce films that it must remain in the hands of comparatively a small number of groups, and is there going to be sufficient competition between those groups? — My view is that some of the recommendations of our proposals encourage the production of films by additional units or companies, probably many of them small, and I and my confreres 'believe if we have this quota, if this continues and increases it will encourage other producers to commence busi- ness, because they will have the security of being able to sell their production at home, and I think competition will seriously increase in the produc- tion field and that there is no chance whatever of the British producing interest having the strangle-hold on the screen. 165. I would like to come to paragraph 13. You say exhibitors suffer from the poor quality British films. How is it the exhibitor is forced to show these films? Is it the effect of the continuance of block booking? — Yes, to a large degree, my Lord, many of the American companies, or the American business generally, are in such a position that they are able to force the exhibitor — and always have been with the reservation that the Act restricts them somewhat — but they have always been able to force the exhibitor to take not only poor American films, but the cheaper British films that they have had to acquire for quota. 166. It was anticipated measures against blind booking would check block booking, but in fact that object has not been achieved? — In so far as that is concerned the Act has not been entirely success- ful, because there did spring up in the trade a form of — shall we call it — the " gentleman's agree- ment " — we coined the word. There were under- standings between exhibitors and the American com- panies that they would reserve dates for the American product. The British companies at that time were very much concerned, and it would be assumed they did not do that and held back for a considerable period of time. Perhaps we are taught to observe an Act of Parliament in spirit As well as in word, but eventually I must confess the British renters had to follow suit because the showing dates were passing to the American dis- tributors. 167. If you stopped blind booking by methods which you are coming to, you still will not neces- sarily be able to stop block booking which apparently compels the exhibitor to take bad films. Do you see any remedy for that? — No, I do not see any absolute remedy. 36542 168. You could shorten the range by stopping blind booking, but you will not really affect the system? — Except this, my Lord, 1 believe the num- ber of British films on our screens will always be regulated approximately by the quota, that is to say, if the quota was 5 per cent, the strength of the foreign competition is such that approximately there would be 5 per cent, screened, and if the quota were 50 per cent, there would be 50 per cent. British films on the screen, because exhibitors would be forced to reserve dates in order to play British films. That is the corrective of block book- ing, the quota, because the exhibitor will not block book if he knows he has to comply with an Act of Parliament and show 20, 30 or 40 per cent. of British pictures. He has to reserve dates for those films, and he does so. 169. The remedy is to ensure there is an adequate supply of good British films, if you can get that? — Well, I think the proposals we make for the quota on distributors together with the increased production provided for will look after that. 170. You do not see any prospect of doing without the quota on renters also? You would not leave it at a quota on the exhibitors? Is there not sufficient production to let the exhibitor look after the whole issue? — Do you mean to relieve the renter of the quota ? No. 171. You do not think you could do without the renters' quota? — Oh, no. The renters' quota surely is necessary in order to provide films, to fill the ex- hibitors' quota. 172. I do not think necessarily. There might be such a volume of production in this country that the exhibitor could find all the British films he wanted without the obligation on the renter to supply films beyond those that he wanted to supply? — My view, my Lord, would be that abandonment of the quota on the renter would immediately tend to stop, and very quickly stop, the production of many British films. 173. At present you certainly could not do without it by the figures, but if British production was ex- panding and there was an ample supply of really good films, and the exhibitor would be free, therefore, from the effect of block booking, presumably in his own interest he would leave out badly produced British films? — I am afraid I cannot see the day when we should be able to leave out the quota on the renter. (Mr. Korda) : Surely the quota would not be necessary if there were enough good British pictures made by two, three, four or five different firms? It is not necessary that every single renter should distribute a certain quota of British pictures, so it is possible to think of a day when only good British pictures are produced and an exhibitor can find all his quota from British renters ; but for the moment I do not think that could work yet. (Mr. Kearney) : It is also the method by which the trade is carried on. The exhibitor inevitably must get his pictures from a distributor. There are classifi- cations of distributor as mentioned earlier. We were speaking of the foreign distributor (although he may be technically British, and is a registered British company), but as a foreign distributor, his main purpose is to rent his foreign films and he would rent no English films at all unless he were obliged to do so for quota purposes. It is only because there is ;i renters' quota that the foreign renter— I use the word in its generic sense — distributes any British films at all. To-day he has to distribute 20 per cent. of British out of 100 per cent, of his total distribu- tion, but he would not distribute any British at all unless he had to do so by law. 174. (Dr. Mallon): Would it matter very much if there were English distributors who specialised in the distribution of British films?— Possibly not. only that he would book most of the dates for Ids foreign films and leave few dates for British pictures to bo shown. (Mr. Baker): One must keep in mind, the F 2 44 COMMITTEE ON CINEMATOGRAPH FILMS 12 May, 1936.] Mr. F. W. Baker, Mr. M. X. Keabnby, Mr. A. Korda, Mr. N. Loudon and Captain the Hon.' R. Norton. | ( <>n firmed. undoubted superiority or strength of the foreign com- panies. You see their strength is such to-day that the British film industry could not live unless quota and other regulations were framed to force renters to acquire, and compel exhibitors to show, British films. 175. (Mr. Holmes) : Shall we pursue this par- ticular point? The point 1 want to put is this: supposing Parliament decided that in future every exhibitor in this country should have 50 per cent. British films for 10 years? That woidd encourage production of British films. I cannot see that it is necessary for the renter to be compelled to take any quota of British films, because the effect, il Parliament had laid down that 50 per cent, of the cinema theatres in this country should exhibit British films, would be that they would be made — that would encourage the film makers to make British films. There would then arise, surely, in London, a number of renters who would concentrate on British films and the cinema people, exhibitors, would know that they could go to these renters to get their British films. They could not fill up with foreign films, they could only half fill the theatres with foreign films? — Well, I do not suppose the producers would have any great objection to that, but I think our friends, the exhibitors, would say it would be very unfair to compel them to show 50 per cent, of British pictures without the similar compulsion on someone or other to make those pictures. That is the answer to that question. 176. I am talking about the renters, and they are not going to make the pictures? — They have to acquire them, and that is the same thing. The renters have to acquire the pictures, and in order to acquire British films they have to be made in this country. 177. What you are trying to get at for the moment is the making of more British pictures and the em- ployment of more people than the ."3,000 regular employees you have got. The quota, as far as the exhibitors are concerned, will encourage the making of these British pictures?— Yes, that is agreed, and I do not suppose we, as producers, would have any grave objection. 178. I cannot see how the renters would come in either to encourage British producers to produce films? — (Mr. Korda): Foreign renters simply acquire or have made what they are compelled to. and do so as cheaply as they can. They acquire British pictures for £2,000, £3,000 or £4,000, and every Saturday and Sunday night one can go into some of the biggest cinemas in the West End, and the people go to jeer at the British picture and to make fun of it. 179. I thought you said the renters? — Yes, the renter is compelled so far to rent — to acquire — to put on his renting list — a certain number of British pictures. It is the renter who promotes the making of quota pictures of the type we are discussing. ISO. Yes? — And they have to go to someone to make them. 181. Yes? — And they go to some firm and say, " We need 10 pictures. For how little can you make them? " and they try to make them for £40,000 or £30,000. To-day renters can buy their pictures for £2,000 or £3,000 each. 182. I still cannot see why putting the quota on the renter will make any difference? — I fully agree with your point. The foreign renter so far did nothing to help the British film industry, and if he could be cut out we would be dealing with one opposition less and haw o\er 100 less had pictures. In my opinion the method you suggest of saying to the exhibitor, "You have to devote half of your screen time to British pictures," would inevitably lead to the growth of the British film industry. (.1//-. Baker): 1 do not think that. (Capt. the Jinn. I'. Norton): I think there is grave danger in this because it would automatically encourage a lot of cheap production taking up screening time, and the bulk of the revenues for screening would .still go to the important American pictures. 183. (Chairman): I think we shall have to pur- sue this separately afterwards. When 1 asked the question I did not at all wish to suggest that it could be done at the present moment, because I quite appreciate that there would be a disastrous amount of dislocation if you did such a thing suddenly, seeing that the foreign-controlled renters produced 35 of the .worth while British films last year as against 113 altogether, so that obviously the British production of films is not yet big enough to enable you to drop out these people producing in accord- ance .with a foreign-controlled renter-' quota. I only asked the question as to what might happen .when the industry got stronger, and your answer is that you do not foresee any prospect of that?— (Mr. Korda): I do not foresee any immediate pros- pect of that. 184. (Mr. Cameron): Is it the view of producers that eventually the renters' quota is a thing to be eliminated ?— (Mr. Kearney): Eventually, perhaps. (Mr. Baker) : Yes, with ^the reservation, of course. that there shall always be a quota of British pro- ductions on the screens. 185. (Chair-man): Yes, the exhibitors' quota is the effective thing? — (Mr. Kearney): I wonder if I might answer; I do not want to depart from your ruling that only one of us should speak, but you referred quite early in this meeting to our having said that the majority of renters were foreign and the minority were British. May I say that that really refers to the principal Tenters. That there are registered with the Board of Trade a large number of renters I do not doubt, just as there are hundreds or thousands of companies registered at Somerset House which never function. There are many renters who distribute one picture or a few pictures. Of the main renters (perhaps a dozen or fifteen), the majority are foreign, but they are technically British in that they are registered British companies ; but their interests are entirelv foreign. That is the position. 186. Well, shall we come to paragraph 14, wbere mention is made of " barring clauses " You say they are a handicap on exhibitors. It seems to me that they are rather to the advantage of exhibitors. It is a mystery to the people outside the industry ho.w you avoid overlapping, how an exhibitor can be sure that when he has arranged to show a film at a certain date, somebody within reach of his public will not have shown it just before, and is it not essential that you should have some such arrangement? — It is, my Lord; we must have a contract. A contract is entered into, we will say, by A theatre and automatically B, C, D and maybe others are prevented from showing that same film. and that operation is called barring. They exhibit a film and thereby one. two or more theatres are prevented from showing that same film because they are in the locality. 187. Well, you could not do without that. You say that if the operation of the " barring clauses " makes it difficult for exhibitors to obtain sufficient British pictures for quota purposes, they have the remedy in their own hands. They could not drop the barring arrangement, could they?— Yes. The complaint, if I may say so, is that certain theatres perhaps take an unfair advantage of their position or power and bar more theatres then they would reasonably be entitled to do. (Mr. Korda): Chains of theatres. (Mr. Baker): Chains of theatres; and we say, " Well, that is very unfortunate, but it is a contract between a renter and an exhibitor," and the remedy is in the bands of the exhibitors themselves to prevent these unreasonable barring clauses. 188. These unreasonable barring clauses? -{Mr, Kearney): You see. my Lord, the exhibitors claim that there are not sufficient British films to go MINUTES OF EVIDENCE 45 12 May 1936.] Mr. F. W. Baker, Mr. M. N. Kearney, [Continued Mr. A. Korda, Mr. N. Loudon and Captain the Hon. R. Norton. round, so to speak; that the barring clauses add to their difficulties, and that therefore there should not be- so high a quota, as at present. That is as we understand one part of their line of argument. Pro- ducers as such do not take any exception to the barring clauses which are not their concern. All they say is that if, in fact, the barring clauses tend to make the supply of British films inadequate for quota purposes and add to exhibitors' difficulties, then they have the remedy in their own hands because they can modify the barring clauses. That is the whole point of that. 189. But do you, in fact, think these barring clauses are being unreasonably used?— There are doubtless cases where they have been used for un- reasonable purposes, but that is not the concern of the producers. 190. (Mr. Cameron): May I ask one more ques- tion on that point? Is it not a fact that actually the barring clauses become more a difficulty in con- nection with the exhibition of foreign feature pic- tures, big American pictures?— (Mr. Baker): No, it is the same for all films. 191. But does not one mostly hear of the difficulty of barring in connection with the foreign feature pictures rather than British pictures?— (Mr. Kearney): Yes, because there are more of them. 192. The difficulty has been urged more in that connection? — It is not disproportionate, but only because there are more foreign pictures than British. 193. It applies equally with British pictures in a similar manner ?—(Capi. the Hon. B. Norton): I think you could answer that by saying the better the picture the more it is barred. 194. When there is competition the big feature picture, British or American, tends to be more barred ?— Yes, 195. (Chairman).: Then in paragraph 15 you suggest that the evasion of blind bookings might be stopped by statutory declaration once a year. If declaration is considered to be the best method, would it not be more effective if a declaration had to be. made on each individual film at the time of presenting it for registration? — (Mr. Baker): Yes, my Lord, I think that is so. (Mr. Kearney) : We only suggest a possible method for consideration. (Mr. Baker) : If the Law Officers of the Crown can find a better method it would be of great service to the industry. 196. In the next paragraph you talk about the booking of these " quickies " blind. Do the ex- hibitors really make these arrangements before the trade show? — Yes. (Mr. Kearney): The distributors and the exhibitors. When a renter has a first class foreign picture to distribute, there is competition to get hold of that picture among exhibitors. The foreign renter has to supply a certain proportion of British in order to match it. He can then go with picture " A " and say, " I am offering picture ' A ' with a series of others, plus the quota, I am not offering you picture ' A ' only, I am offer- ing you the lot — take it or leave it." That is what it amounts to, boiled down. There may be pictures booked outside the dates allowed by law. Strictly speaking there is no contract by law, the contract could not be enforced, but should the agreement or understanding not be completed when it is legally possible to complete it, it is open then for the renter in future to say, " I am sorry, Mr. Exhibitor, I am not selling you any more pictures in any circumstances." 197. But there is often a try-out in addition to the trade show, is there not? — Not very often. Sometimes, but that is for a different purpose. The " try-out " is rather to see whether the film as cut and finished is suitable for showing to the public, and if necessary, so that it may be modified before registration and final showing. 198. That is after the trade show?— (Mr. Baker): No, my Lord, before the trade show. A try-out is sometimes of importance; it is just a show to a number of people— a packed hall preferably— so that the producer and other persons concerned can get the reaction of audience before they finally trade show the picture. 199. You come to that later on, but you do not attach great importance to it? — Not vital import- ance. It is a question of helping the producer to gauge the public taste. (Capt. the Hon. R. Norton) : It is only for cutting purposes. 200. Then in paragraph 18 you make very important recommendations. First, you want to change the method of calculating the percentage. You want to have it as a percentage of foreign films rented. Is there anything but arithmetic at the back of this proposed change? — (Mr. Baker): So far as the exhibitors are concerned there is no difference, but in respect of the renters' quota it will, we believe, encourage the production of more films by perhaps the lesser, or the all-British com- panies, in as much as they would only have, to make films to comply with the quota in respect of the foreign films that they import. It is a little bit difficult, my Lord; but supposing we take the figure of 100, as the total of a renter's annual registrations, and that 100 is made up of 70 per cent. British films and 30 per cent, foreign films. The present Act compels the renter to acquire British quota to the extent of 20 per cent, of the total. Supposing, however, only 30 per cent, of that 100 are foreign films, then 20 per cent, of that 30 per cent, is a very much less quantity of films than 20 per cent, of the whole in respect of which he has to comply with quota conditions. An important purpose of the suggested alteration is that it will encourage the setting up of new producing units in this country without any condition as to. the type of film that they should make, because such films will be British and made by companies having a real British policy. 201. Well, I quite see that, if you increase the quota, but I cannot see that it makes any difference whether you express it as a percentage of the whole or a relative proportion? — Yes, there is a difference. (Mr. Loudon) : My Lord, in answer to that question, we have made certain recommendations later on in the memorandum for a minimum price quota and also for labelling certain pictures, and that recommenda- tion is based on the fact that renters' quota pictures, shall be a percentage of the foreign footage im- ported. Any other pictures will be quite free and will not be labelled as quota pictures. The position is that foreign renters imported from British Domin- ions, or acquired in this country, last year, 111 British pictures, and British renters acquired 104. Now, the 111 British pictures which the American renters distributed are in our opinion mainly the pictures which are causing all the trouble, and which are doubtless quota " quickie " pictures, and these are the pictures which we want to see im- proved. We want them to be labelled. If the foreign controlled renter acquires or makes such bad cheap British pictures then he ought to live and be asso- ciated with them. That is the reason we propose changing the method. We propose changing the method of calculation from the total footage to the foreign footage in order to pin the responsibility for poor quota pictures on to the renters who inspired their production, and also to ensure that such pictures shall have a minimum amount of money spent on their production. (Mr. Kearney) : There is a reason too, my Lord, other than one purely of mathematics. I do not think you want me to explain it in detail, but there is a reason other than mere mathematical calculation. 202. I am puzzled about it. — (Mr. Baker) : Can T. my Lord, give the reason 203. I think Mr. Kearney has something Ik- wants to tell us? — (Mr. Kearney) : I think I can explain it fairly briefly. By the present regulations if is laid down that the renters' quota (leaving aside the exhibitors' quota for the moment), shall be a pro- portion of all films rented. Unquestionably, which ever way you work it you get the same result, bul 46 COMMITTEE ON CINEMATOGRAPH FILMS 12 May, 1936.] Mr. F. W. Baker, Mr. M. N. Kearney, Mr. A. Korda, Mr. N. Lotjdon and Captain the Hon. R. Norton. [ ( "iitniued. by our proposals we suggest that some films shall be " labelled." We suggest that films costing less than a certain minimum shall, if registered for renters' quota, be described for what they are and that the public shall know it; we also suggest that cer- tain films shall not be eligible for renters' quota at all. At present all films must be registered and all British films so registered are eligible to serve for both renters' and exhibitors' quota. Furthermore any film not deemed by the terms of the Act to be British is classified as " foreign." If our proposals are accepted the result will be that certain British films will not be eligible to count for renters' quota, but they may still be distributed by renters, and should the latter have to acquire a percentage of British quota in respect of all films rented it would necessitate their finding British quota to match certain British films as well as foreign ones, and also to match films imported from the Dominions. This would be unfair to renters. We suggest, therefore, that in future the proportion of British films to be acquired by a renter should be a percentage of the foreign films he handles instead of a percentage of all films handled. This woidd in no way modify the proportions of British film to be obligatorily acquired for quota purposes ; it is merely a different method of arriving at the same result, which would be advisable if not essential if our other proposals are adopted. There is not the same need for modifying the method of calculating ex- hibitors' quota, but if the method be altered in com- puting renters' quota it would be desirable, for the sake of uniformity, that the methods of calculating both renters' and exhibitors' quota should be identi- cal. (Mr. Baker) : May I give a simple illustration, my Lord? I am a British producer and during a year I distribute 25 films. Of those 25 films, foreign or British, I am compelled to have not less than 20 per cent. British, therefore my liability is 5 British films out of 25, British and foreign makes. Supposing, however (as I am), I am mainly concerned with British films and do not import American pictures and I put out 25 British films a year — this is an extreme case— my liability under our proposals would be nil, because I import no foreign films, and therefore I am free and encouraged to make films and live by selling those films on their merits. If I do not make successful films, quota or no quota, I shall not be able to sell them. 204. (Mr, Cameron) : You can do that at present, can you not? — Yes, but at present my quota is on the total footage, including those films that I make. 205. (The Hon. Eleanor Plumer) : May I ask one question ? Does Proposal 2 depend on the acceptance of (h) lower down ? — Yes. 206. I see. I did not ifollow before? — Yes. For instance, Mr. Cameron, take Metro-Goldwyn, they have 50 films a year, and they are compelled to make 20 per cent., that is 10 films. That is their liability. There is no reason why a British producer who is mainly distributing British pictures should have the same liability ; he should only have the liability on the foreign films that he imports in the same way that the American renter has the liability on the foreign films that he imports. 207. (Mr. Cameron): I see. I thought that was the position now?^No, the quota is now on the total, they are all bunched together. If I had 50 English films and 50 American films they are put together and my quota is on the total. 208. T see that, but that is a mathematical point? — Yea, but it is important. (Mr. Loudon): Every British picture now is a quota picture, but we are changing it round so that a quota picture is a picture that counts against the foreign footage. 209. Then 25 per cent, on the proposed basis is more important than 20 per cent, on the old basis? — It is the same thing in actual figures but it is more important from the point of view of what it does. 210. Yes, T see? — I hope, my Lord, you appreciate the position we have explained. 211. (Chairman) : I am still not convinced that it is anything but an arithmetical calculation, but it is a preferable way in your opinion and if there is some difference I shall read the evidence and probably 1 shall understand it from that. You are satisfied that the cost test of quality is the best one, and you do not deal with any other test. Do you think that it is safe to rely on that, that it will not cause extravagant production measured by cost? — Well, we have kept the figure down reasonably moderately, my Lord, having that point in view. 212. And if you adopt the cost basis do you con- sider that Form C is the best measure to take for it, in preference to the total cost? — Yes, we are all agreed that it is better to have the cost on what is familiarly known as Form C. 213. To exclude the cost of the story and copy- right?— Yes, only taking into account the cost for Form C. 214. Where you take the stigma basis that you propose, or any other basis, do you think that it is reasonable to legislate rigidly for 10 years, or should some power of adjustment be reserved to the Board of Trade? — Well, in a business such as the film busi- ness where plans are made so very far ahead (book- ings for instance are six months ahead we know) production must precede bookings, therefore arrange- ments are made two or three years ahead, and any- thing less than 10 years, I am afraid, would destroy the confidence that now exists in the permanent establishment of the British film industry. Anything less than 10 years, I think, my Lord, would be worse than it is now. 215. Then your stigma proposals are embodied in paragraph 18 (b) and there you say, " for a maximum period of 30 to 40 seconds " — is that a misprint for "minimum"? — (Mr. Kearney): Yes, it should be " minimum." It is a clerical error. 216. I thought so. There is a point of substance which rather puzzled me in one of these proposals. The films which cost less than 15s. per foot are not to rank for quota, they are below the stigma class, and the films which cost more than 25s. per foot are above the stigma class? — Yes. 217. Is there not likelihood of considerable confu- sion between those two classes on the part of the public that see the films, and if they see films which are so bad as not to justify inclusion even in the stigma class, will that not do a great deal of harm to British reputation? — (Mr. Baler): Our view is, my Lord, that the first class will not be made. (Mr. Kearney) : We suggest they should not be admitted at all for renters' quota. (Mr. Baker) : In practice, my Lord, the first class that you referred to will not be made, or if they are made they will be booked only on their merits. Obviously the American com- panies will not make such films because they do not rank for renters' quota, therefore the American renters will not make them as " quickies ", as it were, and if other people make them they will not be shown except on their merits. There is no in- centive to make such films and that particular cate- gory, in my view, is not very important. Those films will not be made. What I think may be made, ray Lord, is a certain number of semi-documentary films that can be made at less cost than in tlu- second class by British companies, and they will be shown and exhibitors would be willing to book them because they carry exhibitors' quota. I see no danger there at all. The films will not be made for those people who are only interested to acquire cheap British films for quota purposes, because they will not rank for quota. 218. No. they will not be made by the present people who make them to satisfy the quota require- ments :j- No. they will not be made by those people, 219. But you told us exhibitors say they have been finding difficulty in getting British films to show? — Yes. 220. Is there not danger if the foreign-controlled companies give up producing these cheap films for MINUTES OF EVIDENCE 47 12 May, 1936.] Mr. F. W. Baker, Mr. M. N. Kearney, Mr. A. Korda, Mr. N. Loudon and Captain the Hon. R. Norton. 1 1 'ontinued. quota purposes? The exhibitors will still provide them, because of the difficulty of the small man in getting an adequate supply of British films? — No, the American renter will still be compelled to make his quota of British pictures. That looks after the exhibitor's requirements, but this is a class of film, as I repeat, which would not be made by the Ameri- can distributors. 221. Not by the Americans, I quite see that? — Because they do not carry any advantage, but other people, British companies, might make those pictures and it is a fluke, in a way, if it was a cheap picture and a good picture. Well, then the exhibitors can book it and show it, and it carries exhibitors' quota, and if it is of a certain value, one can conceive certain pictures that might be made which would be a help to a certain class of producer. (Mr. Kearney.) They would sell on their merits. 222. I gather from that that you recognise that the cost test is not the sole test which is applicable in all cases? — (Mr. Baker): Oh, yes. 223. Well, would it not be better, rather than to risk the confusion of the output of very cheap films of poor merit with the good films in the minds of the public, to have some test other than cost in exceptional cases, that people should be allowed to go to the Advisory Committee or some other suitable body and put tip a case for special exemption from the 15s. requirement on the ground that the films are so good?— (Mr. Kearney) : Yes, we were going to pro- pose that too, that they should in certain cases, if a film had particular merit (Mr. Baker) : The provisos to Section 27 of the present Act would con- tinue. 224. You recognise special exhibition value as justifying exemptions from the 15s. limit? — Yes. (Mr. Kearney): Perhaps I might give very briefly the reason for that second qualification. The reason is this : if the suggestion we have made, that no films costing less than £1,250 per reel, on Form C, should be allowed to serve as renters' quota without the "label" is adopted, the foreign renter might say, " I am acquiring a British picture and it is going to be labelled; it is going to have the stigma of the label anyhow," and instead, therefore, of acquiring a picture costing over 15s. a foot (Form C), he might acquire one for a couple of thousand pounds or less and use it for renters' quota with the label. That is the reason for having the second qualification, that no picture costing less than 15s. a foot shall be eligible for renters' quota at all. (('apt. the Hon. B. Norton) : I think the Chairman has put a very trenchant question that we have not answered. The question was whether the exhibitors would make bad films for exhibitors' quota. We have not answered that. (Mr. Kearney) : They can do that to-day, but they do not. 225. Yes, but there is less incentive to-day, because they can get lots of cheap bad films with- out producing for themselves? — The trouble is not that there are plenty of bad films, but it is the exhibitor who takes exception to the bad films, because he cannot make money on them, he does not want to have any more. 226. (Mr. Cameron): It is against his interests? — It is against his interests if he likes to take bad films, and it depends on whether his public will let him do it. 227. (Chairman) : Then you would rely entirely on special applications on grounds of merit to let in these cheap films? — (Mr. Baker): I do not think too much attention ought to be paid to those films, because in my view those films do not exist and never will in any serious quantity. It does not warrant the amount of time we are spending on it, because they will not be made. 228. Then in paragraph 18 (d) you mention the tendency to show bad British pictures in slack hours. Have you any definite remedy in mind for that? — It is very difficult to suggest a remedy, my Lord, but it is a known evil, and I think that the Board of Trade have prosecuted in one or two ca I think the classic case was at Weymouth, it I remember rightly, where the exhibitor reduced his prices during a certain period of the day, and during that period of the day showed a British picture and said he was showing a British picture at reduced prices, and his programme proper came on at a later period. In another town, I think that was Horsham, an exhibitor said, " Well, we are showing British films at a certain theatre early." 229. But I suppose you can get over that by saying that each programme must be repeated in the same form? — The Act does prevent it now, but the suggestion is here that it might be strengthened. I do not think we want to put it any higher than that. 230. You do not think the Act is enforced. It is failure to enforce the Act? — It is failure to en- force the Act. It is difficult to enforce it because obviously it depends on your inspectors, or do you call them " common informers," who report these things to the Board of Trade for prosecution. 231. Well, it must be a false return? — Not neces- sarily, my Lord, because they return the films as having been shown during the normal hours of showing. Perhaps their conscience prevents them stretching the normal hours of showing to com- mence, we will say, at 2 o'clock in the afternoon or in the morning. 232. Yes, but if you made each programme the same, however many times they repeated it in the day, then you would be sure that the quota should apply with each programme? — The Act does not compel that. (Mr. Kearney) : The Act says, " The registered British film which has been exhibited during the normal hours in the ordinary pro- gramme," so that the Act does say so to-day. 233. It does not say you shall have two ordinary programmes in one day, that would be the remedy? — (Mr. Kearney) : There is a way of getting round it. The intention of the Act was that exhibitors should only show the British films in the ordinary run of the programme, but some of them show poor quality British films in the " dead " hours only or mainly. 234. Then we come to " short films " in para- graph 18 (e). I understood that the production and exhibition of short films was declining, but I was rather surprised to hear to-day Mr. Baker say that it was not so? — (Mr. Baker) : The produc- tion of short films has never been a very serious factor in the British film industry. I think I said that the outlook was a little more encouraging. 235. Is it because of the convenience of exhibi- tors, they like to have two long feature films? — One of the reasons is the fact that most of the exhibitors in this country require or desire to show two long feature films, but another reason is it is economically difficult, if not impossible, to produce short films in this country commensurate with the return that one can reasonably expect from those films. 236. So far as it goes the quota helps them, it is worth keeping them in the quota? — Yes. 237. If you omitted them from the quota it would be even .worse? — Yes. 238. Would you recommend that the stigma re- quirements should be applied in exactly the same way to the short films? — Yes. 239. Would the cost be modified at all? — Yes, the cost is set out differently? — (Capt. the Hon. I'. Norton): In paragraph 18 (/). 240. Is it not the case that in these films there are a smaller number of artistes employed generally in the shorter films? — (Mr Baker): Oh, yes. 241. Therefore would the Form C basis be so suitable ? — There are a smaller number of artistes, but I think it is in proportion to a more important picture. (Capt. the Hon. B. Norton): Labour is included in Form C too. (Mr. Baker) : 48 COMMITTEE ON CINEMATOGRAPH FILMS 12 May, 1936.] Mr. F. W. Bakkh. Mr. M. N. Kearney. [Continued. Mr. A. Korda, Mr. N. Loudon and Captain the Hon. R. Norton. Yes, labour is included and labour is definitely pro- portionate to the length of the film. I'll'. Then in the same paragraph, Proposal 5, all films screened to bear a legible title saying whether they are made in the United Kingdom or in the British Overseas Empire or in a foreign country. How would you deal with films shot abroad by the British producer? — Well, that is covered in the proposals and in the present Act. It is a British film and it would be made in Eng- land. It would bear the label, " Made in England." There is only a proportion of that film which can ever be shot abroad. That is covered in the regula- tions?— (Mr. Kearney): The" present Act describes a British film as one made by a British subject or company of which " the studio scenes must have been photographed in a studio in the British Empire." A film partly photographed abroad by a British company can be British by the present Act if the regulations are complied with. (Mr. Korda) : At any rate the shooting of that picture, the place of the shooting, is really the place where the picture is made. (Mr. Baker): The studio. (Mr. Korda) : I did not quite mean that, but if you make half of a picture in France, but the picture is conceived and cut here in this country, it would not be fair to say that the picture was made in France. It is partly shot in France, but the picture itself would be a picture essentially made in England. 243. Then Proposal 6, " Provision to be inserted in the Act effectively to prevent renters from re- quiring exhibitors to hire a British quota picture of the type referred to in Proposal 2 (o) and (/) as a condition for the hiring of a foreign film "? — That is to prevent the block hiring of the quota quickie, if it is possible. 244. There again, how would you do it? You have failed to find any solution for block booking so far. Have you got any new idea ? — (Mr. Baker) : We agree it is very difficult, but at any rate there is some advantage in having in the Act that such an offence is a punishable offence. There is some deterrent, I think, even if one cannot get 100 per cent, observance of it, or discover the offenders, I think there is a considerable advantage in having it framed in the Act as an offence. 245. (Mr. Cameron): If the "quickie" is not to be produced it cannot be booked? — (Mr. Kearney) : But if the " labelled " picture, the " stigmatised " picture, which would obviously not be a picture up to the worthwhile quality, can be forced on the exhibitor by the renter together with other pictures that he does want, it would give it more showing than we think it merits, and we sug- gest that if possible there should be some way of preventing that' being done, making it a. legal offence. It may still be done but it is an offence. 246. (Chairman): Do you feel that any provision ought to be made against block booking generally. Do you all feel it is desirable to cheek block book- ing?— (Mr. linker): Yes, this is one of the means of doing it. 247. Would you go further and make block book- ing illegal, that it should never be a condition of taking a good film that you should take some other film? — Yes. (Mr. Korda): I think it would be very, very good. 248. Would it be practicable?— (Mr. Baker): Well, it would be difficult to find the offenders. (Mr. Korda): It would be practicable. (Mr. Baker): It would be practicable to do it. (Mr. Korda): It could be done. 249. It could be done just as effectively by declara- tion as in the other cases? -{Mr. Baker): Yes. the 9ame principle could apply. 2-50. If you are going to have these declarations I suppose you might apply them to both? — (Mr. Korda): Certainly. {Mr. linker): Yes. 251. There is one other question raised which seems to me to be rather outside the scope of this Com- mittee, and that is about the child labour. I under- stand that you are in touch with the Home Office about that? — (Mr. Baker): Yes, it is outside the scope of your Committee. 252. We are appointed by the Board of Trade, so I think we ought probably to restrict our activities? — Yes, that is so. (Mr. Kearney): Might I make one very brief observation, with regard to the ques- tion of employment of children ? The reason we put that into our proposals was this. The condi- tions are more or less accepted by the Home Office, but the question is how the matter of employing children for portrayal in films shall be brought before Parliament. We have made suggestions that it should go into various Bills, but no decision has been reached. It would seem that re-enactment of the Films Act might, be an opportunity for bringing it forward — a practical method of bringing it for- ward. That is the only reason for our having raised this point. 253. I think the best course would be for you to remind the Home Office, when legislation is coming along, of their favourable attitude, so that they will not forget it? — We thought this might be the moment to introduce it if there is legislation. 2o4. Then you speak about the Dominions in Proposal 10. You say, " no British territories, with the exception of certain of the smaller Colonies, have introduced and applied quota legislation in favour of British films." Is not New Zealand an exception ?— No, because it is not enforced. 255. Is it only not enforced because a voluntary arrangement has been made for it? — It exists, but has not been put into force. 256. Does it not apply to renters but not to ex- hibitors, because exhibitors are already complying with the requirements? — The}" are showing more than the requirements now. 257. Well, in Proposal 11, you suggest that a scenario writer should be exempted from the re- quirement of British nationality. Is he not a very important factor in getting British atmosphere into a film? — (Mr. Baker): Yes, my Lord, that would probably be the right criticism to make, but pro- ducers have felt that they ought to have for the good of the industry generally and the works that they produce, liberty and freedom to consider it internationally in somewhat the same way as is done with music. One should not be prevented from using a man as author of the scenario who is a foreigner if he is a brilliant man. 258. Of course, we have the very definite object of helping the British cultural point of view? — Quite, my Lord, but I do- not think it can be conceived for one moment because the author of the scenario is a foreigner that that will be reflected in the film. The film is made in England and I do not think there is any danger of any but British atmosphere being in that film. I do not think it is possible to get a German atmosphere with a film made here although the scenarist may have been a German. L'oi). The only other question I want to ask you, which does not arise in your memorandum, is in connection with the 16 mm. films. I understand they are shown a good deal in small halls throughout the country. Do you think any regulation should be applied to them- Is there any importation of 16 mm. foreign films? — Oh, yes. but the amount of L6 mm. film gauge that is shown professionally is insignificant. I do not think wo attach any import- ance to it whatsoever. We do not discourage the use of the 16 mm. film. On the other hand. I think it is encouraged for educational and other purposes, but I do not think w e are very much concerned with it in these deliberation-.. 260. (Chairman): Thank you very much. MINUTES OF EVIDENCE 49 12 May, 1936.] Mr. F. W. Baker, Mr. M. N. Kearney, [Continued. Mr. A. Korda, Mr. N. Loudon and Captain the Hon. R. Norton. 261. (The Hon. Eleanor Plumer) : My first ques- tion is on your " General Observations ", para- graph 2, where it is stated, " The number of worth- while British films available for exhibition in the near future will greatly exceed the present supply of such pictures ". Are those pictures, that increased number, likely to be available for the independent exhibitor or will they be made mainly by the large companies which control circuits? — No, the tendency is the reverse. The tendency is that new producing companies are springing up and are increasing. This expansion is mainly due not to the extension of existing producing companies, but to the inaugura- tion and building of new studios under other con- trol, and obviously, therefore, those pictures will be available for independent and whatever other exhibitors you call them. 262. I see, because that is the complaint that one hears from the exhibitors' point of view at the moment, that the worth-while British films are not available to them, that they have not the choice, that there are the two types of British films, the verv good and the very bad ? — Yes, I think you have a suggestion that the extension of the British pro- ducing industry is the increase of existing studios or studios that have been built during the early period of the Act. The increase of British produc- tion is not in that line at all, it is mainly in the line of new studios that are being built under other control, and with other brains and capital, and so on, which is all to the good. 263. Definitely, and that will tend to meet the difficulty ? — Yes, definitely. 264. And when you go on to say that the vast majority of exhibitors can readily fulfil their obliga- tions, in paragraph 12, I imagine that you would not find at the present moment cordial agreement with you on the part of many exhibitors? — (Mr. Kearney) : That is a fact which is proved by the official returns of films which have been shown. The majority of exhibitors do not experience difficulty. The instances of hardship are few and if many more good British films are available, which is what our proposals seek to ensure, there should be no difficulty at all. (Mr. Korda) : I think the difficulty is not with the independent exhibitors. The difficulty is only and chiefly in cases where a company has four or five theatres in one town ; for instance, the Gaumont-British have five picture theatres in Oxford which they have to take care of, and it is difficult to find enough different British pictures for each of their five theatres, but if the independent exhibitor complains about not being able to get worth-while British pictures I do not think he is right. 265. And you think the increased production envisaged would be sufficient to meet the increased quota? — (Mr. Baker): I think so. 266. Then a good deal has been said about the point you raised in paragraph 15 on advance book- ing, and you say that it is a question of fundamental importance. Is it not a question of equal difficulty, because there does not seem to be any solution? Is it quite satisfactory to leave the solution to the Government's legal advisers, do you think? — I do not think we have any better suggestion for a solu- tion than the Government's legal advisers. It has had their attention for a long time. 267. Yes, they drew up the Act?— Yes. 268. I wonder if they have had more inspiration since then? — (Mr. Kearney): They may have been inspired since that time, they have had eight years in which to develop inspiration. Experience has proved how the Act can be evaded, so it is necessary to tighten things up. 269. Then in paragraph 18, in connection with the scheme for proposed minimum cost, is it likely that that figure would be effective if and when colour comes, or would that figure be too low? — (Mr. Korda) : These colour pictures will not come in in quantity for the next five or ten years. 30152 270. Then in paragraph 18 (e) you suggest that documentaries should be included in the short quota requirements, do you not? — (Mr. Baker): Yes. 271. I see you suggest a minimum figure for them, but is it possible to lay down a figure like that, because is it not a fact that the cost of documentaries varies very considerably? — Yes. We rely upon Section 27 (I) (i) to take care of any films that may be below the price, for which an appeal can be made as being of special exhibition value. 272. But do you not rather suggest that they should have the stigma? — No. (Mr. Kearney) : Only, that is, if it is registered for renters' quota. You can register for exhibitors' quota under Sec- tion 27 (I) (ii). 273. And would it not take away the benefit? — No, I do not think we wanted to suggest that. 274. Then in the same paragraph I do not under- stand the force of Proposal 12 : — " This restriction has been found in prac- tice to operate to the disadvantage of British producers as compared with their competitors abroad." 1 do not quite understand that? — In Hollywood they can always try out a film before they get the final version of it. They try it out in a certain num- ber of theatres. They ascertain the public reaction to it and they modify it if they find the reaction is not favourable. Here you may not do that. (Mr. Baker): My Lord, we do do it in fact with the knowledge of the Board of Trade. Many pro- ducers in this country, desirous of getting the public's reaction to a new film, do show the film at a theatre unannounced, and the Board of Trade understand the position, and there has never been any action taken, but they have said it is quite improper to do so. It simply means provision in the Act could be made or should be made. 275. (Chairman) : I am told it is not allowed to the extent that is suggested here? — No, it would have to be controlled, as it were. What the pro- ducer wants is a try out of a film. (Mr. Kearney) : They may do it in the case of one theatre with continuous showing now. They have done it in many instances in more than one theatre with, I think, the cognisance of the Board of Trade, who have to some extent slightly turned the blind eye, if it has not been overdone, but the Board of Trade obviously cannot overlook an irregularity if pro- ducers or their renting organisation advertise the fact that they are going to do it. (Mr. Korda) : It is a help to see if a picture is not too dull or not too long, or partly not too dull and not too long, if a comedy has its comic effect or not. 276. Is it helping the cutting?— Yes. (Mr. Kearney): Before final registration. (Mr. Korda): That is the sole purpose. In Hollywood they show every picture before it comes out, it is tried out four or five times by different audiences and it is found very useful to judge the final cutting of the picture. (Capt. the Hon. It. Norton) : I think our memorandum should have stated that there should be a limit to the trial of five showings so that the Board of Trade could take steps if there were any improper trial. (Mr. Baker) : I feel that the Board of Trade understands the situation and when the new Act comes to be framed it will bo looked after. There would obviously have to be a limit, but on the other hand producers are not likely to be showing their new films all over the country because that would destroy the value of it. (Capt. the Hon. B. Norton): They do not get any money for it. (Mr. Baker) : They do not get any revenue from it. 277. (Mr. Cameron): Most of my points have already been covered. There are just one or two questions I want to put. I quite understand, Mr. Baker, it follows from the memorandum that ii' a much bigger quota were put up, as you suggest, there would follow production of British films by these independent companies, but from the point G 50 COMMITTEE ON CINEMATOGRAPH FILMS 12 May, 1936.] Mr. P. W. Baker, Mr. M. N. Kearney. [Continued. Mr. A. Korda, Mr. N. Loudon and Captain the Hon. It. Norton. of view of the consumer are these new companies starting up without resources in the background, and are they going to have the capacity to produce really first-rate pictures? — My view is that the facilities in the newly erected studios, or the pro- posed studios, are considerably in advance, their prospective output will be considerably in advance, of any quota that we have suggested, and I can see activity in that field increasing considerably. There is every evidence, we see it all the time in the business, in these new promotion schemes for studios, and so on, and I have every confidence there is more than ample studio accommodation to-day to fill this new quota which we suggest. 278. I am thinking more of quota. Is there a danger that I, as a member of the public, may have to go and see genuinely produced British films which are indifferent in quality because of lack of resources instead of a first-rate foreign film ?■ — I do not think the danger will be increased. (Mr. Korda) : It de- pends largely on whether £10,000 or £200,000 is spent on a picture whether jou see a bad picture or not. 279. But the working of the Act is that concur- rently with the increased quota the quality of the genuine British pictures is improved? — (Mr. Baker) : Yes. 280. So that they can challenge the best products from abroad ? — Yes. 281. If you go up by sudden mutation ?— It does not go up suddenly ; the scale we propose goes up just as gradually as the existing scale- did. 282. And much more suitably? — (Mr. Kearney): Slightly more quickly, perhaps. 283. And it is your view that the public will not suffer by the growth in the quantity of British pictures? — I think if they suffer at all they will " suffer " in the opposite sense to that which you suggest, that they will get a much better quality of picture in the future than they have had in the past. 284. It is an important point? — Yes. (Mr. Korda) : If, let us say, through a new quota, 15 per cent, of foreign pictures or American pictures were excluded from this country, obviously the 15 per cent, would be the worst of the American pictures and not the best. The pictures which are really good would still come in if there were a 75 per cent, quota, but the lower strata of American pictures — the very bad American pictures — would be eliminated from the British market. I dare say there would be lots of bad British pictures, you can- not help that, I do not think there is any legisla- tion in the world which could help that, but cer- tainly you might substitute indifferent British pictures for very bad American pictures; but the good American pictures would come here just the same. 285. But would you agree, from the ultimate object of the best for the industry, it is desirable that the average quality of British pictures should tend to improve, as it is improving? — Yes. (Mr. Kearney): ( lertainly. 286. And not to risk a set-back by over-produc- tion numerically ?— That is so. (Mr. Loudon): The new technical facilities that exist to-day in the country, and that will be here when the new studios are completed, will improve considerably. (Mr. Kearney) : Very vast sums have been expended in the erection of studios in the last few months, and further considerable sums are still being spent to- day; and they are not being spent solely for the purpose of producing bad pictures. 287. Quite. One other point on that same cultural question. There is a type of film that has just been referred to by Mr. Korda, the foreign film, the European film, of admittedly cultural value, which it is difficult to get into England and to distribute- in England owing to the difficulty of finding renters' quota? — (Mr, Baker): What film are you referring to? 288. I am referring to cultural films from the Con- tinent?— Those which are shown at the Academy, and so on? 289. Yes? — Well, the main reason why those films are not imported into the country, is that they are not commercially practicable. (Mr. Kearney) : They are not understood because they are recorded in a foreign language. There is nothing in our legisla- tion to prevent their import, and we do not want in any way to discourage the distribution of such films. (Capt. the Hon. B. Norton): I think they get as full a showing as they deserve commercially, if not culturally. (Mr. Korda) : The situation is exactly the same in France, the whole of France will not play a British picture. Our pictures are played in France in small theatres of 400 or 500 seats, and we are allowed 14 other cinemas in the whole of France. They make exceptions for pictures of very special distinct merit, but if we want to play our pictures in the other cinemas of France we have to put French language instead of English which makes it sometimes very amusing and sometimes very strange. (Mr. Kearney) : You mentioned that the foreign picture finds difficulty in securing a renter to rent it and provide the British quota. The reason is not that the renter has any objection to the foreign film in itself; the reason why the renter will not provide English quota to go against it is that the foreign picture you are speaking of will rent to so few exhibitors, because the general public apart from a few specialised audiences, does not under- stand foreign languages. 290. That is the point, but if you increase the renters' quota you may make it still more difficult to import films with a limited circulation. I do not want to make it more difficult for them to come in? — (Mr. Baker) : My Lord Chairman, Mr. Cameron is dealing with a very limited number of films of a very special class that are shown only at the Academy and such-like theatres, and there is no real difficulty in bringing those films into the country; and if I may just correct what has been said, the Board of Trade has not taken very serious notice of the default of (say) the Film Society. They have not complied with the quota for obvious reasons, and I know that the Board of Trade have not looked upon that seriously at all. They have permitted these films to be shown and have not compelled the par- ticular renter to supply the quota. 291. Thank you. On a quite different point, is there any substantial market for British films out- side this country, in countries that are non-film pro- ducing, European countries? — You mean Spain, and so on ? 292. Spain and Central Europe? — Yes. the market in those countries is very poor indeed, because, of course, of the language difficulty. There is a market and the market is open not only to ourselves but to other countries. (Mr. Korda) : I do not think the markets are really poor. I think there is a very dis- tinct improvement all over the Continent. I would say, if there was a good British picture or a good American picture on the Continent to-day people would go to see a good British rather than a good American picture. (Mr, Kearney): Definitely, in certain countries,, in Scandinavian countries, for in- stance. (Mr. Korda): And in France and in Den- mark. (Capt. the Hon. B. Norton): For a big picture costing £200.000, 20 per cent, of its total revenue may come from foreign countries, hut a picture costing only a small sum to produce can earn no revenue abroad. (Mr, Korda) : But pic- tures that cost £10,000 or £15.000 have no difficulty whatsoever and every successful picture has a very important market on the Continent, and 25 per cent, or 30 per cent, of our revenue conies from overseas. 293. So that it is a market for your major pictures which is quite important0 — (Mr. Kearney): Quite important. 'JIM. Tn paragraph W (r). Note 2. I am not quite '•ure that 1 have gol this rifiht. you speak about stigma pictures. Then you go on to say at the MINUTES OF EVIDENCE 51 12 May, 1936.] Mr. F. W. Baker, Mr. M. N. Kearney, [Continued. Mr. A. Korda, Mr. N. Loudon and Captain the Hon. R, Norton. bottom, " If a good British picture were produced cheaply it should not suffer from the ' label ." Is not that rather contradictory?— (Mr. Baker): No, Mr. Cameron, but I think perhaps it is wrong that that word " stigma " should be used. I look upon this in a similar way to that in which I look upon a safety razor or any other article that is marked " foreign made." This describes the article. If it is a good article, if the film is a good film, that label cannot be considered a stigma, that is the argument there. If it is a good picture nobody minds what it is labelled, but if it is a bad picture there is the risk that the public and exhibitors will appreciate why it is a bad picture and blame will attach to the renter who handled it. 295. You argue on the one hand that the public will refuse to patronise such films, and that exhibitors would refuse to show them? — I think we can if they are bad. 296. But you go on to say, "If a good British picture were produced cheaply it should not suffer from the label." That is the point you intended to make? — Yes. It should not suffer if it is good. 297. Is it the same point as you made to Miss Plumer? — Yes. 298. Then surely they should not bear a label if disparagement were not intended? — No, not suffer from the label. 299. No, not bear the label?— (Capt. the Hon. R. Norton): No, the memorandum says, "Suffer from the label." (Mr. Loudon): The memorandum is right, they would not suffer from the label. The argument is that a film would not suffer by reason of the label if it was a good one, but if the picture is a bad one, the label accurately describes the picture, and who is renting it. 300. I should have thought it was a dangerous argument from your standpoint. In para- graph 18 (e) (i) and (ii) there is, of course, a great difficulty of definition there? — Yes. 301. I suppose that has been considered? — (Mr. Baker) : Yes. 302. I do not know, I should tremble to have to draft it? — That has always been the difficulty that the Board of Trade have had to contend with in the existing Act, and it will continue to be a difficulty, but it is not too serious a difficulty to define what are documentary or what are scientific subjects. The experience of the Board of Trade has been fairly satisfactory. 303. Am I right in thinking that there are very few quota " quickie " shorts being made? — (Mr. Kearney) : Very few. (Mr. Baker) : None. 304. Then you are rather dealing with indifferent shorts made abroad and imported and good shorts made in this country, is that a fair statement? — The first part of your question, there are no short films made as " quickies ", because they do not want to bother to make the short films for quota, they want length. There are only 54 registered. (Mr. Loudon): That is for the foreign distributors. . 305. So that the position in shorts is rather dif- ferent?—(Mr. Baker): Yes. 306. It is rather nursing a very promising part of the industry? — Yes. I said that I thought our pro- posals would encourage the production of more shorts and particularly of what might be termed shorts of a documentary nature in this country. I think that is the general desire too. 307. Yes. Now in Proposal 10, Note 8, you say, " Furthermore there have been instances of films made in the Empire for purely local purposes being acquired by foreign renters here at negligible cost for the sole purpose of serving as quota to match foreign films ". Is that a serious danger? — Oh, yes, definitely. There have been definitely very bad films, as bad as one can see, poor Australian films made that have been imported into this country or pur- chased by American companies to fill -the quota and, more alarming perhaps, Indian films that are to all intents and purposes unallowable in the country, 36452 although they comply with the provisions of the Act, and are British films. They have been purchased for a few hundred pounds. 308. And you anticipate real danger if that is not checked? — (Mr. Kearney): There is danger. (Mr. Baker) : It has been quite an evil during the running of the Act. 309. Then one last question. What is the exact implication of Proposal 14? — (Mr. Kearney): There is not a great deal in that. The only point is that there are to-day produced in England a large number of films which are not registered and there is no record of them at all. For instance, thousands of feet of news reel are produced, and of documentary films, and they are not recorded anywhere. It might be useful to have some record of them. 310. You have in mind 35 mm., they are not 16 mm.? — Yes, 35 mm. Most 16 mm. films are originally produced on standard size stock. This pro- posal is really only a suggestion of no special im- portance. 311. It is simply for keeping track of them? — There is no track at present, as you know, there is no record of so many films, and it might be useful to have one. 312. (Dr. Mallori) : Might I ask as to the total number of British films made per annum? — (Mr. Baker) : Per annum, that is given in the statement. If you have the schedule Annex, III. Actually the Board of Trade returns were 215. 313. I want to get the number of those films which are made under what I may call American inspira- tion?—111. 314. Would it be fair to say that those 111 films are on the whole films which will not assist British prestige? — Apart from nine registered by United Artists and a few others. 315. That means nearly one half of the total British films produced are produced by persons who are not interested in the good name of the British industry but have almost a contrary interest? — Yes. 316. At present they are able to put the total discredit of that production on to the British indus- try?— Quite. 317. As regards other bad British films, or not good British films, whose is the responsibility for the production of those? Is the responsibility to be laid at the door of small British producers who are inexperienced or have not enough capital or are labouring under some commercial disadvantage? — They are spread over. Every company, whether the largest or the smallest, will make a proportion of poor films — not deliberately? — (Mr. Loudon): If you make a poor film you, of course, stand to lose the money put into the picture. 318. There is this distinction that the genuine British production of films is carried on under the threat that if the film is bad the firm will suffer? —Yes. 319. Now, as regards these other films which are produced under American inspiration, there is no such danger attached? — There is no incentive to make them. (Mr. Baker) : Even if they lose all the money put into the production it does not affect them very materially. (Mr. Loudon) : The American distributor will offer a contract to produce six pic- tures at a flat sum, £6,000 or £5,000 each, and the producer has to make them for that price, and if possible make a profit. He hands over the picture to the American distributor with no thought of making any additional money, and that is what creates the " quickie ". 320. And if that throws odium on the producer, it does not throw odium on the renter? — It is not issued with any trade mark that shows it is dis- tributed by the American renter for a purpose. It is trade marked by the British producer and goes out as if it were a British production, but the culprit is the American renter who acquires that type of picture to fulfil the letter of the law. (Mr. Kearney): He does not make it. He causes its production. G 2 52 COMMITTEE ON CINEMATOGRAPH FILMS 12 May, 1936.] Mr. F. W. Baker, Mr. M. N. Kearney, Mr. A. Koiida, Mr. N. Loudon and Captain the Hon. R. Norton. [Continued. 321. He causes the production of bad films, possibly deliberately, because he wishes it to be bad? — That is the other angle. He does not much care. 322. Or he is inspired by a bad motive, but no penalty or discredit attaches to him for the pro- duction of his bad films. That is put down to the discredit of British production? — (Mr. Loudon): That is right. 323. Assuming that as the result of what is con- templated in your proposals and the situation were changed. The American who inspires bad produc- tion would have to carry the odium? — (Mr. Kearney) : Yes and the public would know it. 324. And if by any chance that film went abroad again the discredit would attach not to British production ? — We hope so — we do not think so. Our hope is that adoption of our proposals will be suc- cessful in preventing bad British pictures from being produced at all. (Mr. Baker) : It would be quite easy for that label to be taken away from the film shown outside this country but in point of fact these American renters are not interested very much in sending these pictures abroad. (Capt. the Hon. B. Nortoii) : Even if they were, they would not get much showing abroad. 325. (Chairman) : Mr. Kearney has shown me a letter which raises that? — (Mr. Kearney): It con- firms a fact that has been brought to our attention time after time. I will not read the whole of it, but it says : — " I would state that the Chairman of one of our most influential clients on the Continent called my attention to the practice of one of the major American film producers when an all-British week was organised in honour of the visit of the Prince of Wales and there was a very widely advertised British film in one of their theatres. It transpired this film was a £4,000 quota film, and the public who went to see it left the theatre in disgust. This action for some time jeopardised the busi- ness of our clients who since 1928 have not only exhibited most of our films but those of other British producers. The Chairman, in order to regain the popularity British films had enjoyed prior to this incident had to introduce special propaganda in which it was explained to the public that the film in question was not a regular type of picture produced in Great Britain." They use the quota quickie to say, " Do not buy British pictures — here is a sample. Buy American pictures — here is a sample." To my knowledge something similar happened during the Imperial Conference in Ottawa during 1932 when, as you know, half the Cabinet were there. In some of the theatres in Canada, they showed English quota quickies and the public naturally did not want to see them. Such pictures did not enhance the reputa- tion of British producers. 326. (Dr. Mallon) : You would desire the attribu- tion of films to the renter who inspires the produc- tion, that should be the rule not only here but in the Dominions? — Well, we cannot enforce that, much as we should like it. 327. You would desire tiiat if it were possible? — We do not see the possibility. All we hope is that if by our own legislation we can eliminate the quota quickie it will not exist to perform that un- fortunate function overseas. 328. Something has been said as to the renters' quota apart from the exhibitors' quota. 1 do not want to touch unnecessarily on this issue again, but supposing that the renters' quota were abolished would not the situation be very much improved? Here you have certain renters interested, and only interested in American films The law, as it stands, puts upon him a task which he apparently does not relish. He has, under the law, to try to dispose of things in which lie is not interested. Is not that undesirable?— (J/;. Baker): I think it is a very in- teresting argument. I must confess that I do not think our thoughts have been leading that way because we have rather started with this premise that if we compel exhibitors to show British films we must compel somebody to make them. But the argument that has been advanced here, and the com- ment you have made is a very interesting one. But I think you have that very fundamental difficulty of compelling exhibitors to screen films, and not com- pelling anyone to make them. One can conceive that there might in trade conditions be difficulties, and it might become a hardship. Obviously producers would not object to any such proposals, I suppose we should all welcome such proposals, but perhaps we could say we would not dare, or we would hesi- tate to put such proposals forward, because we should feel that they would not receive considera- tion, or it might not be considered practicable. The big argument that you have, of course, is that you do not compel people to make films that they do not want to make, which is a very strong argument. The Americans do not want to make British films and have to make them, and therefore they make bad ones. 329. Supposing there was not the obligation that exists to-day on the renter to take a proportion of British films, what would he do? He would, one may suppose, market the American films and would refrain from attempting to exercise any malign in- fluence on British films?— Yes. 330. If that were the case what would happen? Would there not be an expansion of the more effective producers in this country at the expense of the smaller units who now produce the quickies? — I think undoubtedly there would be, but what you would have would be a tendency to make better pictures all round, because you would automatically do away with those pictures that are made because they have to be made, but you would meet, if I might say so, very strenuous opposition from the exhibitors. First of all, he would say, " You compel me to show pictures, but you do not compel any- body to make them." Secondly, he would be fear- ful that quota would constitute monopoly, 20 per cent., 30 per cent., 40 per cent., or whatever it was. The number of pictures might be automatically or otherwise decreased intentionally in such a way as to create a high value for those British pictures, which is prevented under these proposals, as they are prevented by the terms of the existing Act, by compelling renters to acquire a number of pictures in excess of the exhibitors' quota? — (Mr. Kearney): There is one further point. If we may be frank in the Film Producers' Group of the Federation of British Industries we necessarily have to try to take into consideration the interests and point of view not only of the major producers but of the less important producers also, who claim to have a right to live if they can; and they argue that if the American renters give them more money they would make better pictures. They also speak about what is known as the second feature. Lord Moyne was speaking before of programmes showing two long pictures. Obviously on all occasions when two feature pictures are shown one is the major and the other the minor attraction, and of the total receipts the greater part is paid for the principal picture and the lesser part for what is known as the second feature. If there is no production of second features, which cannot cost as much as first features, you could not supply those programmes. In most cases the British quota films inspired by American renters are never intended to be anything but second features made at low cost. That is the difficulty. If I hey cost a great deal more ihoy could not, as second features m the way they are rented, earn so much as bhey cost?— (Mr. Baker): If you wanted to develop that argument, it is an interesting one, but there are the difficulties. MINUTES OF EVIDENCE 53 12 May, 1936.] Mr. F. W. Baker, Mr. M. N. Kearney, Mr. A. Korda, Mr. N. Loudon and Captain the Hon. R. Norton. l< 'nil I | 331. I will put this, and leave it at that. Under your proposals, production of bad pictures would be limited in two ways. First of all there would be the minimum expenditure on the picture, that would be the first consideration. Secondly, the attribution of the picture to the renter who inspired it, and that would make in the same direction. It would still be true that the renter was marketing a picture in which he was not very much interested? — Quite right. 332. And people were producing pictures in- different ? — (With no heart in them. 333. Indifferent as to whether they were going to do good to British prestige, or not. I suggest if we can take off the renter the burden of doing some- thing in which he is not interested, or which he does nut want to do. that would be a gain? — (Mr. Loudon) : There is one point, the Act at the moment is responsible for a production of 111 pic- tures of this type in 1935, which is more than half the total British production last year in numbers. If you remove that legislation for renters' quota it would mean production in this country would drop by over 50 per cent, in numbers — not, of course, so large a percentage in production cost. 334. But the exhibitor would have to show the same number of British pictures? — (Mr. Baker): The argument is the demand would create the supply. (Mr. Loudon) : If you legislate for the demand you must legislate for the supply, or put a hardship on the exhibitor. 335. You could easily provide for that? — (Mr. Baker) : I am not quite sure whether I could say the Film Group of the Federation of British In- dustries would agree to that. I think that you would have opposition from those particular firms who are interested in theatres in addition to production. 336. (Chairman) : Anyhow it is agreed you could not do it immediately. There would be a shortage. 337. (Sir Arnold Wilson) : Before I begin my questions, may I remind the witnesses a shorthand writer is taking down what they say, and they will do well to remember, as I will try to remember, that there is only one and not two present. May I first address my questions to Mr. M. Neville Kearney, as Secretary. The memorandum purports to set out the views and proposals of the British film production industry as represented by the Film Producers' Group of the Federation of British Industries, of which you are Secretary. Is that group unanimous on this memorandum? — (Mr. Kearney): Not entirely unanimous. There are certain conflicting views; with the majority of the sections of it, yes. 338. If you were to take the total capital repre- sented by that Group, what proportion is definitely opposed to this memorandum? — It is difficult to say. (Mr. Baker) : I think it is a statement of fact. These proposals were adopted by the Federation of British Industries Group, and it is quite true that I think two companies voted against the increase of the quota proposals contained. That is the only point on which they took exception. (Mr. Kearney) : We do not deny they voted against the suggested increase in quotas. 339. Do they accept everything else? — They have not demurred from any other point at all (Mr. Baker): This is very important, and the question has been asked quite rightly, the definite objection that was expressed was simply and solely confined to the increase of the quota. There was no other known objection to the memorandum. 340. Is it a fact the two companies which objected are the two largest in the industry? — Producing companies? 341. The two largest companies in your group? — (Capt. the Hon. R. Norton) : I think we must answer that the companies most largely capitalised are not necessarily the largest producers. These big companies were arguing as distributors and ex- hibitors. (Mr. Loudon) : Their capital is very much greater than their interest in the production of pictures. (Mr. Baker) : Sir Arnold Wilson refers to two companies who have between them 500 to 600 theatres and they are, 1 believe, viewing lie e proposals, particularly the quota proposals, from the point of view of the exhibitor. 342. What proportion of the producing interest in the Group do they represent? — (Mr. Kearney): To-day? In numbers? (Mr. Loudon): I can give you the figures, Sir, 215 British pictures made for the year ending March last. Gaumont-British and their associated companies distributed 22 feature pictures and British International, or Associated British, had 13. Actually I am not counting the shorts. It was 14 over 3,000 feet. (Capt. the Hon. R. Norton): Of those 22 pictures distributed by Gaumont-British I happen to know only 17 were made by Gaumont-British and the other five were made by independent companies. (Mr. Loudon) : It does not represent such a large proportion of the production side of the industry. 343. One-fifth?— 215 pictures. 344. One-seventh? — (Mr. Kearney) : Although their capitalisation as companies within the industry is unquestionably the highest. 345. What proportion of theatres in this coun- try are tied houses, that is to say in the hands of companies owned and controlled by aliens? — Very small. But there is control other than that of actual ownership. There is control through supply of films. (Capt. the Hon. B. Norton): But actual ownership is limited to about 20. 346. Control, although they may be in the hands of British lessees? — That is very difficult to answer, because control through supply is an important factor. (Mr. Loudon) : Sir Arnold Wilson is dis- cussing the question of capital. (Mr. Kearney) : That is, I should say, very small. (Capt. the Hon. It. Norton) : Paramount have 14. The total of foreign-owned cinemas is under 20. 347. Can Mr. Kearney tell me what is the con- dition applied by the Federation of British In- dustries to qualify a company for membership? — (Mr. Kearney): I had hoped you would raise that because it was mentioned in the very early stages of this meeting. The qualification of membership of the Film Group, which is the point referred to here, is (1) that companies shall be British and shall have produced and trade shown at least one feature picture, (2) that they shall be elected to the Group by its members, and (3) that they shall be eligible for membership of the Federation of British Industries proper, according to its statutes. The rule, briefly, is that they shall be British-con- trolled companies and not foreign-controlled. That is how the Film Group is always able to keep out, if it wishes, a company who own studios in this country, and are a British registered company. But they are not members of the Group because the Federation of British Industries as such — its rules — would not permit of their being. Also the Film Group has preferred to have as its members genuine British companies and not companies which really are in another form foreign companies. 348. Does the Federation of British Industries make any elaborate inquiries with a view to ascer- taining whether a company which is normally regis- tered as British-owned is in fact a subsidiary of a holding company which may not be British owned and may be located elsewhere? — Yes. 349. Are yo)u satisfied that the Federation of British Industries are in a position at any moment to know if that control has been changed? — They consider they are. Whether they are in fact I could not say. Certainly so far as the Film Group is concerned we should know if a member company came under different control. 350. And in the event of any change of control the Federation of British Industries would at once notify the member that company was no longer eligible for membership ?— I should not like to answer definitely; it would bo firstly a question for 54 COMMITTEE ON CINEMATOGRAPH FILMS 12 May, 1936.] Mr. F. W. Baker, Mr. M. N. Kearney, Mr. A. Korda, Mr. N. Loudon an.! Captain the Hon. R, Nohton. [Continued. the Group. (Mr. Loudon) : I should think the mem- bers themselves would have something to say. 351. Film members are subject under the statute to the same rules as other members of the Federa- tion of British Industries. Are you satisfied that alien companies operating in this country charge a reasonable price for films to the — technically British- companies which they control? Do they charge, for example, the same rate as they do to American companies or, by charging a very high price, pro- vide that the profits shall be retained in the United States, for example, whilst the company here is barely able to make a profit? — That is a matter the revenue authorities do go into. 352. Do they go into it? — As we understand it they have an agreed arrangement with American renters by which they assess the correct amount that should bo returned from profits taxable in this country. 353. Have you any reason to think British com- panies suffer as compared with American com- panies in their assessment to income tax? — It is difficult to reply. I should say the American companies got off reasonably well, and your point gives rise to another thing exercising us a good deal at the present moment, and that is the American taxation upon the earnings of British films in America. They are seeking to apply American taxation to remittances from the earnings of British films in America before the remittances have left the United States. They are actually doing it now. 354. You are seeking to eliminate the provision that a scenario writer must be a British subject, and you mention you have numerous foreign artistes to whom you pay large sums. Do you consider those persons are advantageously placed compared with British subjects in their relation to the Inland Revenue Commissioners? That is effec- tively secured? — Yes. (Capt. the Hon. It. Norton): There is a custom that the Revenue will apply one- third of their salary to be counted for expenses, and that applies to foreigners as well as English. 355. Would that apply to a scenario .writer who might not be located here for more than a short lime? — Yes. 356. I am still in doubt as to the point raised by the Chairman : certain technically British com- panies which are in fact controlled organisations of American producing companies and allied with the renters' renting organisations in this country pro- duce films, but you say they are ineligible for mem- bership. But that is not strictly correct, it is? — (Mr. Kearney) : Yes; there are one or two pro- ducing companies, technically British, but in fact foreign-controlled and branches of foreign pro- ducers, who are not members of the Film Pro- ducers' Group. 357. There are bad films being made by companies who are eligible for membership? — We do not deny it. 358. Your memorandum might have been better worded in that respect? — With all respect, I think it is both carefully and accurately worded. (Mr. Holer): There will always be a proportion of bad films. (Mr. Kearney) : There are certain American companies here whose branches here are registered British companies. I mention the name of one. not with any lack of respect, or with any wish t<> criticise or pillory it in any way. Some of them have their own producing organisation. They are British registered companies established here for one purpose only and that is to rent American films and to acquire the quota films required to enalilo the American films belonging to their principals to lie rented. They are technically British companies, but, by capital control they are really entirely branches of the foreign companies. These could quite conceivahlj be considered eligible for member- ship, hut genuine British producers have not wanted them as members of the Grout) and we have a perfectly good method of getting out of it if they apply. In some cases they have applied. <''"//'. the Hon. It. Norton): If I might make a suggestion. We might give the Committee the num- ber of pictures those companies made last year. (Mr. Loudon): Fox had 13 pictures last year they made at their own studios; and Warners and First National together, 19. I woidd like to add some of the 19 were not actually produced by them in this country. Warners registered the two silent Indian pictures about which there has recently been trouble.- 359. Is there any other industry in this country which is so largely under alien control that you can think of? — (Mr. Baker): Manufacturing industry? 1 do not think so. 360. Is there any other distribution concern which is so largely under alien control at present? — (Mr. Loudon) : You might say typewriters, I think, possibly as the largest other industry. 361. In a discussion with Dr. Mallon you were giving examples of deliberate attempts to bring British films into disrepute in theatres abroad. Have you in your experience found that being done deliberately in this country also? — (Capt. the Hon. H. Norton) : Yes, Sir, I am prepared to say that. (Mr. Baker) : I think one method of doing it is by showing the films at what are termed the dead hours. 362. But also by exhibiting them in juxtaposition with the finest foreign films at a given moment in order to bring them into disrepute? — (Capt. the Hon. R. Norton): Some years ago when I was in the distributing business I was asked if I could pick a really bad British picture for the West End of London. That was when I was not a producer, and I was asked toy an American concern. 363. Is it within your knowledge that claques have been hired to bring a good British film into disrepute? — I would not like to say whether they have been hired for the purpose. {Mr. Kearney) : This rather brings up the point of publication of the evidence that may be given. (Capt. the Hon. It. Norton) : 1 have no objection to a statement of my personal experience being taken down. 364. (Sir Arnold Wilson) : (Will you give your personal experience? — I meant the one I have just described. (Mr. Kearney) : It is common practice when films are run in a theatre to have your not particularly good, if we do not call it bad, English picture running in conjunction with, either before or after, a really first-rate American film, and the public necessarily, whether it is intended that it should or not, naturally draws the conclusion that the American film is good and the British bad. Whether deliberately or not, it serves a dual purpose. It enables the foreign company to fulfil the law as it exists and it shows up the good quality of the American film as opposed to the bad quality of the British. Most of the British films so shown are second features. 365. If the two films were not in the same owner- ship it might be a cause of action in the Courts. There are I believe decided cases of -hop windows where the derisory exhibition of inferior ware of one kind with the superior ware of another has been regarded as actionable: (Mr. Loudon): I bhink the allocations of returns arising from two pictures where an American distributor handles a programme with an American picture and a British picture, his allocation of money to the British producer is such that the British picture suffers. lie oilers the British producer a contract on a basis of a lump sum down in advance of 50 to 60 per cent of its gross receipts. He then distributes that picture and says that it will be distributed to the best possible advantage, and there is never proof it is not distri- buted to the besl possible advantage lmt I do not think except in the case of United Artists, any American renter has ever distributed a British picture MINUTES OF EVIDENCE 55 12 May, 1936.] Mr. F. W. Baker, Mr. M. N. Kearney, Mr. A. Korda, Mr. N. Loudon and Captain the Hon. R. Norton. [Continued. to any large amount of money over what it costs, and therefore the British picture inevitably suffers. In that event the British producer if he makes a good picture never receives a proper return on it if it is distributed by an American distributor. (Mr. Kearney) : You may find a contract between a renter and exhibitor which calls for the payment of 45 to 50 per cent, of gross receipts during the three days or the week when the programme is shown. There may be two pictures covered by that contract, one English and one American. Of the total amount re- ceived for the two pictures the renter can attribute whatever proportion he likes to each film — he may apportion 95 per cent, of his receipts for the pro- gramme to the American picture and only 5 per cent, to the British. I am merely giving a guess figure, but instances have occurred (I think Mr. Loudon will bear me out in this) where in fact the English picture which was looked upon as of low earning value was the one that brought the people to the box office and not the major picture which was the American one — but nevertheless the American picture received the bulk of the proceeds and the English picture did not get its commensurate revenue. (Mr. Loudon) : I think we might mention that in the United States Film Year Book, 1935, in an article under the title " Film Outlook Abroad ", signed by Mr. Godden of United States Department of Commerce, writing about foreign legislation and discussing England, he says : — " During the past year there has been agita- tion on the part of exhibitors to do away with the quota, it being felt that the system is no longer necessary to protect the British film-pro- ducing companies. The contention is advanced that the quota is encouraging ' quickie ' produc- tions to meet requirements of the Act. Legisla- tion may result amending the Quota Act, making it mandatory that at least a minimum amount must be spent on each production to meet quota requirements. Such an amendment, if passed, will force quota film producers, because of a larger investment in the film, to distribute it rather than keep it on the shelf ". 366. It has been suggested that the prevalence of the two-feature programme is partly responsible for some of the difficulties of the British industry. Can you give us any indication as to the history of the two-feature programme. When did it come in, and in what circumstances? — (Mr. Baker): I should say the two-feature programme came into existence prin- cipally because the supply was so excessive in propor- tion to the demand that exhibitors, in their attempt to give the public as much as they could for their money, booked and screened two feature films instead of one, the one usually being supported by a number of shorts. Necessarily, of course, with the exhibitor desirous of booking two feature films, one of them became the primary attraction and the other the lesser attraction, and of course, in time, the lesser attraction picture became to be known as the second feature. I do not think there is any reason other than the supply of pictures, the normal number of pictures that have been available to exhibitors, have tempted them successfully to play two features in- stead of one plus shorts. 367. "Would, you regard it as fair to say that the effect of the two-feature programme is to compel exhibitors to exhibit a large number of inherently and intrinsically inferior films? — British or foreign? 368. Whatever; it may he? — I should say yes, because in the two-feature programme exhibitors do necessarily show a number of pictures, mainly American, of less value. 369. And you would agree that the second feature is normally 30 per cent, less than the first feature? — In time? 370. In time, yes?— -(Cop*; the Eon. 11. Norton) : No, often the same length. (Mr. Baler) : Very often the length of the two films differs very little. The length does not enter into it seriously at all. 371. Thank you? — (Mr. Kearney): Might I give an example of the type of thing that happens? The renter knows approximately what a theatre can afford to pay for its programme for the week. Let us assume a theatre can pay £100 for its programme per week. The programme includes a first and second feature, possibly also a news reel and a short. It depends on the length of the two features whether a short is included or not. Of the £100 he would roughly allocate what proportion should go to the first feature and the second feature. (Capt. the Hon. B. Norton) : I think the answer is the second feature does not connote length but connotes quality. 372. My impression was in point of length it was considerably shorter, but I am glad to be corrected? — There is one country that debars the two-feature programme, and that is New Zealand where they have only one. 373. For technical reasons it is difficult to advertise outside a cinema more than one film. Has that in itself, has the growth of advertising on a vast scale by means of illuminated advertising tended to put undue emphasis on the one picture to the detriment of the second? — (Mr. Baker): Usually the exhibitor, because he thinks of first and second features, does advertise what he thinks is his principal picture. 374. Tell me why New Zealand legislation was passed? — I do not think it is a question of legisla- tion. It is more a question of economics. New Zealand is a considerable way from Australia and it is a question of economics. I do not think we are suggesting that the British picture is affected by the second feature programme. I do not think we suggest that the condition or the position of the British picture is affected by the second feature problem, because in a large number of cases, in the majority of cases I suppose, the second feature is a foreign picture, and nearly all British pictures made by genuine British companies are automatically first features. (Mr. Kearney): With the exception of those made specifically for the quota purposes of foreign renters. (Mr. Baker) : I said of those made by British companies. I said all those made by British companies. Those made by American companies are second features to their own products. (Mr. Kearney): I may say we do always come against the point that although they are made by what we call American companies, such companies are in fact legally British companies. 375. Have alien controlled companies generally tried to work the Act of 1927 in good faith? — (Mr. Baker): Definitely not. (Mr. Kearney): They have in the letter but not in the spirit. 376. You were good enough to refer to " gentle- men's agreements " having been entered into, I gather, to evade the spirit of the law? — Yes. 377. Is there any other industry where the words " gentlemen's agreement " are applied to an agree- ment to evade the law? — We always refer to it in inverted commas ! 378. (Dr. Mallori): Inverted gentlemen ?— (Mr. Baler): We do have gentlemen's agreements in this country because it is the habit in all industries to trust one another, and we call them " gentlemen's agreements." (Mr. Kearney): In the original draft of our memorandum (which is slightly different from what it is in its present form) there was a somewhat scathing reference to the term " gentlemen's agree- ment ". 379. (Sir Arnold Wilson): I am glad to know it. It was suggested that if the proposals that you have put forward here for an increase of the quota were given legislative effect there would be a further increase of capital invested in the industry. 1 should like to know whether you consider the existing capital commitments, not actually invested, but capital com- mitments as at present invested, would suffice to give you the additional production which vou seek? 56 COMMITTEE ON CINEMATOGRAPH FILMS 12 May, 1936.] Mr. F. W. Baker, Mr. M. N. Kearney. [Continued. Mr. A. Korda, Mr. N. Loudon and Captain the Hon. R. Norton. — (Mr. Baker) : I think roughly speaking, Sir Arnold, that it would. I think not the proposals, hut the building that is going on at present and the space that has been built during the last 12 months, and the capital invested, will give the necessary extra pictures that are required to fill the quota. 380. You have in fact sufficient production capacity, or you will have shortly, to undertake the whole of the programme you would like to see? — There is no doubt in my mind whatsoever. (Mr. Kearney): May we put it in this way, the ratio of production capacity to the 20 per cent, quota will be vastly increased in respect of the ratio of pro- duction capacity with the new studios compared with what we propose should be the quota. (Copt, the Hon. It. Norton): I think it is important we have stated, " The value of the stages . . . £4^ million ", and of that these £2 million are just about to be completed and have not yet come into operation. (Mr. Kearney) : The new studios at Denham alone, which are just being completed, and would already have been in greater activity had there not un- fortunately been a fire in one of the stages — those studios alone provide an important increase in pro- duction capacity. I have the figures here if you wish to see them. 381. I do not think it is of sufficient importance. The Chairman drew attention in his examination-in- chief to the danger, if the quota was raised unduly, that there would be a reduced amount of competition for the suffrage of the public and that the exhibitors might be handicapped thereby. You retorted, I might say, that that had not been the case in the motor industry. But. in point of fact, in the case of the motor industry there has been a reduction in the last ten years of more than 50 per cent, of the total number of firms operating. There has been a steady reduction in motor manufacturing firms and com- petition exists only between, at the most, a dozen different firms where previously there were something like one hundred. Do you anticipate if the pro- duction of films in this country were to be increased there would be an increased concentration in the industry or not? — (Mr. Baker): I do not think the production of films will lend itself to that same degree of combination other industries do. It is more individualistic. 382. I attach great importance to this? — I am sure you realise and know the production of a film is not an automatic procedure. You can produce motor cars by mass production. You cannot pro- duce films in that same way. There must be a thought and brain behind each individual effort to make a picture. (Mr. London) : The film industry is more like the publishing industry, Sir; I think that is a fairer comparison. (Mr. Baker) : It does not lend itself to the same combination. 383. I cannot accept the publishing industry as a parallel, because you do your own printing? — We do not do our own printing. 384. Using the publishers as an example. You actually do everything? — (Mr. Kearney): Not necessarily. Many films are made, where the studio shoots the film but it has it developed outside its own premises and the print made outside its own premises. (Mr. Baker) : That might be a point that has not been stressed in the memorandum, but it has been suggested to me by Sir Arnold Wilson. Apart altogether from the studio activities of which we have heard a great deal to-day there is an im- portant section of the industry where the negatives, taken at the studio, are taken and the prints made, and that is a very, very big industry. There are very large laboratories in London and all round whose business is the developing of these negatives and making the necessary copies. It is the excep- tion rathei than the rule that the studio should develop its own negatives and make its own prints. A few of them develop their own negatives, hut they look upon the printing of the copies as somebody else's job, and in consequence there are very im- portant printing laboratories that undertake and do that work and employ a considerable number of people whose employees or the cost are never stated in this production. (Mr. Kearney) : They also print the positive prints taken from imported foreign negatives. 385. Therefore it makes no difference to that in- dustry whether the film is made in Great Britain or abroad? — (Mr. Baker): It does not make any difference. 386. Does that industry have any laige export of films printed in this country? — (Capt. the Hon. It. Norton): No, small, chiefly to Australia. 387. Are there serious technical difficulties dtie to the highly inflammable nature of the product which makes ships unwilling to receive as cargo? — (Mr. Loudon)- It is chiefly duties that affect them. (Mr. Baker) : The German lines refuse to take them. 3S8. When up against a difficulty you have repeatedly handed it cheerfully to the Board of Trade to deal with. Have you as practical men got any specific ideas in your minds whereby the Board of Trade could check some of these evasions with- out involving extra expenditure by the Excise officers of the Inland Revenue, or otherwise, or the police? — (Mr. Kearney): When drafting our memorandum we originally suggested, in respect of most of the paragraphs that you have in mind, that there should be reference of the matter to the Law Officers of the Crown ; and then we came to the con- clusion it might be rather an impertinence on our part to suggest to the Committee how they should do things; so we left out any such suggestion because the Board of Trade know full well what the problems are, and I think they probably can explain as well as any of us can the manner in which the law is evaded. 389. Has it occurred to you it might be preferable for you to exercise over all your own members in all three branches some measure of control which might be conferred upon you by Statute, as is for example conferred upon the fishmongers of the City of London who .with the proceeds of a very small levy on the trade actually perform all the duties which in other trades are performed by the appro- priate officers department of the Public Health De- partment?— It would be very delightful if we could bring it about, but unfortunately we have no Hayes organisation. (Capt. the Hon. B. Norton): The Motion Picture Producers and Distributors Associa- tion of America is an all powerful body within the industry, and it was formed, to a great extent, with the help of the Federal Government. If the BoaTd of Trade could help us to force exhibitors, renters and producers to get together into an association of some kind I think we «hould have made enormous steps. 390. My Lord Chairman, my point is really this: Parliament have already given to several trades certain privileges in return for which they have undertaken to keep a check on their own members. The Milk Marketing Board and the Pig Marketing Board do so. All Marketing Boards in greater or less measure do so? — (Mr. Loudon): There is our Censorship Board. 391. I would hesitate to draw a parallel. The fishmongers is another case, and the iron and steel industry have already got a very considerable degree of control over the internal operations of their own members by agreement amongst themselves although they are by no means united in interest. Is it impossible that some of these very disagreeable and dubious duties which you seek to place upon the Board of Trade could be carried out by an internal organisation with recourse to the Law Courts in case of a breach? — (Mr. Baker): I do not know whether we should lie in a better position or have any better information than the Board of Trade have. It is a very interesting proposal which had not occurred to me. MINUTES OF EVIDENCE 57 12 May, 1936.] Mr. F. W. Baker, Mr. M. N. Kearney, {Continued. Mr. A. Korda, Mr. N. Loudon and Captain the Hon. R. Norton. 392. Yon would at least have a common interest m securing information? — Yes. 393. And it would relieve the Board of Trade from the very invidious business of administering an Act in the interest of a particular section of it? — Quite 394. That is my point? — (Mr. Kearney): 1 think the answer is, would that it could be so. The various interests are so considerably divergent; and it is complicated by the fact that there are not only divergent British interests but divergent foreign interests as well. It makes it extremely difficult. 395. The next point I want to come to is the question of the special exhibition value. When the President of the Board of Trade introduced the present Act in the form of a Bill in 1927 into the House of Commons, he said that special exhibition value was synonymous with box office value. Do you consider that there is any possibility of giving another and a broader meaning to those words? — (Mr. Baker) : Well, I believe that in our delibera- tions, Sir Arnold, there has been an intention to give a broader meaning, and that perhaps is evidenced in paragraph 18. It does not directly refer to the special exhibition value, I agree, hut it is evidenced in that paragraph under " Short films." I think 1 know what you have in mind. That is the facility whereby certain films that may not be directly fictional but valuable for screening in this country should have the benefit of quota. I think that is what you have in mind, and I think that that class indicates the desire on behalf of the producers to encourage or help forward that class of picture. 396. I read that note with very great interest, and if I may take up the time of the Committee I will explain precisely what 1 have in mind. There are films produced by the Ministry of Labour show- ing the beneficial effects of industrial transfers. There are films produced by the Ministry of Fisheries showing in a dramatic form the vital interests of the nation in its own industries. The Post Office has made great strides, much to the public benefit, in the same way. I do not suggest that those films should be admitted to quota on the ordinary basis, but 1 do suggest that, apart from box office value, the cinema owners of this country have a moral obligation upon them to show a film of special exhibition value which is for the national benefit, although not of high box office value, but good stuff and worth looking at. (Mr. Kearney): That is precisely why wre suggest these films, documentary films, should be eligible to serve as renters' quota, because, if they are not eligible as quota, there has hitherto been a tendency on the part of the exhibitor not to use up his time in showing them, because he has to use a definite part of his time in showing quota pictures. The foreign renter will not take them because, unless they are eligible for renters' quota, they do not match his foreign films. 397. Would you accept a tribunal other than the Board of Trade Advisory Committee which is not in all respects suitable .for such a purpose, a Com- mittee of three independent persons who would view these films and would exercise their discretion in admitting them to quota operating under the Board of Trade? — (Mr. Baler) : I do not know that we as producers would raise any serious objection, but we really take the view, Sir Arnold — I know your views^ in this matter — that to some extent your point is covered in paragraph 18 (e). 398. I agree, but you must not know my views. 1 am here as a judicial person and whatever views I may express to the Advisory Committee are not relevant to what I am asking here? — No, I quite understand. 399. One more point. I saw outside in the street as I came in a poster, " Nasty Mae West film.'' Now that unquestionably is special exhibition value? — (Mr. Kearney): Probably more so on account of the posters. 400. More so for the posters. You have to put that sort of thing on the one hand and on the other dramatic documentary film, which has a far more lasting effect upon the minds of people, but it is quite impossible to say that you will get people to the theatre for the purpose of seeing a Post Office film although it will give pleasure and instruction and a lasting pleasure to large num- bers?— That is so. (Mr. Baker): I do not think the public object to seeing that class of picture. I think that if it is on the screen a large pro- portion of them like it, and if this proposal in paragraph 18 (e) will permit of that class of picture being accepted for quota, and that is the desire of the producers, I think it will be to the good, it will bring in a lot of that class of subject. 401. I revert once more to the question of capital investment needed in order to produce more British films. You thought that it would not have the effect of causing greater concentration of industry. Can you suggest what is a reasonable capital sum required to start and maintain a successful studio? Is it £100,000 or a quarter of a million or is it £1 million? — (Mr. Kearney): To erect your studio and equip it you require a certain amount of capi- tal. The making of your picture requires a different type of capital altogether. 402. Here? — And everywhere. (Mr. Loudon): The producer — if I may answer that question — if he is clever can make his picture economically. He can use any of the studios that are in existence as fac- tories in order to make that picture, he need not necessarily own studios, he can rent one and make a picture. All he requires is a certain amount of money to make his picture. (Mr. Kearney) : He may get advances from the renter who is going to rent it. There are many ways of financing the making of a picture. 403. I have heard complaints from people working in the industry that your trade is one of the worst organised in England in that you are always in a hurry, you are always expecting dressmakers, cos- tumiers and carpenters to work three shifts, two shifts on Saturdays and Sundays, that you never have a programme in advance, that in general you are artistic in your methods rather than commer- cial?— That is very high praise to say we are artistic in our methods. (Mr. Baker) : I think there is a good deal of justification and truth in that. (Mr. Loudon): They may be generalising a little. 404. My friends are admittedly generalising, but they are nearly all men and women working, and they say it is due to the fact that if they had a sound commercial manager who insisted on keeping them all in order it would save a great deal of money and you would incidentally do far less damage to the interests of your employees. Is that being lessened by the modern studio? — (Mr. Baker): I think that we are experiencing in this country, as we would in any other industry, that with growth there is better control and more improved commer- cial methods are being adopted. That is inevitable, I believe, and I am quite certain within my memory there has been a considerable improvement. (Capt. the Ron. B. Norton): I think I should like to say that in America they are obviously better organised as producers than we are here, but that is because artistic people have been made commercial. You will never make a commercial person artistic, you will never make a good producer by having an ;irtistic group of people round him because you will not get any box office residt. 105. (Sir Aim, hi Wilson) : Thank you, my Lord Chairman, those are all the important points I wish to put, and I apologise to the Committee for keeping them so long. 406. (Chairman) : Gentlemen, we are very much obliged to you for the evidence you have given us. — (Mr. Baker) : 1 think 1 might say, my Lord Chair- man, before we go, that if you deem it necessary to call any of us as a body or otherwise we shall be pleased to be at your service to clear up any ques- tions or give additional evidence. 407. (Chairman): Thank you very much. i The \\'il in sses withdrew.) 36452 II 58 COMMITTEE ON CINEMATOGRAPH FILMS 12 May, 1936.] i Con ' < n -/''(. AXXEX I. Sugg ested Quotas. — Based on a Percentage of Foreign Film Handled. Renters' Quota. Proposed new Quota (being the percentage of Approximate equivalent British film to be acquired, on basis of calculation of calculated upon the total the present Quota Act. of foreign film acquired). Per cent. Per cent. 1st year of new Act 29 22-5 2nd „ „ 33 25 3rd ,. „ 38 27-5 4th ., ,. 43 30 5th „ „ 48 32-5 6th and subsequent years 54 35 Exhibitors' Quota. (To commence 6 months after the date laid down for commencement of Renters' Quota.) Proposed new Quota (being the percentage of Approximate equivalent British films required to on basis of calculation of be exhibited, calculated the present Quota Act. upon the total of foreign films exhibited). Per cent. Per cent. 1st year of new Act 25 20 2nd „ „ 29 22-5 3rd ., „ 33 25 4th .. „ 38 27-5 5th ., „ 43 30 6th and subsequent years 50 33-3 (Note. — By the present Quota Act Exhibitors are required to show approximately 1 British film out of every 5 films exhibited. By the new quota proposed above, the maximum requirement would be that 1 British film must be shown out of every 3 films exhibited.) ANNEX II. F.B.I. Film Producers' Group. * Associated British Picture Corporation, Ltd. ♦Associated Talking Pictures, Ltd. Baxter and Barter Productions, Ltd. ♦British and Dominions Film Corporation, Ltd. ♦British Lion Film Corporation, Ltd. Butcher's Film Service, Ltd. City Film Corporation, Ltd. Criterion Film Productions, Ltd. Embassy Pictures (Associated), Ltd. G.S. Enterprises, Ltd. *Gainsborough Pictures, Ltd. *Gaumont-British Pictures Corporation, Ltd. *Gaumont-British Instructional, Ltd. *J. H. Productions, Ltd. *London Film Productions, Ltd. *Nettlefold Studios. Phoenix Films. St. George's Pictures, Ltd. *Sound City (Films), Ltd. John Stafford Productions, Ltd. Toeplitz Productions, Ltd. ♦Twickenham Film Studios, Ltd. J. G. and R. B. Wainwright, Ltd. * Companies thus marked are Studio owners. ANNEXES 59 12 May, 1936.] [i 'o-ntin %ed. ANNEX III. Approximate Statistics of Biutish Film Production during the Years 1928 and 1935-36, respectively. 1928. 1935-36. Number of Stages and Size No. of Stages. Total Area. sq. ft. 19 105,211 No. of Stages. Total . 1 n a. sq. ft. 70 795,557 Value of Studios and Equipment (less deprecia- tion) ... ... ... £555,000 £1,414,500 Annual Salaries and Wages (exclusive of artistes salaries)... £197,250 £2,197,000 Number of feature films produced and their production cost Number. Cost. 91 £489,600 Number. Cost. 225 £5,344,500 Note. — The above totals have been compiled from a mass of statistics furnished by the various Production Companies. They do not include particulars of all the smaller studios, and in certain cases estimates have had to be made where the controlling companies have failed to supply details. Stage areas and values of new studios nearing completion are included. The figures are sufficiently accurate for the purpose of general comparison between the importance of the British Film Production Industry in 1928 and at the present time. No reference is made to Production Companies that have gone out of existence between 1928 and 1935-36. The figures relating to the latter period indicate the importance of production as it exists to-day. The approximate number and production cost of feature pictures made in 1935-36 naturally does not take into account the future production of new studios. It is obvious, however, that when in the near future these are in full production, the number of feature pictures to be made annually will greatly exceed the present output. It is noteworthy that the new studios at Denham, Sound City, Pine wood and Elstree, completed during the last few months, or nearing completion, more than double the capacity of the studios that previously existed in addition to being of a most up-to-date type. No account is taken of the important sums paid annually to Film artistes, the majority of whom are, of course, British subjects. THIRD DAY. Tuesday, 19th May, 1936 (Morning Session). PRESENT : The Rt. Hon. Lord MOYNE, D.S.O. {Chairman). Mr. A. C. CAMERON, M.C., M.A. Mr. J. S. HOLMES. M.P. The Hon. ELEANOR M. PLUMER. Lt.-Col. Sir ARNOLD WILSON, K.C.I.E., C.S.I. C.M.G., D.S.O. , M.P. Mr. W. H. L. PATTERSON {Secretary). Mr. Paul Rotiia, representing the Associated Realist Film Producers, Ltd., called and examined. The Committee had before them the following memorandum of the Associated Realist Film Pro- ducers, Ltd. : — The purpose of this memorandum is to place before the Departmental Committee appointed by the President of the Board of Trade the view of Associated Realist Film Producers (see Annex 1) on the Cinematograph Films Act, 1927, with particular reference to the production and distribution of Documentary Films. Summary or Points. 1'art A. — The Effect which the Quota Regulations of the Cinematograph Films Act, 1927, have had on the Production, Distribution and Exhibition of Documentary Films. Part B. — Ways in which the Administration of the Cinematograph Films Act, 1927, in Relation to Documentary Films, might be Improved within the Terms of the Act. l'art C. — Ways in which the Position of Docu- mentary Films might be Legitimately Improved under any new Cinematograph Films Act which may be passed upon the Expiring of the Cinematograph Films Act, 1927. Annex I. — Constitution of Associated Realist film Producers Ltd. Annex II. — Definition of a Documentary Film. Annex III. — Excerpts from Newspapers relating to Documentary B^ilms. Annex IV. — Data relating to Documentary Films referred to in the Memorandum. Summary of Points. Part .1. — Discouragement of the Present Yet '<< Documentary Film Production and Exhibition. 1. Difficulties of interpreting the term "special exhibition value". 2. Lack of representation of Doeimien Film interests on the Advisory Committee of the Hoard of Trade. :i. Shortage of " short " films for quota requirement - . 3G452 B 2 60 COMMITTEE ON CINEMATOGRAPH FILMS 19 May, 1936.] Mr. Paul Rotha. [( 071 ( inued. Pari /'. — Suggested Improvements to the Present Act. 1. Difference of appeal between Documentary Films and Fiction Films. 2. Suggested appointment of a Sub-Committee to the present Advisory Committee of the Board of Trade to consider Documentary Films. 3. Need for a wider interpretation of the term " special exhibition value ". Fart C. — Documentary Films and any new Cine- matograph Films Act. 1. The need for the balancing of all foreign short films only by British short quota films and not by an excess footage of long films. 2. Suggested requirements to be made by the Board of Trade by which the makers of Docu- mentary Films would establish the claim of their films for quota. 3. The need for the encouragement of the pro- duction and exhibition of Documentary Films by any new Cinematograph Films Act Part A. The Effect of the Cinematograph Films Act, 1927. on the Production, Distribution, and Exhibit am of Documentary Films. 1. The Act was framed before the Documentary Film (Annex II) became an important feature in British production as a medium of entertainment and public education. It is granted that the Board of Trade has administered the Act with as much fairness as its terms have permitted. 2. The Act at present excludes from quota : — (a) Films depicting wholly or mainly news and current events. (b) Films depicting wholly or mainly natural scenery. (c) Films depicting wholly or mainly indus- trial or manufacturing processes. (d) Scientific films, including natural history films. Renters' quota (or fall quota) is, however, allowed to such films which, if registered, are deemed to have " special exhibition value ". 3.. Many Documentary Films deal with news and current events, natural scenery, industry and scien- tific experiment. They are thus excluded from full quota unless of proven " special exhibition value ". The difficulties of securing such evidence may be set out as follows : — (a) APress.show — one proof of "special exhibi- tion value "—is difficult to arrange if a film has not been taken by a renter. (Some producers have used a Film Society performance as a solution to this difficulty. But, on the one hand, a Film Society can include only a few Documentary Films in one season and, on the other hand, renters interested in the said films are some- times opposed to a Film Society showing.) Evi- dence of " special exhibition value ", therefore, has sometimes to be obtained by the unorthodox method of soliciting advance testimonials from newspaper critics. (b) A renter may, however, insist on full quota before taking the film. As pointed out above, a press show to establish " special exhibi- tion value " is difficult to arrange until a film is taken by a renter. Thus a vicious circle is often formed. (c) It is understood that the normal practice of the Board of Trade is to seek the advice of an Advisory Committee. The members of the Film Trade of this Committee, however, are representative only of the production, renting and exhibition of fiction films. Neither film technicians, nor those who have made a special study of producing or renting Documentarj Films are represented. 4. It is stated that the production of British short films which have been registered under the Act has fallen from 170,000 feet to 68,000 feet be- tween 1929 and 193-5, and that there is a definite shortage of " short " films for quota requirements.* their places being taken by long films. This shortage would not have been so great if Documentary Films had been eligible for full quota without the cumber- some machinery and insurmountable obstacles encountered under the term " special exhibition value ". 5. The situation has been further aggravated by the granting of ftdl quota tc casual descriptive films. and the refusal of full quota to such creatively-made Documentary Films as The Key of .S'< otland and Beside flu Seaside. (*. If it is the intention of the Cinematograph Films Act, 1027, to encourage the best in British Films, we submit that this discouragement of Docu- mentary Film production has been instrumental in holding back the development of films of National. Empire and Cultural value. The output of Docu- mentary Films projecting themes of British and Empire importance might have been greatly en- larged if there had been the incentive of quota. In our opinion, an ill service is being done to what is, in many qualified opinions (Annex III), the most creatively7 and nationally conscious section of British Film production. Part B. Ways in which tin Administration of the Cinemato- graph Films Act, 1927, might be improved within the terms of the Act. 1. It is submitted that in respect of the difficul- ties set out in Part A above the National, Empire and Cultural value of Documentary Films should be considered as relevant to the case for special treat- mint under the present Act. 2. Such special treatment, it is clear, can only be asked for under the existing clause allowing for " special exhibition value " (Cinematograph Films Act, 1927, .Part IV, s. 27 (1) (i) ). and subject to the provisos laid down by the Act. 3. In so far as the Board of Trade officials do not assess the exhibition value of films, a decision pre- sumably rests upon the advice of the Advisory Com- mittee, the constitution of which (as pointed out in Part A, 3 (c) above) does not represent the special interests of Documentary Films. 4. The producers of such films believe, firstly, that the appeal of their films depends on factors quite distinct from those which constitute the "special exhibition value" of fiction films; and. secondly, that these special considerations (techni- cal, cultural and educational) are not sufficiently taken into account by the Advisory Committee. 5. It is suggested, therefore, that the grant of lull quota to such films under this clause should be made by a special Sub-Committee of the present Advisory Committee, representative of such interests as the British Film Institute, a commercial firm specialising in Documentary Film production, and others who have made a special study of the Docu- mentary Field (Annex 1). Such a Sub-Committee could (a) bring to the Council of the Advisory Com- mittee those special considerations which are in- separable from the assessment of the "special exhibition value " of Documentary Films, and (6) act more quickly than is at present possible. 6. With reference to the interpretation of the term " special exhibition value " it is asked that these further considerations be taken into account. subject to the films coining under the provisos con- tained in the Act (Part IV. s. 27 (1) (i) )• * Ret. : " A Statistical Survey of the Cinema Industry in Groat Britain. 1!»:U", by S. Kowson. Leading artii le in " Sight and Sound " (Spring. 19:!t5). MINUTES OF EVIDENCE 61 19 May, 1936.] .Mr. Paul Rotha. [( '■■it tinned. (a) Documentary Films are capable of wide development. The advent of sound, for example, has greatly added to the entertain- ment appeal of Documentary Films, making them popular with the public, while the wide- spread need felt for the interpretation of National and Empire life has made their pro- duction of national significance. (h) It is appreciated that the framers of the Act wished to exclude from obtaining full quota the casual discursive descriptions of natural life, such as news reels, descriptive films of industrial process, travelogues, etc. (though judging by recent quota decisions, this aim does not seem to have been fully achieved). Docu- mentary Films, however, are a creative and not a descriptive interpretation of natural life, necessitating dramatic construction and high technical ability. (r) It should be noted that the term " special exhibition value " sometimes means appeal to specialised audiences. The Song of Ceylon for example, a film of great but specialised appeal, secured the Prix de Gouvernement Beige at the International Film Exhibition at Brussels, 1935, thus bringing international prestige to British film production. (d) As will be observed from the attached excerpts from the Press and other sources, Documentary Films are now regarded as an im- portant branch of British film production. (Annex III.) (e) The Cinematograph Films Act, 1927, ex- cludes films from qualifying for quota on the grounds of subject matter. (Viz. : " The films to which this Act applies are all cinematograph films other than — (i) films depicting wholly or mainly news and current events : (ii) films depicting wholly or mainly natural scenery : (iii) films depicting wholly or mainly in- dustrial or manufacturing processes: (iv) scientific films, including natural history films.") This, we submit, provides no test of the en- tertainment or cultural importance of a docu- mentary film. The differentiating factor, it is emphasised, lies not in the subject matter (i.e. " current events," or " natural scenery ") but in the creative treatment of tltis material. (/) The Board of Trade should not, it is felt, disregard the special entertainment values peculiar to the documentary film. 7. An examination of the material excluded by the Clauses of Section No. 27 of the present Act, with reference to Documentary Films which have already been produced, makes apparent the in- adequacies of Section No. 27. Only clauses (a), (&), (e) and (/) are considered here since these affect Documentary Films most directly. Clause (a). — " Films depicting wholly or mainly news and current events." It is possible to make an ambitious, creative and culturally important treatment of news and current events, cf. sequences of B.B.C. The Voice of Britain and Night Mail; potential documentary films of the March of Time type; Shipyard and The Face of Britain; and in another medium, the actuality programmes de- veloped by the B.B.C. current events, if shaped to a theme, may give drama of the utmost im- portance. It is to be noted that the Documentary Film is more and more using the camera and the microphone for direct observations, e.g., the new films of the Ministry of Labour. There will be more current events, not less, in the Documentary Films of the future. Clause (b). — " Films depicting wholly or mainly natural scenery." Should a film which, in using exclusively natural scenery, makes a poem of a particular landscape, say, the Lake District, or the Highlands, be excluded under this ClauseP Clause ((')• — " Films depicting wholly or mainly industrial or manufacturing processes." The dramatisation of manufacturing processes has, in fact, been a principal force in the development of the Documentary Film. It has been possible for a great number of people to conceive of industry as dramatic and as containing within it themes of Empire and national importance, cf. Shipyard, Industrial Britain, Face of Britain, Contact, Coal- Face, Voice of Britain and others. Themes in- volving commercial organisation, scientific manage- ment and marketing research in relation to com- merce and agricultural organisation, are capable of similar film approach. Clause (/). — "Scientific films, including natural history films." On the face of it this category may seem to be fairly excluded. On the other hand, The Life of a Plant, one of the original Secrets of Nature films, is held by many to be historically one of the most important cultural films. In this film the treatment of the life cycle of a plant passed from being a purely scientific consideration into something of aesthetic and en- tertainment value. Note also the possibilities of the dramatic treatment of a scientific contribution to commerce (cf. Shadow on the Mountain) and of a dramatic account of animal life at the Zoo, or a treatment of animal or even plant life which would reveal the drama of existence (cf. The Private Life of the Gannets and Wake up and Feed). Part C. Ways in which the Position of Documentary Films might be legitimately improved under any new Cinematograph Films Act which may be passed upon the Expiring of the Cinematograph Films Act, 1927. 1. In the framing of any new Cinematograph Films Act, it is felt that not only should the considera- tions set out in Part B above be taken into account, but that the opportunity should be taken to free the Documentary Film from its present legal burdens. In this respect, it is asked that the following points should be borne in mind : — (a) The Documentary Film is a means by which the ideals, culture and traditions of this country can be admirably projected both to British audiences and to foreign. (b) The Documentary Film is already a source of prestige to British Cinema in the inter- national field, and with proper and reasonable encouragement this would increase. (c) Any vital form of civic education, such as is afforded by Documentary Films should not be overlooked by centres of government. (d) Documentary Films are one of the finest means of training film technicians. Any en- couragement of Documentary Film production must influence the technical quality of all types of films. (e) The Documentary Film is considered by many persons entering the business as the most interesting branch of film production. Thus the personnel employed in Documentary Films is increasing in number and includes producers, directors, musicians, painters, photographers, sound recordists, assistants, as well as electricians, cutting-girls, theatre projectionists, etc. 2. It is believed that the production and distribu- tion of Documentary Films would be encouraged by changing the existing Act as follows: — (a) Full quota should be granted to all Docu- mentary Films, both short and long, which possess National, Empire and Cultural values. (b) In the Cinematograph Films Act, 1927, the footage of British quota films required to bal the footage of foreign short films (thai is, films 62 COMMITTEE ON CINEMATOGRAPH FILMS 1!) May, 1936.] Mr. Paul Rotha. | < 'ov ft n "< d. less than 3,000 feet in length) can be comprised of British long films (that is, films of 3,000 feet and upwards in length). We believe that in any new Cinematograph Films Act, or if the present Act is extended, it should be required of renters and exhibitors to balance all foreign short films only by British short films for which full quota has been given, (c) A Sub-Committee, carefully selected as representative of Documentary Film interests as suggested in Part B (5) above, should be appointed to deal specially with the field of Documentary Films. ( Scotland. Production : Stran Direction : Marion 1934. Beside the Seaside. Production : Strand Film Company Direction : Marion Grierson. 1935. Song of Ceylon. Production : Cinema Contact Ltd. Direction : Basil Wright. Distribution: Denning Films. 1935. B.B.C. the Voire of Britain. Production: G.P.O. Film Unit for Broadcasting Corporation. Direction : Stuart Legg. Distribution: A.B.F.D. 1935. Night Mail. Production : G.P.O. Filn Direction : Harry Watt. Distribution: A.B.F.D. 1936. M arclt of Time. (Series.) Distribution : Radio Pictures. 1935 and 1936. Shipyard. Production : Gaumont-British Direction : Paul Rotha. Distribution : Gaumont-British L935. The Fmi' of Uri In i a. Production : GauTnont-Brit ish Direction : Paul Rotha. Distribution : Gaumont-British L935 the British Unit. ANNEX IV. Films mentioned in the Memorandum. Industrial Britain. Production : The Empire Marketing Board. Direction : Robert Flaherty. Distribution : Gaumont-British Distributors. 1933. Contact. Production : British Instructional. Direction : Paul Rotha. Distribution : Wardour Films. 1933. Coal-Face. Production : Empo. Direction : Cavalcanti and Grierson. Distribution : A.B.F.D. 1935. The Life of a I'lant. Production: British Instructional Films. Direction: Percy Smith. Distribution: Wardour Films. 1938. Shadow on tin' Mountain. Production : Empire Marketing Hoard. Direction : Arthur Hit on . Distribution : Gaumont-British Distributors. L931. Wake up and /•'• i d. Production: Gaumont-British Instructional Ltd. Direction : J. B. ! [olmes. Distribution : Gaumont-British Distributors. lit.-!.",. Private TA.fi of th< Gan nets. Production : London Films. Direction: Dr. Julian Huxley. Distribution : United Artists. 1935. Instructional Ltd. h Distributors. [Instructional Ltd. Dis1 ributoi s. MINUTES OF EVIDENCE 71 THIRD DAY Tuesday, 19th May, 1936 (Afternoon Session) Present : The Right Hon. Lord MOYNE, D.S.O. (Chairman). Mr. A. C. CAMERON, M.C.. M.A. | The Hon. ELEANOR M. PLUMER. Mr. W. H. L. PATTERSON (Secretary). Mr. S. H. Cole, Mr. D. Dickinson and Mr. G. H. Elvin (Secretary), representing The Association of Cine-Technicians called and examined. The Committee had before them the following memorandum of The Association of Cine-Technicians : — Growth of British Film Industry. The Association of Cine-Technicians is frankly appalled at the suggestions that have been made in certain quarters that renters' quota should be abolished or considerably reduced upon the approach- ing expiry of the Cinematograph Films Act, 1927. The Association is of the opinion that the growth and present size of the British film industry, with the consequent employment to thousands of British persons, is almost entirely due to the " Quota Act." There was a period in 1925 when only one major picture — " Satan's Sister^" directed by George Pearson and starring Betty Balfour — was being made. While this production was on location in Jamaica, there was no other major film in production in the entire British Empire. For the year ended 31st March, 1934, over two hundred British films were registered under the C.F.A., and actual British production was in excess of this amount, as, under the Act, certain types of film are not eligible for quota. It is felt unnecessary to enlarge upon the growth of the British film industry during the past ten years, as the information will be ascertained through replies to the questionnaire sent by the Board of Trade to British studios. It should be emphasised, however, that had there been an Association of Cine- Technicians at one time in early 1927 its maximum possible subscribing membership on the studio side could not have exceeded twelve. At present member- ship is approaching 1,000, which figure does not in- clude every technician in the industry. " The Quota Act " has largely enabled the British film industry to develop, not only as regards actual number of productions but also as regards the quality and size of such productions. Without the " Quota Act " it is felt that it would have been almost impos- sible to build up an industry which could have pro- duced films such as " Henry VIII," " Home Express," "The Man Who Knew Too Much," " Shape of Tilings to Gome," " Thirty-nine Steps," "Escape Me Never," "Nell Gwyn," "Queen of Hearts," and " Blaclomail." Criticisms of the 1927 Act. 1. Bad Quality Quota Pictures. Bad quality pictures havt been produced in order to fulfil renters1 quota, and it is felt that most of these pictrues were bad, simply because no effort had hern made to make them otherwise. This is particularly so in the case of foreign rent- ing companies, by whom the " Quota Act " was regarded more as an import tax on their foreign product than an aid in the building up of a British industry. Some companies are alleged to have pur- posely made bad pictures in order to show up the superiority of foreign productions. For example, one foreign company makes pictures in this country which are scheduled to be made in eleven days. There is a well-known instance of a British technician who criticised the set constructed for his film, and the retort received was to the effect thai "What does it matter, anyway , the film will never be shown.'' Several films made have had bad press and public receptions. If the intention to make good pictures was serious, then the same company would not con- tinue to employ the same directors for subsequent pictures, as they have been known to do. 2. Retarding Progress of British Technicians. The moling of " Quickies " and inferior pictures merely for quota purposes is reflecting detrimentally on the British technician. The " Quota Act." as we suggest above, has resulted in the production of bad quality British pictures. Under the Act, British technicians must be employed in making such pictures. This has led to a bad general opinion of the competence of British technicians, and to foreign technicians (of whom there are over one hundred employed in the British film industry) being imported to work on the more ambitious British productions. The British technician has a pride in his work, and wishes to be employed on and help to make good pictures. We feel sure that this was the intention of the original Act, and trust that it will be possible to find ways and means to make this possible. Adrian Brunei, one of Britain's best-known direc- tors, deals fully with the danger of " quickies " to British technicians in the May, 1936, issue of " The Journal of the Association of Cine-Technicians ", and a copy of this article is attached as an appendix to this statement.* 3. Non-compliance with the Spirit of the Act. While in many cases the letter of the law is com- plied with, its intention is broken. For example we quote the following article which appeared in " The Era " of Wednesday, 10th July, 1935: — " Charwomen and Quota Films. Drama and Dust. By G. A. Atkinson. " Cinema charwomen are the real — almost the only — public experts on quota films. They may be the only people in the theatre when quota films are given public exhibition by certain alien companies for the purposes of ' technical com- pliance ' — as the process is described — with the British Act of Parliament governing the conduct of aliens in regard to quota films. " Alien companies controlling West End cinemas have to ' show ' quota films as exhibi- tors, as well as to ' acquire ' them as distribu- tors. They run them over their screens in the morning dust of the theatre, before handing them over to the 'distribution ' side to inherit more dust on cellar shelves. * * * " One young British director of my acquainl ance, having made an ingenious little film of which he was passablj proud, sam thai it would be showing at the theatre ' at ten o'clock '. * Not re-printed, 72 COMMITTEE ON CINEMATOGRAPH FILMS 19 May, 1936. | 'Mr. S. H. Cole, Mr. D. Dickinson and Mr. G. H. Elvin. [Contui m ./. " Thinking it would be in the evening show at that hour, he sat through the entire pro- gramme, and having failed to notice his pro- duction in tin' procession, asked the manager where it was. " ' Oh, that ', said the manager, ' we show that at ten in the morning ! ' " .My friend is now wondering if any but charwomen will ever see his film. " This particular film received quite good notices in the trade Press, whereby hangs a tale, because alien companies are not in the habit of showing their quota films to Fleet Street critics. # * * " One famous lay Press critic, whose name I do not mention, because film critics, in these days, have to tread delicately, said to me: 'It is unfortunate that we are not allowed to see these quota films at their trade show, because we miss the work of the young directors who show promise, and the players who might be worth encouraging. If we want to see them we have to make very exact inquiries as to where they can be seen, and then attend theatres under difficult conditions and at extraordinary hours. Quota film production is clearly a great school of rising talent, but the lay Press has been successfully ringed-of from it.' " It would be interesting to know how many quota film producers have received more than one advance from alien companies on account of the cost of production. " If the film does not reach the theatres, then obviously the contract which entitles the producer to a percentage of the receipts — after the dis- tributor has deducted expenses and cost of prints ! — becomes void. " One quota film producer showed me a list of a dozen films on which up to that time the first advance had been the last. He was not entitled to further payment until the percentage of gross bookings due to him exceeded the advance, plus distributor's expenses and cost of prints. " Instances can be given of films costing as much as £30,000 not having received London presentation at all, and of their exhibition in America having been delayed by two years. * * * " Out in Hollywood there is a former director of British films who has had to organise a pub- licity service to explain why the films which followed him from this country to America are so much out of date. " One alien distributor who contracts for the production of quota films on a considerable scale has never <>ven been inside the studio in which the films are made for him. " The duty of our Government in this matter is as plain as a searchlight. ' They should introduce into the Act clauses which will compel the alien companies to observe the law in the spirit as well as in the letter. " They should extend the Act for another ten years and enforce a minimum expenditure of £15,000 per film, under conditions that will ensure quality and guarantee exhibition. " Thus only can the important industry which the Act was designed to call into existence be protected ". 4. Salaries and Working Conditions. The present Act tends towards low salaries and had working conditions lor those employed by the smaller companies in the production of "Quickies." Renters engaged on such films generally cause technicians to work excessive hours — 1.") hours a day or even longer is not unusual; a seven-day week is a common prac- tice; meal rests are often conspicuous by their absence or remembered for their brevity; and illogical restriction of expenditure is frequent. To meet the above criticism, and generally to strengthen, in the, new Act. the original intention ol the C.F.A., 1927, the Association of Cine-Technicians makes the following suggestions: — Suggested Clauses for inclusion in the Amended Act. (i) expenditure. (a) < 'ost of Film. There should be a minimum expenditure clause. The Association of Cine-Technicians suggests tint no picture of 6,000 feet or over should be eligible for quota unless it has cost at least £12,000. Film.-; of less than 6,000 feet in length should cost a minimum of £2 per foot. We exclude from this suggestion the classes of short film which we suggest should be eligible for quota in Section IV of this statement. As there are many ways by which the cost of pictures can be adjusted — for example, by subsidiary companies and interlocking of directorates — it i- essential that there be stipulations as to the maximum expenditure on certain major costs of pro- duction, such as salaries, particularly artists and highly paid persons who may have an interest in the company, overheads and company directors' re- muneration, to ensure that the £12.000 is really spent on production. It is suggested that it be stipulated that not more than 30 per cent, of the cost of a film should be spent on company directors' fees, preliminary ex- penses, overheads, film directors' fees, and story and scenario. The production manager of one of the biggest British studios, who is a member of the association, has drawn up, based upon his experiences, an esti- mated schedule of expenditure on a picture costing about £12.000. The costs are based upon five week-' studio work. It is appreciated that expenses under any one head will vary somewhat according to the type of pro- duction, and minimum and maximum expenditures of all items are therefore given. It will be noted that the figures are £4.000 under, and £4.000 over, respectively, the suggested minimum cost of £12,000, .which gives ample elasticity on cost according to the type of production. Minimum. Maximum. Studio rent and equipment Electricians and electricity Set and Labour, including fur- niture and pro] is Make-up artists and material ... Original story and scenario Preliminary expenses and over- heads Camera crew Production Manager's Depart- ment (including buyer) . ... Art Director and Assistant Director and assistants Continuity and other floor staff Sound crew Film stock and lamp charges ... Cost and extras ... Insurance ... ... 1.500 3.000 350 500 1,000 2.500 175 300 251 1 1.000 251 1 750 250 400 150 300 200 400 1.000 1.500 50 15H 200 350 1.000 2.000 1 .500 2,500 L75 350 68,050 £16.000 (b) Sidaiii S, While approving of a clause similar to S. 27. 3 (IV), it is felt that tin- large proportion of manual and semi-manual labour required en a production must have saved many a company from breaking the 75 per cent. British salaries stipulation and on occasions a " star's " salary has been suddenly in- creased in order to keep on the right side of the \rt. Wages paid to carpenters, electricians, etc.. who would lie British employees anyway, should not he eligible for inclusion in such a salaries clause, MINUTES OF EVIDENCE 73 19 May, 1936.] Mr. S. H. Cole, Mr. D. Dickinson and Mr. G. H. Elvin. [Continued. and The Association of Cine-Technicians urges that the 75 per cent, clause sliould relate to techniciciAis only. By technicians is meant persons employed in the following departments of film production: — (i) Camera, (ii) Sound, (iii) Scenario, (iv) Editing and cutting, (v) Art. (vi) Floor and Production (Assistant Directors, Associate Producers, Production Manager, Script Girls, etc.). (vii) Stills, (viii) Musical (Musical Director), (ix) Make-up. (x) Sound maintenance, (xi) Projection. (II) Quota Percentages. (a) Renters' Quota. The renters' quota at present existing should be in creased gradually until it has reached 25 per cent. of its imported product — say to 22£ per cent, in 1940 and to 25 per cent, in 1942 and thereafter. Twenty- five per cent, would be a reasonable maximum. (b) Exhibitors' Quota. Exhibitors' quota should be reduced to 50 per cent. of the renters' quota suggested in (II) above i.e., from 10 per cent, to 12J per cent. This recom- mendation is made subject to recommendations (I) as to maximum cost bring incorporated] in the new Act. The Association of Cine-Technicians feels that these two suggestions would be a great stimulus to the production of better quality British pictures. With a reduced exhibitors' quota the renters would have to ,SELL their British pictures on a more competitive basis than at present. It is preferable to make pictures that exhibitors want to show rather than pictures they are forced to show in order to comply with the regulations. Reduced exhibitors' quota would encourage the manufacture of pictures which would have to sell on their own merits. On occasions producers would even find it commercially advisable to spend more than the suggested minimum of £12,000 — and more time in production, in order to make a competitive British picture. (c) Films for Specialised Halls. The Association of Cine-Technicians is of the opinion that the new Act sliould include some clause safeguarding the showing of non-commercial foreign films. It is understood that bodies such as Film Societies have in the past broken quota regulations and it is felt that the activities of such societies should receive some form of protection. There should be, if at all possible, a method devised whereby films whose total showing during any one year only total a few days should not be classed under the same quota regulations as the ordinary commercial film. (d) Penalties for non-compliance with the " Quota " Provisions. The Association would draw attention to the state- ment by Mr. Runciman, President of the Board of Trade, in the House of Commons on 18th February, 1936, to the effect that the number of exhibitors who failed to meet their obligations under the Cinematograph Films Act, 1927, in the three years ended 30th September, 1934, iwas 448, and that proceedings were only considered necessary in 14 cases. The number of renters who failed to meet their obligations during the three years ended 3'Hh September, 1935, was 17, and proceedings were only considered necessary in one case. Under the present Act, the Board of Trade licence may be withdrawn if contravention of the Act is deliberate. In the opinion of this Association the revocation should bo automatic for a period of not less than one year. It is possible that certain renters might prefer, in order to avoid paying, for example, the suggested £12,000 minimum for a picture, to pay a fine under Section 24, Clause lb, for default. To prevent this we suggest : — (i) that the fine be a flat £500 and not less, and (ii) that Section 24, Clause 2, referring to revocation of licences, should be made more stringent, so that three successive contraventions, whether deliberate or not, should automatically result in the withdrawal of the Board of Trade licence for a period of at least one year, as well as the fine mentioned above. While it is noted that it was 6tated by Mr. Runciman that a large proportion of the non- compliances quoted above were small, or due to special circumstances, the Association feels that renters and exhibitors should nevertheless be forced to meet their "quota" obligations. The Association suggests that both exhibitors and renters who fail to meet their " quota " obligations for whatever reason, and whatever other penalties are imposed, should have the amount of footage by which they fail to do so in any one year added to their next year's " quota " footage. If for any reason during the next year the renter or exhibitor fails to meet his double obligation, he should incur a further fine and his licence should be revoked indefinitely. (e) Cutting of films after registration. The Association of Cine-Technicians is of the opinion that films registered by renters as of a certain length MUST be exhibited by exhibitors at their full length. Any exhibitor failing to comply with these regulations should be liable to the same penalties as apply to renters under Clause 10 of the present Act. It is widely alleged that certain exhibitors have helped to discredit British films by the manner in which they have deleted portions of such films for exhibition after a film has been registered at a certain length. This, not being done by competent technicians in the course of production, but by the exhibitor in a haphazard manner, almost invariably destroys the dramatic continuity of the film. (III) Double Bookings. It is felt that safeguards should be made in a new Cinematograph Films Act to remedy the existing practice of double bookings. By "double booking " is meant the practice by which an exhibitor is sometimes persuaded by the renter to 'book, together with the feature film which he desires to show, shorts and other films by the same company. The exhibitor, who could not afford the price of the feature film alone, can only obtain it by showing an entire programme supplied by the renting com- pany. The percentage of the takings apportioned to the feature and the other films may be a gross exaggeration of their respective proportionate values. In other words, the " quota " picture is not sold at its true value. Blind booking was prohibited in the Act of 1927 and we suggest that double booking should now be restricted. (IV) Documentary Films. The Act at present excludes from quota the follow- ing classes of film : — (a) Films depicting wholly or mainly news and current events. (b) Films depicting wholly or mainly natural scenery. (c) Films being wholly or mainly commercial advertisements. (d) Films used wholly or mainly by educa- tional institutions for educational purposes. (e) Films depicting wholly or mainly industrial or manufacturing processes. (/) Scientific films including natural history films. 36152 COMMITTEE ON CINEMATOGRAPH FILMS 19 May, 1936.] Mr. S. H. Cole, Mr. D. Dickinson and Mr. G. H. Elvin. [Continued. but allows renters' quota to any such, films which, if registered, are deemed to have special exhibition value. It is felt that this practice hampers the pro- duction of this type of film, and we draw attention to the special case separately presented by the Associated Realist Film Producers, Ltd. This body is affiliated to the Association of Cine-Technicians and we support in its entirely its recommendations. It will be noticed from the Board of Trade returns for the year ended 30th March, 1934, that whereas the production of long British films easily exceeded the quota regulation of 20 per cent., as stipulated in the present Act, the production of British " shorts " .was only 4-2 per cent, of the number of imported " shorts." We feel that within the spirit of the present Act this also should have been 20 per cent. This deficit was only remedied by the excess production of long films. The actual figures were-: — British. Foreign. Percentage Feet. Feet. 1,161,000 3,036,000 38-2 32,000 760,000 4-2 Long Short We suggest that the new Act should divide quota into two classes — Long and Short Films. That is, instead of productions of all lengths being counted for quota as a whole, as it is under the present Act, renters and exhibitors should have to satisfy quota both as to long and short films. The definition of a short film should be " any of 3,000 feet in length, or less." It is further suggested that short films available for quota should exclude : — (a) Advertising films (for which payment is made to the exhibitor), (o) Trailers. (c) Newsreels. (d) Any films distributed free of charge. And should be divided into two categories : — (A) Studio Films : which fulfil the conditions of quota under Section 3, Clause 27, of the present Act, which section we suggest continues to apply to such films. (B) Other than Studio Films. The association feels that documentary films should be given an opportunity to rank as quota, while still excluding, as in the present Act, trivial scenic and interest films made without a scenario and with- out constructive intention. It is, therefore, suggested that films in this category should rank for quota subject to the following conditions : — (i) They should be made to a pre-arranged scenario. (ii) The scenario should be deposited before the film is made, and after production it should be compared with the shot-by-shot description of the film. If the two are in general agree- ment, then we consider that the film should be eligible for quota. If there is a great dis- crepancy between the two, then we suggest that the film should go before a sub-committee, as proposed in the evidence of Associated Realist Film Producers, Ltd. (V) British Dominions. The next Act should be confined to pictures made in the British Isles, but there should be some re- ciprocal arrangement, preferably a one-to-one basis, with the Dominions. At present certain pictures made in some of the Dominions may be used to comply with the Act, and yet actual pictures made are dismal failures from a quality viewpoint. For example, one company bought two silent pictures made in India which the C.E.A. report refused to "mark" as they were of no entertainment value whatsoever. A company has recently been formed in Canada in order to make 18 pictures to conform with the quota regulations. At present the Canadian industry has not been able to produce good pictures, and a statement has been made that bad as English " quickies " may be, certain Canadian, ones are very much worse. (VI) Privileged Technicians. According to Clause 27, 3 (111), of the present Act, the scenarist appears to be in a privileged position as against other grades of workers, which include Cameramen, Sound Recordists, Art Direc- tors, Editors and Cutters. Still Photographers, Directors, Assistant Directors, Make-up Artists, etc. While not wishing to change the position as regards the Scenarist, the Association would like the possi- bility considered of putting other classes of tech- nicians, which can and should be entirely British, in this category as well. We suggest that not more than one foreign technician shall be employed in the whole of the above classes of technicians on any one picture. If, for example, the production company desires to engage a foreign cameraman, the rest of the technicians employed would have to be British (in all the above departments) to enable a film to qualify for quota. (VII) Interpretation of Act. Recent correspondence between the Board of Trade and a major studio requesting a definition of " scenario " emphasises the necessity of a glos- sary defining technical terms, etc., being added to any subsequent Act. In drawing up such a glos- sary, the Association of Cine-Technicians, as the only body representative of film technicians, would be happy to co-operate. An indication of the type of glossary suggested is published in " Filmcraft." by Adrian Brunei (Newnes, 3s. 6d. net). (VIII) Advisory Committee Appointed under the C.F.A. The C.F.A. , 1927, provides for a Committee to advise the Board of Trade on the administration of the provisions of the Act. The Committee is at present constituted of two representatives of film makers, two representatives of film -renters, four representatives of film exhibitors, and five persons having no pecuniary interest in any part of the film industry. Employees have no representatives on the Committee. As the Act, however, covers many matters which directly affect employees, and it is hoped that the next Act will include still more clauses of this nature, it appears both reasonable and advisable that the Committee, and its powers, should be extended. The film industry is responsible for the employment of a very large number of persons, and, as it is their livelihood which the Act claims to protect, the Association of Cine-Technicians feels strongly llmt employees' representatives — particularly on the production side — appointed through their respective organisations should be on this Committee. Conclusion. Because of the mis-application of the original purpose of the Act, British technicians have ac- quired an undeservedly bad reputation. Working on cheap quota pictures, sponsored by foreign renters, they have had little chance to develop their potential ability. British technicians, where given the opportunity, can do well. Productions made by entirely or almost entirely British labour include: "Escape Me Sever." "Nell Gwyn," "Turn of tin Tide," " .1 Woman Alone," "Secret Agent," "Thirty-Nine Steps," ■•'The Man Who Knew Too Much." "Night Mad." " U.B.C.. The Void of Britain" " Blackmail," d " Queen of Hearts." It the Ait is not renewed there might be con- siderable unemployment resulting not only to British technicians but to manual, semi-manual and clerical workers. MINUTES OF EVIDENCE 75 19 May, 1936.] Mr. S. H. Cole, Mr. D. Dickinson and Mr. G. H. Elvin. [Contin in (I . In spite of the failings, pointed out in this State- ment, which can hardly be avoided in a first Act of this description, this Association feels that the " Quota Act " has to a large extent achieved its original aims. The main purpose underlying the new Act should be to promote the production of good films arid to preclude the profitable exploita- tion of bad films produced under the protection of an Act of Parliament. If the abuses of this first Act are remedied, and a further Act is put in force, the Association of Cine-Technicians looks forward to the British film industry growing into one of the largest of British industries. 569. (Chairman) : I am sorry we are not a full Committee. Sir Arnold Wilson will be here later. We have all read your memorandum, and I am not going to take you through it page by page, but I will just ask you to develop a few points. I understand Mr. Elvin will talk for the three of you. If any of you have anything to add on a particular point, please do so. Please tell me how far you are representative of the cine-tech- nicians? You mention 1,000 membership? — (Mr. Elvin) : We cater for everybody engaged on the production and technical side of British films, of whom at least 80 per cent, are members of our Association. 570. At the end of the paper you suggest cer- tain classes should be left out from Form C, do you not? In paragraph (I) (b), is that a distinction at present, there is a list? — Oh! yes. 571. There is a list of eleven classes. That really covers all? — That covers the whole of the technical side. That includes the make-up artists who are members of another organisation and not of our Association. That is the only difference. 572. But the other ten classes are all included ? — In our organisation, yes. 573. Is there any alternative organisation, or are you the sole representative organisation? — No, there is no alternative, but there is one which I believe you have seen, the documentary film directors who have their own Association which is affiliated to us, the Associated Realist Film Producers, Ltd. We are the only organisation on the technical side. 574. The Associated Realist Film Producers Ltd. have a separate branch in the Cine-Technicians? — That is right, yes. 575. I see. Well now, on the first page you de- precate the suggestion that the renters' quota should be reduced. Do you purposely pick out the renters' quota as opposed to the exhibitors' quota, because it would appear the really effective quota is the exhibitors' quota? The renters' quota is merely a compulsion to offer films, but not to get them shown? The exhibitors' quota is apparently the more effective because it compels people to show them. Do you purposely attach more importance to the renters' quota than the exhibitors' quota? — Yes, we mention one should be a percentage of the other. We suggest exhibitors' quota be a definite percentage of renters' quota, and the exhibitors then have some choice. This year they have the same percentage quota and roughly an exhibitor has little choice of what he shows. If the exhibitors' quota is half of the renters' quota he has a choice of what films he shows and what he does not, and we feel there would be an encouragement to producers to make better quality films. 576. In fact he has a bigger choice than would appear from the quota figures, because there is a growing number of films which are registered and are available for exhibitors' quota but are not shown in the renters' quota figures as ranking against any foreign film, is not that so? — That is so. 577. And so there really is a greater abundance of British films for the exhibitor to choose from than the bare quota figures suggest? — That is so. 578. But you are not satsfied there is a sufficiency and think the exhibitor is sometimes embarrassed in finding his choice at the present time? — Could Mr. Cole answer that point? (Mr. Cole) : We agree that there is a greater choice than would appear from 36452 the actual quota figures, but from our point of view we are concerned with the quality of pictures. We would relate our answer to that question to our other suggestion which we make about the minimum expenditure clause, to the £12,000 minimum which we suggest with a view to such films as are made to comply with quota regulations being of better quality. If you have a smaller exhibitors' quota, which means they have to show less, from our point of view that would lead to the result that films would be made of better quality in order to induce exhibitors to show them from a purely com- mercial view point, and not merely to fulfil their quota obligations. 579. It is obvious you cannot do without a renters' quota at present. If you cut out the films produced probably rather against the wishes of the interests that order them, there would be a shortage; but if you could get a strong output of British films would it not be possible in future to work up to the condition where you could drop the renters' quota altogether and concentrate upon the exhibitors' quota? — (Mr. Elvin): We feel the renters' quota is more important since we are concerned more with the actual production of films. The renter takes a film from the producer, and if the films are made — and they are bound to be with the suggestion, as far as we are concerned, of a minimum cost — then a renter will not rent films which will not be exhibited. He will naturally rent films on which he will get his money back. 580. But you told us further on they do now produce films without any expectation of showing them ? — Quite. 581. And it does seem this system at present works to produce a lot of bad films which would not be made except for the system? — Yes. 582. It may be you will be able to provide against that by some other method, but for the moment it does seem rather a serious problem that the Act is causing the output of some very bad films that would not otherwise be made? — Quite. 583. Anyhow, you do not think we can deal with that by working up to the abolition of the renters' quota : you feel that has always to be kept and pro- duction will not look after itself? — That is our point. 584. You mention here, near the end of your first paragraph on the growth of the industry; that a circular has been sent to the industry. I understand that there is no such circular, and if you have any first hand information as to the growth of the industry, perhaps you would like to give it to us. Do not trouble if you have not brought it? — We have not brought it. I went merely by the Press, which stated it had gone out. Apparently it was erroiieous. 585. We have not that particular source of in- formation available? — We relied upon the Press. 586. In paragraph 1 you say that it often hap- pens that these films are produced without any ex- pectation of showing. You quote a retort, '■ What does it matter — the film will never be shown." Does it in practice ever happen that these films are not shown at all? — Oh! yes. It happens in some cases that a renter particularly may not rent out the films if he has got them to comply with his quota. They may not on occasions be shown, but also it is bound up particularly with " shown " in the gen- erally approved sense, and we mention films which in theory are shown but in practice are not. They are shown in the early hours of the morning, or late at night, when there is no public there to see them. 587. Are there any cases where a film has never been shown at all that comes into the renters' quota? — I have just been reminded of a case. There is a case mentioned in this report later on where one company acquired two silent films for quota pur- poses and the exhibitors' journal refused to mark them owing to their poor quality, and in practice I believe they were not shown at all. K2 76 COMMITTEE ON CINEMATOGRAPH FILMS 19 May, 1936.] Mr. S. H. Cole, Mr. D. Dickinson and Mr. G. H. Ei.vin. [Continued. 588. That is an exceptional case. Generally they are shown? — Yes, that is an exceptional case. 589. This case which you mention in paragraph 3, showing the film to the charwomen, is a great diffi- culty, because it seems to comply with the Act, and suppose the film was shown in the normal hours in the ordinary programme; I suppose you cannot work out your quota within a single performance. Do you see any amendments which could cover this point and prevent them showing unpopular films for quota purposes at undesirable hours? — That is again bound up with our chief point of quality. If a film is good enough to be shown, in a lot of cases it will be shown, but in some of these cases they are poor films. 590. It probably will disappear if you can raise the quality? — Yes. 591. Then, in paragraph 3, at the end of the section dealing with charwomen, where it is a quota- tion, it is said that the Act should be extended under conditions that will ensure quality and guaran- tee exhibition. Of course, you did not write this? —No. 592. But can you give us any idea what guarantee of exhibition was in the writer's mind ? — Quality is the main guarantee. 593. Really, guaranteeing exhibition means nothing. The important thing is to ensure quality? Yes. 594. Well, then let us come to paragraph (1) (a). You make a proposal that films should have a total cost of £12,000 per six thousand feet to make them eligible for quota. Do you prefer this total basis to the Form C basis with which you are no doubt familiar — Form C excludes certain costs from the calculations? — I see. 595. It would be quite easy to adjust your pro- posals to that other basis which leaves out certain expenditure which may be a little misleading in this connection? — We find it is very difficult, par- ticularly in the. film industry where jobs do not necessarily have the names under which they go, to simplify it or get it in such a space that you could definitely say that you could exclude or would include certain types of work, and we think this is the best way of doing it. 596. You deliberately prefer the total cost of the Form C cost basis? — Yes, definitely. Could Mr. Dickinson amplify that? (Mr. Dickinson) : It seems if a renter had to deal only in films that cost £12,000 each for his quota requirements the amount of money he would have to spend would be so great that he would not be able to market pictures which had no hope of being shown. He would have to get good pictures which would rely upon their enter- tainment value to have any hope at all. Pictures would be so good they could mingle with the American renters' own product in direct competition — which seems unfair to American renters, but the quota Act was a tax on imported foreign films, and the idea was that the money should be used to build up an English film industry. 597. I am not in doubt as to your purpose, I am only wondering whether the more convenient measure would be the Form C basis which I understand works out the classes of expenditure which come in on the Form to about half the total cost. It would be quite easy to adjust your figures to a lower figure on Form C, and you would get exactly the sarin- result if you fixed the figure of the Form C total at the proper proportion of the total cost. It might be you would exclude certain classes of cost by the Form C basis which are a little misleading and apt to be extravagant. It would strike out artificial extravagance, perhaps? — We would prefer total costs. 598. You would prefer total costs to Form C when modified to be adjusted to your purposes. If you had Form C you achieve that object which you mention in the next paragraph to some extent, and in that way you would exclude the company director's fees. preliminary expenses, overheads, and story cost. The other things do not come in, so instead of limiting them to 30 per cent, you would have them excluded altogether and get an adjusted figure perhaps on Form C ; but anyhow, you prefer the total figure ? — {Mr. Elvin) : Yes. 599. Then, in paragraph (I) (b) . the salaries. In- stead of cutting out the manual and semi-manual labour, would it not be perhaps more convenient to deal with this matter by raising the percentage and keeping them in? I do not know what they come to? — Yes, if the percentage was raised high enough. Our point is the manual and semi-manual always is British labour, and in our opinion 75 per cent, is the right percentage excluding those two types of work. 600. If we kept manual and semi-manual in on this present system how much ought the percentage to be increased to cover them ? — (Mr. Cole): I think another reason why we excluded manual labour and elec- tricians, and so on, is that very often, especially in the production of " quickie " films a large amount of overtime is worked, and that does not result in tech- nicians getting more money. Technicians do not get any more money whether they work 12 or 24 hours a day. The electrician and manual labourer do, so it is much more difficult to say what proportion of the salary costs on a " quickie " film will be drawn by manual labourers than it is to say what amount will be drawn by technicians, and that is a strong reason for excluding manual labourers. 601. Then, in paragraph (II) (c), films for specialised halls. You would like the Act replacing the present Act to deal with the safeguarding of non- commercial foreign films. Is not there some difficulty about a hard and fast legislative provision for this? Is there not always the danger that you will let into your exemption cases which do not deserve it, where people are using the films as part of a very big volume of exhibition and where they quite well could cover it by the quota. If there is that danger do you see any objection to leaving this provision for non-commercial foreign films to the discretion of the Board of Trade anyway? — Oh, yes, we put that in because we wanted some remedy to the present position, but if there was a provision in the Act . . . 602. You will be prepared to leave it to the Board of Trade?— (Mr. Cole): Film Societies know at the moment that they have to, and they do, very often break the letter of the law in pursuing the showing of specialised films. They should not have to feel that, but they should feel they could do something at the discretion of the Board of Trade. That would be all right. We agree it is bad to legislate for exceptional cases and much better to legislate for the general ones and have a discretion for the exceptional ones. 603. In paragraph (II) (d) you draw attention to the necessity for increasing the penalties for breach of quota requirements in view of the bigger financial incentive to break these regulations. But I take it that there will still he cases where breaches are beyond the control of the people concerned. Would you keep the discretion to the Board of Trade to give relief where special circumstances are shown? — (Mr. Ei.vin) : Yes, but then we do urge, nevertheless, our paragraph with reference to the footage by which a renter fails should he added to his next year's quota whether the offence is inadvertent or deliberate. I think that is probably a justifiable clause that the footage must be added on to next year; but we realise there are cases where the Board of Trade must use discretion. 604. It is clear the penalties would have to be reviewed before being re-enacted. Now, as to double bookings, a great deal of trouble is really due to block booking, that the exhibitors are forced to take a bad film as part of the price of taking a good one. Do you think it would he desirable to make block booking an offence just as blind booking has been made an offence? — I think it would, hut. of course, it may raise certain difficulties. I think at any rate it would be a move in the right direction. It would certainly remedy the present position. MINUTES OF EVIDENCE 77 19 May, 1936.] Mr. S. H. Cole, Mr. D. Dickinson and Mr. C. H. Elvin. [ ( 'on l in in ■! . 605. Could you not deal with it by means of declaration? — Put it as an obligation on those con- cerned that they have to make a declaration that there is no block booking taking place? — I do not know if it is possible. There has to be a certain amount of block booking, I imagine. 606. You think there must he? — There must be owing to the limited number of renters. 607. Yes, block booking in the form of the exhibitor saying he wants two films from the renters may be quite unobjectionable. But it is a very different matter when a renter forces a bad film — block book- ing by the renter is a very different matter, and free negotiation for two or three films at the same time on the part of the exhibitor would not be prevented. You think it would be difficult to get any provision which would not be oppressive? — If it is possible to put a provision to prevent undue force by the renter on the exhibitor it would be admirable, I think, if it is possible. That is the only point we are uncertain about. 608. In paragraph (vi) you wish to extend the re- quirement of British nationality beyond the scenario writers to cover certain technicians. Are you satis- fied that there is an adequate number of technicians for this purpose? — Oh, yes, there are 120 British technicians out of employment to-day, and a lot of those are first-class men who have been responsible for making first-class films. There are in this country about the same number of foreign techni- cians, some of whom are ace men and indispensible, but as regards a lot of whom their work could be done by British technicians and at no time in our knowledge has there ever been a shortage of British technicians. To-day there are 120 of all types of technicians (camera men, sound recorders, cutters, and so on) out of employment. 609. Is this a new development owing to growth of the industry, or has it been the case for some time? — It is apparently since the growth of the British industry has attracted foreign people into it. The healthy state, in certain ways, of the British film industry is a magnet to foreign technicians to come here. 610. Then in paragraph (viii) you recommend that there should be representation of employees on the Advisory Committee. You are probably aware the main object of that Committee is to advise the Board of Trade as to whether quota defaults are within the control of the people concerned. Could you develop a little why you consider employees' repre- sentatives should be specially qualified to carry out that duty, which does not seem to be very much related to their experience as technicians?— No, quite. We assumed the Advisory Committee was to advise upon the Act generally, and not merely upon the actual question of quota as such and in accord- ance with our evidence here and the present pro- visions of the Act, there are a lot of matters which do naturally concern, and directly concern the workers of the industry. We understood the Advisory Committee was to advise on the Act in general and not on one or two particular points. 611. I understand that they have primarily that rather definitely limited function. But Miss Plumer is a member of the Committee and she may develop that point further. I think that is all I have to ask. 612. (The Hon. Eleanor Plumer): I have only one or two points. In paragraph 2 you speak of your desire for British technicians to be employed on making good pictures, and you say you hope it is possible to find ways and means to make this pos- sible. I suppose the ways and means you have in mind are the suggestions you make further on? Do you consider those to be adequate to bring about this desired result, or are you leaving it to somebody else? — It is bound up with our suggestions here. For instance the one about the greater percentage of British technicians employed, only one foreign technician on a picture, the salary clauses, and so on. All those things should, we hope, make it pos- sible for British technicians to be employed in greater numbers. 613. You consider the suggestions you made .would bring about that result? — Quite. 614. And you think the minimum cost you would impose would ensure quality? — Nothing ensures quality, but it makes it much more likely. Our point is you cannot make, except in very excep- tional cases, a good picture for less than the sug- gested minimum. 615. You could quite easily make a bad picture for more than that money? — You could make a bad picture for £100,000. (Mr. Cole) : If I might develop that point further, while even £60l,000 will not necessarily ensure a picture that is good from an entertainment point of view, it will do so from a technical point of view. That is to say, if a picture has cost £60,000 it may be a picture that audiences will not like, but it will be a picture, generally speaking, upon which the camera man, sound re- corders, editors, and so on, have been able to do their particular job of work with time and oppor- tunity to devote the best of their skill to it. 616. But if they have not produced the result, which presumably is to provide an entertaining picture, it may not be money very [well spent? — It is always worth while to have done a technical job well, because the next picture you work on you may have a better story and a better director. 617. In paragraph 4, under salaries and working conditions, would you be in a position, if you were asked to furnish specific instances in those cases that you quote? — (Mr. Elvin): You mean? 618. With reference to excessive hours, and so on? — Yes — definitely. 619. If asked you could furnish specific instances? — We could give details of hours, and so on, worked in different studios. 620. You say " salaries and working conditions," but you deal with excessive hours mainly and then speak of illogical restriction of expenditure. I quite see that may be so, but it does not seem to quite fit in with the rest of that paragraph? — It is the restriction on the labour employed in the film rather than upon the making of it. If they can get a bad camera man for £15 and a good one for £20 they will tend to employ the not so good at £15. On these pictures we know it is very hard to get the customary salary, and it is mainly on those points and the question of meals and meal allowances that the restriction is prevalent. (Mr. Dickinson) : May I say something about that? I am a camera man, and I have worked on some of these very cheap pictures made only for quota purposes. We have been going to make a scene which would look good photographically, and I have been told we cannot do it because we have not the time — their time meaning money — because they must be finished on Saturday. That is the trouble we are up against. 621. Then in paragraph (II) (d) you suggest rather rigorous penalties for renters and exhibitors who fail to meet their quota obligations; do you think you are quite taking into account the difficulties, which exhibitors state they find in fulfilling their quota obligation, particularly now it is 20 per cent.? —(Mr. Elvin) : Yes, but we suggested the exhibitors' quota be 50 per cent, of the present renters' quota, which would make it easily possible for any exhibi- tor to comply with his quota obligations. 622. Then again, under paragraph (II) (e) you say it is widely alleged that certain exhibitors have helped to discredit British films by the manner in which they have deleted portions of such films for exhibition after a film has been registered at a cer- tain length. Again, in this case, could you furnish specific instances? — Yes, I have notes here. For instance, there was one programme with a foreign feature and a British supporting film. Two entire sequences of the British film were deleted and the film was cut down by eight minutes, and one com- plete character who had a credit on the screen was 78 COMMITTEE ON CINEMATOGRAPH FILMS 19 May, 1936.] Mr. S. H. Cole, Mr. D. Dickinson and Mr. O. H. Elvin. [( 'untinued. cut out of the picture. That actress is now in Hollywood, which suggests that she was not cut out of the picture because she was a bad actress. On that occasion there was a short which lasted ten minutes, and they cut the British film by eight minutes when they could have cut out the short of ten minutes instead. There is another case where the whole of the first reel, including the credit titles, was cut out and the film started on reel 2. 623. I think it is a pity to suggest you have not proofs, when you have? — Perhaps we were too cautious. 624. About double booking, is not double booking blind booking? What is the difference between double and blind booking? — I will ask one of my colleagues to enlarge. (Mr Dickinson) : Blind booking is the booking of a picture or pictures by an exhibitor before he or anyone has seen them. It was the practice for exhibitors before the Act to book even a year before. A renter may have a picture with a very famous star, and every exhibitor is more or less compelled to show this particular picture because his customers require it. The renter is also compelled to have some British pictures, and because of the expense of the particular star they want as much for themselves as they can, and they say, " You can have this special picture for 40 per cent, of the gross," and the exhibitor will say, " I cannot afford that. I have to get the rest of the programme." They say, " We will give you a British picture, and you can have them both for 40 per cent." In their accountancy, and so on, they have to put something for the British picture, so they put 2 per cent, or 3 per cent., or something like that, whereas if the pictures were dealt with separately the British picture would probably take at least 10 per cent, of the gross, but the renters get for themselves more for the special star film than they would otherwise. 625. I should have thought that was illegal? — No, the exhibitors can see it if they want to, and can say, " Yes, I will have the special star film and the quota picture for 40 per cent, the two." This English picture may be terrible or quite good, but he will book it for any percentage for both of them. 626. I think that is all. 627. (Mr. Cameron) : May I start on the last point because I am not quite clear? If a renter charges an inclusive 40 per cent, for a whole pro- gramme, a feature picture and a second feature, that is a form of block booking, is it not? — But, Sir, he does not insist. It is not the renter who says the exhibitor must have the picture, but it is the exhibitor who says he cannot afford the amount of money asked for the big foreign special star picture. So the renter very kindly says, " You can have an English picture with it for nothing," which puts down the income of the manufacturer of the English picture to such an extent that he cannot make a profit on it at all, since he is relying on the honesty of the renter. 628. You suggest that should be made illegal ?- Oh ! please, that is a very hard thing. 629. You suggest that should be made illegal? — How, we do not know. 630. (Chairman): If you could deal with block booking you could cover this. Everybody agrees it is an evil and forces either the bad film or films on unfair terms to the producer upon the exhibitor. I think it is the same case we have had brought to our notice before, but from a rather different angle? — That is a particular weapon in the hands of foreign renters who wish to discredit British pictures, because, after the small returns previously men- tioned, the English producers try to make the cost even less. They know the first picture cost £3,000, and they think, " If we make the next for £2,500, we might get a profit." 631. If you could make it illegal to be given an unfashionable picture as part of the bargain you would deal with that trouble. 632. (The Hon. Eleanor Plumer): If you had your minimum cost they would not be so willing? — They dare not. Some foreign renters would have to pay a little over a quarter of a million and would have to make a profit, which is good for us because they would have to make a picture the exhibitor would want. (Mi-, idle): Everj'thing hinges on our minimum cost. 633. (Chairman) : This question of percentage does not hit the technicians so much as the producer? — (Mr. Dickinson) : Except the technician is forced to do his work even more quickly and cheaply because the producer's income from that picture is so little. He has to do a job in ten minutes instead of ten hours because the producer knows his eventual income would be only £3,000. 634. (Mr. Cameron): You say the interest of technicians urges that the 75 per cent, clause should relate to technicians only? — (Mr. Elvin): Yes, technicians, as defined in our evidence. At present the clause includes labour generally, and all the manual and semi-manual labour is and must be British. 635. What about the artistes, the players? — We suggest there should be some, if you like, other pro- vision, as regards that. WTe are not directly con- cerned with artistes. That is not our pigeon. 636. From our point of view at any rate the ordinary actors — not the star — came into the same category ? — Yes. 637. You do not object to that? — No. Except there is the one point that actors and actresses are paid much more money — especially the stars — than technicians, and it might rather over-weight them if they all come in the percentage. It probably would be preferable to have two percentages, other- wise one star equals in financial remuneration several technicians. 638. In paragraph (II) (c). films for specialised halls, you mention foreign cultural films. Actually some of those films are shown in the public cinema p — But it is a specialised hall for that afternoon. We mean specialised films, and if you like, specialised audiences. 639. I do not think there is anything more. I have various points, but I do not think they specifically concern technicians, and the other questions have been asked. 640. (Chairman): Your membership has no British qualifications? — No. Every technician working in the Uritish film industry is eligible to apply for member- ship. 641. I am sorry Sir Arnold Wilson has not been able to get back from the House of Commons. We are very grateful for the help you have given us. — Thank you for receiving us. (The Witnesses withdrew.) MINUTES OF EVIDENCE 79 26 May, 1936.] Mr. T. H. Fligelstone and Mr. W. R. Fuller. [Continued. FOURTH DAY Tuesday, 26th May, 1936 Present : The Rt. Hou. Lord MOYNE, D.S.O. (Chairman). Mr. A. C. CAMERON, M.C., M.A. Mr. J. S. HOLMES, M.P. The Hon. ELEANOR M. PLUMER. Lt.-Col. Sir ARNOLD WILSON, K.C.I.E., C.S.I., C.M.G., D.S.O., M.P. Mr. W. H. L. PATTERSON (Secretary). Mr. T. H. Fligelstone (President) and Mr. W. R. Fuller (General Secretary), representing the Cinematograph Exhibitors' Association of Great Britain and Ireland, called and examined. The Committee had before them the following memorandum of the Cinematograph Exhibitors' Association of Great Britain and Ireland: — The Membership of the C.E.A. 1. The Cinematograph Exhibitors' Association of Great Britain and Ireland has in membership at the present time 4.017 cinemas. A larger number of places of entertainment find it necessary to apply to the Board of Trade for a licence under the Cine- matograph Films Act, 1927, hence their figures as to the number of cinemas will be larger than our membership. It may, however, be taken for granted that our figures represent for all practical purposes 100 per cent, of the cinemas open regularly six or seven days a week. The Effects of the Cinematograph Films Act, 1927. 2. We are happy to inform you that there is general agreement amongst our members upon the evidence which we now submit. We have also followed the course, which we have adopted on all previous occasions with H.M. Ministers and with the Board of Trade, of stating exactly what we feel we require, rather than to present a case on the basis that a compromise is inevitable and that a margin of over-statement is necessary. 3. We anticipate that the Board of Trade will furnish the Committee with a full and comprehensive historical survey of the Cinematograph Films Act (which we shall refer to in future as the Films Act). Therefore, our historical references can be brief, and directed to the points which we need to emphasise. 4. Before the Films Act came into operation it was calculated that British films were only enjoying 3 per cent, of the playing time at the cinemas in this country. The last return of the Board of Trade indicates that the Act has succeeded in its object of " securing the renting and exhibition of a certain proportion of British films " since exhibitors' returns testily that 26-09 per cent, of British films were shown during the 12 months ended 30th September, 1934.* To the credit of the Films Act may be placed the establishment of a considerable British production industry from which has emerged films that are comparable with the best produced anywhere in the world. By way of contrast, it is also re- sponsible for some of the worst films. The " quota quickie " produced in this country is probably worse than the worst foreign film, and its only competitors have been some Dominion productions, which happen to qualify for registration as British films. 5. Nothing affects the prestige of British films so much as the exhibition of poor British films, and it is in the public interest that production of this type of film should be eliminated. * No figures for 1935 are yet published but it is understood that they are substantially the same as for 1934. 6. The measure of protection afforded by the Films Act attracted considerable finance to the cinemato- graph industry. Some went to mushroom companies and was quickly lost. Vast sums, however, were invested in the larger concerns, and to-day we not only have very fine studios, but also large circuits of cinemas. We want to emphasise the growth of circuits, which was more or less coincident with the passing of the Films Act. We shall refer to the circuits later in our evidence, but not in the ill- informed manner of some who attribute a number of undefined deficiencies in an unexplained way to what is called a tied house system. Our emphasis will be upon the booking power which a circuit possesses, and its consequent ability to secure the best films against individual and independent exhibitors. It was apparent at the end of last year that nine cir- cuits between them controlled 652 first run cinemas, which represented about half the first run situations, and these in turn dominated the booking situation. 7. Exhibitors have more than fulfilled their statu- tory obligation to show specified percentages of registered British footage, and their loyal support of the Films Act has been publicly acknowledged by respective Presidents of the Board of Trade, and testimony has also been paid to the very cordial relations which have always existed between the Board of Trade and the Cinematograph Exhibitors' Association. In our turn we should like to express our appreciation of the smooth and considerate ad- ministration which has been an outstanding feature of the work of the Department. The Quota upon Exhibitors. 8. We regret to have to introduce a plaintive note amid such cordiality, and we therefore will proceed at once to the section of the Films Act which occa- sions us the greatest concern, which is the exhibitors' quota. 9. The ramifications of our industry, especially among apparatus for the equipment of our cinemas, bring us into contact with various forms of protec- tive legislation. Some of our apparatus is subject to an import duty, and in such cases in the event of dissatisfaction as to quality, we can always pay a little more and secure the right article. This safeguard renders such recourse as a rule unneces- sary. Some Key Industry Dut\ Legislation is pro- tective, but in this respect we were consulted and had every opportunity of protecting ourselves in re- gard to quality and price. Quota legislation, as exemplified by tin' Films Act, has an entirely different mode of operation, and when designed to secure production and exhibition, exhibitors would be liable to detrimental exploitation by producers 80 COMMITTEE ON CINEMATOGRAPH FILMS 26 May, 1936.] Mr. T. H: Fligelstone and Mr. W. R. Fuli.ee. [Continued. unless a surplus of suitable product, fit for exhibi- tion to the public, is secured from which a selection can he made. 10. For exhibitors the margin of selection becomes all-important. Until 1933 there was little difficulty in complying with quota, but during the last two years complaints have continued to increase, and to-day the observance of a 20 per cent, quota is prov- ing a very severe test. There are several causes: — (1) The foreign (American) renters until about the end of 1931 or 1932 appeared to be making a grudging endeavour to produce or to acquire British films suitable for public exhibition. In this process they averred the loss of money. On account of the financial depression in their own country they seemed to come to a settled policy of acquiring generally " quota quickies " which, being unsuitable for exhibition to the public, reduced the margin of selection to exhibitors. (2) In the last three years production of usable British films has not made any material in- crease. The figures of registration of long films in the last three years are as follows: — 1934 1935 1936 195 190 215 (3) Public opinion in certain areas, particu- larly in parts of Scotland and parts of London, has become definitely resentful of the increasing number of British films which must be compul- sorily screened. (4) British shorts are not produced in sufficient numbers. Exhibitors, therefore, find their troubles increased by the necessity of acquiring " long " British films which, in effect, increases a 20 per cent, quota to about 24 per cent. (5) The best and most consistent producers or distributors of British films are allied with circuits. 11. We have made an analysis of British films trade-shown in the calendar year (not the film year) of 1935. During that year, according to our records, 178 films were trade-shown. This number, according to our viewers, may be classified as follows: — Good First Features ... ... ... 73 Varying Second Features ... ... 41 Inferior ... ... ... ... ... 31 Definitely unshowable ... ... ... 33 178 12. We are aware that the Board of Trade shows registrations of 198 films for this period. We can only assume that the extra twenty were of such poor quality that trade shows may have passed un- observed by us, as no complaints of omission were received from our members. The American distributing houses .were responsible for a majority of the films in the last two categories. 13. The figure of 178 is a misleading total. But for the compulsory provisions of the quota 64 films of this total would never be booked by exhibitors in a market where exhibitors were free to book their choice. For practical purposes we may say that the output of British films for booking in 1935 was 114. 14. We now come to the all-important matter for exhibitors, which saves them from exploitation, which is fche margin of selection. 15. The original quola scale was drawn up on the basis that it would provide two films from which an exhibitor could select one. His choice was always one out of two. It was estimated that by the present time British production would have expanded to such an extent that differentiation between renters' and exhibitors' quota .would not be necessary. Un- fortunately the " quickie " was not envisaged. 16. Exhibitors normally book a number of feature films each year varying according to the character of the cinema from 104 to 208. For purposes of average we may take a figure ranging from 120 to 160 films. On a rule of thumb basis, which is sufficiently accurate for purposes of generalisation, it will be seen that the normal better class hall requires about 24 British films a year to satisfy its quota while the normal industrial cinema will require 32 to 40 British films a year. 17. When the Films Act came into operation there were usually three cinemas competing in any given town or district. To-day in the populous areas there are as many as five or six cinemas competing for patronage. 18. Very few British films (or, for that matter, American) are of such outstanding calibre that more than one run is possible in any town or district. 19. It will be seen that in the principal areas on the 1935 showings exhibitors have no margin of choice. The 114 British films, varying from good first to second features, tabulated on page 7, are booked without any choice. 20. The position for the independent exhibitors is made much worse when the best films are taken by the circuits, which, in addition by virtue of their booking powers, are able to book some of the better British films marketed by other producers. 21 . For the independents in such situations there remains the constant nightmare of sorting through inferior and bad films in an endeavour to find something that will not repel any more of their patrons than can be avoided. 22. Through a sense of loyalty to the Films Act, many exhibitors are weary of the constant loss of money which they suffer through constantly having to show British films to which the public does not respond, when there is available a considerable margin of selection in foreign (American) films to which the public would respond. 21. We have therefore come to the definite con- clusion that the original intentions of the Films Act, that there should be a margin of two films from which to select one, should be the standard for future legislation. We accordingly ask that the quota upon exhibitors should be reduced at the earliest possible moment to 10 per cent. 24. We would emphasise our unwillingness to con- tinue to suffer heavy financial sacrifice by continuing to show British pictures unacceptable to our patrons and to rely upon the sympathetic administration of the Board of Trade in the event of default. It is not fair to the Board of Trade to place upon it the responsibility of endeavouring to smooth away the difficulties arising from an excessive quota upon exhibitors. Nor is it fair that we should be com- pelled to be ever searching through an inadequate number of films in an endeavour to satisfy the onus placed upon us to show in the event of defaidt that the films were commercially impracticable. Ax INCREASED QUOTA A FANTASTIC IDEA. 25. Concerning other suggestions which we have heard of a quota rising to 35 per cent., we regard such proposals as Eantastic and unnecessary. Am legislation for an increase of quota would, .we venture to predict, result in an orgy of prospectuses with much resulting loss to the investing public. British films, when good, have sufficiently established them- selves that an increase in quota is unnecessary for their development. They can now increase in numbers on their quality without any further arti- ficial stimulus. As our request is for a substantial reduction of quota it follows that we shall resist to the fullest extent any proposals to increase the quota upon exhibitors. MINUTES OF EVIDENCE 81 26 May, 1936.] Mr. T. H. Fligelstone and Mr. W. R. Fuller. [Continued. 26. In regard to the quota upon renters, we ask that it should be fixed at such a percentage as will produce a margin of selection of two films for every one which we have compulsorily to book. We ask for the opportunity of submitting our views as to the figure of exhibitors' quota if the Committee reaches any decision as to the scale of the renters' quota. 27. We shall oppose any suggestions which dim- inish the footage obligations imposed upon renters unless after consideration it appears that such scheme(s) is desirable and ensures a corresponding reduction in the footage imposed upon exhibitors and also secures a margin of choice to which we have referred. Cost Qualification. 28. We are not in favour of the suggested solution of cost as a basis of qualification as we are not convinced that it will be the means of increasing production. On the contrary, we anticipate that its introduction would be followed by a consider- able decrease. The figure which has been mooted, namely, £2 per foot, is of little value. A good film generally costs in the making io-day from £25,000 to £30,000 at least. If either of these figures be instituted the effect would not be to pro- duce more British pictures, but would shut out from this market a considerable number of foreign films — which it .would no longer pay to import on account of the attendant expenses of acquir- ing British quota. Any larger sum, if imposed, would simply lead to evasions, possibly by the manu- facture by foreign distributors of British " quickies " in the Dominions. General increase in production costs will also drive out of business most of the smaller producers whom we should x,refer to remain. Quality clause. 29. When the Films Act was under consideration we suggested that a Committee should be set up which could review the registration of Biitish films on the ground that they were lacking in enter- tainment value. In other words, such a Committee would be empowered to disallow the type of British film which we know as a " quota quickie." We were told at the time that such a Committee would not be accepted by the Board of Trade as the President at the time did not approve it. He never advanced any reasons, and we bowed to his decision. We find that such a provision has since been introduced in the quota) legislation of the New South Wales Parliament Act, No. 41, 1935. It is as follows : " 3.— (1) This Act shall apply to all films ex- cept films of the following classes, namely : — (g) Australian films, in respect of which the Minister upon the recommendation of the Films Advisory Committee constituted under this Act has directed that this Act shall not apply on the ground that their artistic or photographic merrfc, or their appeal to the interest of the public gener- ally, or their general quality is not suf- ficient to warrant their being taken into account for the purposes of computing the distributors' quota or the exhibitors' quota in accordance with this Act." The constitution of the New South Wales Advisory Committee is set forth in Clause 11, but we submit that a different constitution would be necessary in this country. We have in mind a constitution somewhat similar to the present Advisory Committee to the Board of Trade in which the proportions of the various trade interests are preserved, but perhaps smaller in numbers to enable it to be called together as frequently as required. 36452 K.R.S. Booking Policy. 30. Our references to the purchasing and booking power of the circuits may perhaps prompt the ques- tion why the independent exhibitors, who are numeri- cally so much stronger, do not combine and pool their bookings and so protect themselves. The renters maintain an absolute solidarity in refusing to let any exhibitor already booking for a cinema book for any other cinemas unless he owns 51 per cent, in the second or subsequent cinemas for which he proposes to book. This is known as the K.R.S. booking policy, and as it is subscribed to loyally by the members of that Society, which comprises all the principal renters, British and foreign, no question of nationality arises. Exhibitors strongly protest but are helpless. In its application to British films the circuits through their alliances with the producers are always at an advantage and the independents are at a perpetual disadvantage. 31. The object of the policy has been to keep exhibitors in competition with one another, and for the purpose of increasing and maintaining high film rentals. In the earlier years of the Films Act we should have hesitated to have brought for- ward this point as we might have been met with the contention that it was not the object of an Act of Parliament to seek to endow one section of the trade with the means of securing the goods of another section at a lower price. To-day any such contention can no longer be advanced because circuits have increased, the number of cinemas have increased — as well as an enormous growth in their seating capacity — so that prices look after them- selves. The effect of the K.R.S. booking policy to- day is simply to advantage the circuits in acquiring the best films — and, incidentally, the best British films — leaving the independent exhibitors to take what is left. We submit very strongly that this Committee should lay down as a condition of recom- mending the granting of continuing protection to the British producers that all exhibitors, whether circuits or independents, should be placed in an equally favoured position to bid for the British films suitable for exhibition to the public. The amendment would not present any serious difficulty merely requiring definition of " renting " in rela- tion to films to rent or issue British and /or foreign films to exhibitors or their accredited agents. If academic protests are made concerning inter- ference with the right to conduct business as one pleases, Part I of the Films Act affords a sufficient answer. The back door of the Dominions. 32. We would draw attention to the fact that the worst " quota quickies " come from the Dominions. We would refer to recent registrations of three Indian silent films, one Australian and a Canadian, which were without any value whatever and cannot be shown to the public. The quality clause, which we suggest is the simplest method of elimination of this class of film. We have doubts as to the manner in which a cost clause would operate in practice as an effective safeguard. We do not know .what means there would be of checking ex- penditure incurred in the Dominions. This back door must be closed. As it is ever open as a means of evasion we draw attention to it as a major point requiring remedy, otherwise the Films Act can always be defeated. British Shorts. 33. Briefly we may say that British shorts are not forthcoming in sufficient numbers because there is " no money in them." Instead of trying to prop up something which is not economic, we recommend that they be excepted from the operation of the Films Act. In practice as " long " quota has to be obtained when British shorts are not available their absence increases the burden of exhibitors' quota. If, however, the preference is to prop up 82 COMMITTEE ON CINEMATOGRAPH FILMS 26 May, 1936.] Mr. T. H Fligelstone and Mr. W. K. Fdxleb. [< 'ontinued. something uneconomic we are prepared to urge admission of certain classes of short British films for registration as exhibitors' quota. Inelasticity of present Act. 34. We believe that the Cinematograph Films Act is unique in protective legislation in imposing a rigid and ascending scale. It is true that the scale was based upon expectations which seemed reason- able at the time, but which have not been borne out in practice. We submit that in future legis- lative power should, be given to the Board of Trade to vary the quota percentage after due enquiry of the interests affected. If this provision of elasticity is introduced the period of any future legislation is not of very great importance. If a rigid scale is to be introduced in future we sub- mit that regard should be paid to the ever-chang- ing characteristics of this industry and its period should not exceed five years. Section 2. 35. We are aware that a certain amount of evasion ensues but we are satisfied that for all practical purposes this section is of the greatest advantage to the cinematograph trade. We have heard a sug- gestion that declarations may be asked from renters, to which course we should not object, but we shall be quite satisfied if the clause is left as it is. Elimination of Silent Films. 36. Exhibition of silent films has ceased in all commercial dinemas and to prevent silent films being produced for evasion purposes there should be a definition that " sound " British film only shall rank against " sound " foreign film. Trade Shows. 37. Pre-release exhibitions are held complying with Section 32 (b) to which exhibitors are only admitted upon payment for admission. In many cases the opening night is made a special premiere, and it is either not possible to buy tickets or else at ex- orbitant prices. It is suggested that such shows should be con- fined to London and that the renters should be required to invite exhibitors to attend in the same manner as to a trade show. Exhibitors' Licences. (Clause 32— Definition of '• Theatre ".) 38. The Films Act should be extended to include any generally competitive -entertainments of non- flam films within its scope for purposes of registra- tion. Persons exhibiting " non-flam " registered films should also be liable to quota provisions and be registered in respect of their cinemas. It would be unfair that competitive entertainment should be free of the patriotic obligations that attach to the showing of British quota. Television. 39. In view of the fact that television from film is anticipated from a central broadcasting centre doubtless the televising of a film for purposes of public exhibition will be included in any amending legislation. Section 27 (3). 40. In general we would remark that very little advantage arises by the continued retention of (3) (iii) or 3 (iv) in its application to films made in a British studio in ibis country. Tf it is practicable to limit the studio scenes in (3) (ii) to a studio in Great Britain and Northern Ireland we should support such limitation as an effective means of avoiding the production of in- ferior quota; in the Dominions for purposes of (nullifications in this country in due course. 642. (Chairman) : T will not take you right through the memorandum of evidence because we have all read it carefully. Might I ask you to look at para- graph 10 where you analyse the causes of the diffi- culties of exhibitors in complying with the quota requirements. You put the production of " quickies " very high among those difficulties. We have had some figures given us which I understand are avail- able to anyone who cares to compile them from official resources. The figures are in the memor- andum of the Board of Trade in Table L. You have not got this? — (Mr. Fligelstone): We will accept them, my Lord. 643. Those figures show that the British renters produced 65 per cent, of films in the year 1939 which were marked eight or over, whereas United States- controlled renters in the same period produced only 16 per cent, of that quality, so that it would appear, as you say here, that the production of " quickies " is the policy of the United States-controlled renters. You say that the production of usable British films has not made any material increase. Well I have not been able to check that. But is not that largely due to the output of these United States organisa- tions?— Well, my Lord, I think we could quite easily give you the position as we see it in answer to that question which is this : that as an industry the exhibiting section of this industry has very little if anything to complain of the films produced by the British renting companies. Our complaint is of films produced to comply with quota by the foreign rent- ing companies, so we agree with what you have just said. The British films produced to-day by the British companies are standing on their own feet. Our difficulty is with films made by foreign renters simply to comply with quota requirements. 644. You say public opinion in certain areas is resentful of the increasing number of British films. Is that because they are bad? — No, it is one of these things that I cannot explain to you in this regard. Some people like spinach, and others do not. Some districts like British films, and others do not. 645. It is not a matter of "quickies"? — No. British films in certain districts, however good they are, are not acceptable. That is the whole point. 646. Then you say there are not enough British shorts. Is the popularity of the two feature pro- gramme having much effect in decreasing the demand for shorts? — No, I do not think that is the position, because, in my own case I should say that perhaps out of -52 weeks in the year, although I use two long films per programme, I still have to fill up my pro- grammes during, say, 40 weeks with a certain num- ber of shorts. The position is that British shorts are not being made. 647. Are there foreign shorts which could be avail- able if ? — I do not think that is the point, my Lord, because the foreign shorts are available in great numbers and are of excellent quality. 648. Excellent quality? — Yes. comparable to the best long films made. 649. Is there any reason why good quality shorts should not be made in this country ? Is there any particular handicap? — No, except that they are not commercial. We do not pay a great deal of money for shorts. That applies to foreign and British. 6-50. How is it that they are made in the United States? — Because in the United States they have a very different policy from our policy. In the United States in a great number of cases they run one long film only, variety, and short. Well. now. that is not the usual custom in this country. There arc districts where they do run one film only and fill up with shorts, but the majority of places we run on two long films and shorts. Then you do not use the same number of shorts as you would if you had just one long film and shorts. Variety in this country is not in very groat use in ordinary i inline tances. 651. Let us go to paragraphs 15 and 19. You loll us that the choice used to be one out of two, and you bad to take one film out of two as ex- hibitors. I am not quite clear about how it works out, because you say 114 films a year arc shown, MINUTES OF EVIDENCE 83 26 May, 1936.] Mr. T. H. Fligelstone and Mr. W. R. Fuller. [I 'untin ued. good first and varying second feature. That is films above the inferior class? — 114 that are usable. 652. You say the industrial cinema needs a maxi- mum of 40, and taking the average it would seem they have a choice of one in three? — No, because there are three, four, five and six cinemas in each district competing for the films. 653. It really is chiefly a problem in these populous districts where people can reach several cinemas. Is there a big over-production of cinema houses at present, too many cinemas? — Far too many, my Lord. 654. You are anxiously considering the matter? — There are far too many, my Lord, and so long as the public are foolish enough to supply the where- withal for these speculators the building will go on. 655. On the average there is a choice of one in three? — No, my Lord. 1 must make this point very clear. You see in those districts where there is the choice of one in three, that is in districts where there is only one cinema, you find that the cinemas are using a far greater proportion of British films than they do in the populous districts. In the populous districts where you have five cinemas- take Walthamstow, for example, where we have five cinemas. We do not run the same film. Each of those five cinemas runs five different programmes, and so the 114 per annum is divided between the five cinemas. 656. I see. If all bad quality films were jjood would not that meet the difficulty? — It would help considerably, my Lord, especially if the quota is reduced, as we suggest, to 10 per cent. 657. That is a useful road to explore, whether something effective could be done. It is rather difficult to fixl a figure in the abstract. The question is whether we can improve the supply, in which case the figure might be adjusted accord- ingly?— But we must not lose sight of one great point, and that is the one you raised a moment ago. There are districts in this country which are resentful of British films, and it is a very great burden — despite whatever choice there might be in British films — upon the exhibitor in those districts that he should have to show, for 20 per cent, of his year's programme, product that his public do not like. We are all prepared to be patriotic, but you must not drive us too hard. 658. Is it due to block booking? You say the best films are taken by circuits? — That is so. 659. If block booking be broken down, and if the renter could not force bad films upon a reluctant exhibitor ? — That would be the millennium. 660. Why can you not deal with it in the way you deal with blind booking? Why can you not make it an offence to make it a condition that one film shall not be given to an exhibitor unless he takes another? — We should like that very much, but it does not seem practical in the ordinary way of business. 661. I wish you would develop that answer. You are familiar with the difficulties and we are not. Why coidd not that be enforced? — The question of block booking, as you have it here, is not exactly as I believe is understood. Block booking in the past, i.e., prior to the 1927 Act, meant a combina- tion of blind and block booking. 662. Yes? — And that meant each year we Mould be offered a string of titles and book a block, ten. twelve or fifteen films, as the case may be. Th.it does not happen to-day. The film is shown and then booked in a block, and what the renter does is to offer you seven or eight films, and out of the seven or eight perhaps you would like to take five or four. But the renter is not prepared to book you the five or four unless you are prepared to take the eight, and then it becomes a matt"!' of negotiation. 663. I see you benefit to some extent by stopping blind hooking? — Not to some extent, my Lord, but to a great extent. 664. If you could stop block booking as well, you would be very much better off? — Well, that is. of course, covered by the suggestion we placed before you in paragraph 30, the K.R.S. booking policy. 665. Well, you describe the difficulty, but T do not gather that any solution has been given? — The solu- in view is this. It is a question of the strength or weakness of the two parties negotiating. The indi- vidual exhibitor has not got the same chance of putting up a fight in negotiation as a circuit or if he has a number of situations to book for. If I am an independent exhibitor and say to the renter : " No, I am not prepared to book these eight films to get three or four good ones," then the renter might say: " This is only one situation," and leave it at that — but if I represent a circuit or a group of cinemas the position is very different as you will readily appreciate, and that is why the circuit does not have to take the same number of bad films as the independent exhibitor. 666. It is interesting, with regard to the recommendation in paragraph 23 that the quota should be reduced, to notice that the proportion of British films shown is considerably above the quota, which does not look as if on the average there is any insuperable difficulty about complying with it. It is rather difficult to understand why you suggest reduction to 10 per cent, if at the present time, in spite of its only being 20 per cent., 25-5 per cent, is being shown? — That is a point I have to clear up. 667. That it is a matter of taste in different dis- tricts?— Not only that. It is not a matter of the average, for this reason. In those solo districts where there is no competition and where there is a liking for British films, as you can obtain from the figures at the Board of Trade as much as 45 to 50. and even over that percentage of British film is used. But in the populous districts where there are these five to six cinemas competing for film the average is very much less. 668. In paragraph 26 you suggest that you would like to come back to us if we reach any decision as to the scale of renters' quota? — Yes. 669. I must point out the difficulty about that, because it is unusual for Committees to reach any decision as to their recommendations until they have heard the evidence, and I have not the slightest idea what will develop. Once we have reached our opinion, of course, we naturally have to report to the authority that appointed us, and we cannot begin recalling people when we have come to the end of our evidence. I hope you will under- stand it is not from any discourtesy, but from a necessity of the case that we must ask witnesses to state the case to the full when they come to us, and we have to form our opinions on that? — We have put that in so that we might not appear dis- courteous if, after you have arrived at your de- cisions on grounds which we do not think are advantageous or fair to the industry, we find that we must proceed further in this matter. 670. Then the responsibility is on the Board of Trade?— Yes. 671. They clearly have to examine it over again. But I am afraid we cannot look on any evidence as conditional on a particular decision ?— No, we quite appreciate that. 672. I wanted to make that clear? — If I might suggest, this is my own personal opinion and nut the opinion of the Association. 673. We quite appreciate we may consult you again if wTe think there is anything which makes it necessary. You put the cost of a good film a good deal higher than some other authorities. You put it at £25,000 to £30,000 at least. Any high figure would have the unfortunate effect of knocking out the small producers, but a lower figure which would yet be much beyond what they are spending at the present time would not have this effeci of knocking out small film producers. You do not want to kei p the " quickie " producer, even though he is small? — 36152 L 2 84 COMMITTEE ON CINEMATOGRAPH FILMS 26 May, 1936.] Mr. T. H. Fligelstone and Mr. W. R. Fuller. [Cunt in ued. What we are really concerned with are the firms that are endeavouring to make good films. The difference is this, that when one of these small producers, to whom we have referred in our memo- randum, makes a film, he makes it knowing that he has to sell it and make a profit out of it. Those are the people we want to retain, but firms making quota films for foreign companies for the only pur- pose of complying with their quota requirements, we would just as well see out as in. They are no advantage to the exhibitor. 674. Here again I am speaking for myself, and going by evidence we have heard. I take it no one would suggest the cost basis should be rigid and final. Clearly you .would risk great in- justice unless you had some power of appeal for a really good film ? — What you mean to say is that if a film costs £5,000 and it has a special merit that it should not be debarred from quota be- cause it did not cost £2 per foot, and a committee would be set up to decide this? 675. It would be a much smaller matter for them to decide than if they had to see every film. If the general production could be automatically tested on cost basis? — I would like to make this sugges- tion about any difficulty that this Committee might experience. We, the exhibitors, feel very strongly on this question. We want to see good British films and a very fine British industry set up, and we do not think any trouble that might be occasioned to five or six people in viewing films should be taken into consideration. The question is of such great and vital importance that, if five or six people have to sacrifice time in viewing all British films, that is not too much to ask. 676. If they have to see all the films they would have to be a paid Committee, the volume of work would be much too great for any other method. It would also be very difficult to get any Committee which would command universal support. It is a much smaller matter if you only view the ex- ception ? — We would rather view the exception than the rule in this case. We think it is so serious. 677. In paragraph 29, it would be difficult to apply a cost test to British films produced in the Dominions. Is it not a fact that Form O basis is applied to them without any suggestion it is unfairly operated? — I do not know what the Form C basis is. 678. It is the qualification for British films ; certain elements of cost are excluded and certain other elements computed, and it is set out in Form C. We are familiar in this Committee with Form C. Tha only point on Form C at this moment is that it is a matter of certain analysed costs and, if that can be applied on the certificate of reputable bodies in the Dominions, ought there to be any difficulty about applying the cost basis generally to the Dominions? — Yes, we feel that it is going to be very difficult to apply a cost basis to either the films produced in this country or in the Dominions. 679. Could you develop that? — Yes, that is not difficult. Take the question of ordinary floor space, by the time it has passed through three different companies, the cost may be considerably increased. 680. That is the kind of case which no doubt is the reason that Form C was adopted. Form C eliminates those difficulties. It only includes wages and salaries, and, of course, you could get a figure to correspond with whatever was considered reason- able for a total expenditure to be the test for the expenditure on wages and salaries, and it seems to me that on those lines there ought to be no more difficulty with the Dominions than there is at the present time? — The whole cost would be based on wages and salary, nothing taken in for production, or electricity, or studio space? 681. Form C takes account of wages and salaries, which are, on the average, approximately 50 per cent, of total cost of production of films. So if the film costs £2 per foot, £1 per foot can be said to be wages and salaries. It has been applied to films from the Dominions and I understand can be applied without serious difficulty. In paragraph 33 you would like the admission of certain classes — which of the excluded classes? — We do not want it. 682. I know you do not want it? — At present there is no money in British shorts. If to salve your conscience, or for some reason unknown to us you still wish to include the British shorts and to prop up something that is uneconomic, ,we say, as exhibitors, wTe must not be burdened by having to secure long British films to compensate for the foreign shorts we use when you are not able to come forward with at least the corresponding 20 per cent, of British shorts. If you insist on prop- ping up British shorts, then we suggest that news reels, cine-magazines, Pathetone. and that type of short, should be allowed for exhibitors' quota. 683. You have no special class of short in mind when you mention certain classes which might be used? — Yes, those just mentioned. 684. They have exhibitors' quota now? — No, they have not. They do not rank. 685. In certain cases, if there is special exhibition value. Then in paragraph 37, I do not know if this question about trade shows is of any importance to you. J understand in London they very often are for charity? — The point is this. It has become a habit these days for the renter to throw a very fine premiere, and invite the whole of society there, whilst excluding the members of the trade, and make the members of the trade pay their guinea or two guineas for tickets, or else not admit them. 686. Therefore the trade show need not be free? — Need not be at the moment. 587. What is the normal procedure. Do they generally make a charge ? — They are divided into two classes. (1) Film premieres (usually for charity), where a charge of anything up to five guineas a seat is made. (2) Special trade shows to which the exhibitor is invited. Certain renters who run these premieres do not invite members of the trade to see the film during its West End run. 688. Do the small exhibitors find much difficulty in seeing these trade shows? — They find a little difficulty, and that is why it has been put in. 689. In the following paragraph you wish to bring in the " non-flam " film? — Yes, my Lord. 690. Is this a big element at the present time? — Well, it is growing, and it is becoming very serious. 691. They are 16 mm.?— Yes. 692. The " non-flam " is the type that can be shown in the hall without the special fire require- ment?— That is it. 693. What you say is limited to 16 mm. ? — Yes. 694. Are these commercially shown, or are they shown in the village institute, and that sort of thing? — Well, they are charitable, my Lord, but the object is to make a profit. If I might suggest, we would be very satisfied that those shows which comply with the requirement of the Customs and Excise for exemption of Entertainment Tax should be excluded; but those shows that would not comply with the requiremeTits of the Customs and Excise for exemption of Entertainment Tax, we say should come in with us and be as patriotic as we arc and run their quota as we do. 695. I suppose it is arithmetically impossible to work the quota out, if it is an isolated show? — They are not isolated. They are growing, and be? coming competitive. 696. (Mr. Holmes): Will you tell us the reason why some districts arc inimical to British films? You mention Scotland and parts of London, can you give any reason for that? — I cannot give you •any reason. I have a cinema at Walthamstow and I have a cinema at Watford. Now during the same week T show the same film at Walthamstow , it is successful. At Watford it fails or vice versa. (Mr. Fuller) : We submitted some experiences eighteen MINUTES OF EVIDENCE 85 26 May, 1936.] Mr. T. H. Fligelstone and Mr. W. R. Fuller. [Continued. months ago when we saw the Board of Trade and we brought one or two people. It is amazing to see their figures, and taking all the grades of programme you see their takings ranging from £400 to £600 a week. Every time a British film comes in there is a drop of £150 a .week. 697. {Mr. Cameron) : Are these working class areas, or middle-class areas? — More working class areas. 698. {Mr. Holmes) : I want you to assume the renters' quota is done away with, and that block booking is done away with, and so far as the exhibitors are concerned they have free trade in films. They can choose whatever they like, main- taining a quota of x per cent, of British films. I want to ask you first whether you think that will not encourage the making of good British films, and the abolition of the bad quickies? — {Mr. Fligelstone) : Might I ask if you are suggesting in simple language that a quota should be retained upon the exhibitor and no quota upon the renter? 699. Yes? — I think that is a very wonderful sug- gestion— for the American renter. What would happen if that were done would be that the American renter would be entirely satisfied with the quota and would say to himself " Well that is so much loss per annum or so much expenditure per annum washed out." We are fairly satisfied with the product from the British companies. It is the American companies with whom we are concerned. Furthermore, I understand in protective legislation the first thing the Government does is to protect the consumer and not place him at the mercy of the manufacturer, which is what I suggest would happen. We have been exploited as it is, but that would be nothing compared with the manner in which we should be exploited if there were a quota only on the exhibitor. 700. We have been told that the American renter, in order to fulfil his quota, gets a very cheap British film which lowers the prestige of the British film maker. Is that correct? — Well, I think in the main without a lot of explanation I should say " yes ". 701. If, therefore, the American renter is not re- quired to trouble at all about British films, those cheap, poor British films will not be made. It will, therefore, encourage the British maker who wants to make a good film to make a good film, because he will be able to put those on the market, the exhibitor will be able to take them as part of his quota, and the competition of the cheap American " quickie " — British " quickie " made by the Americans to fulfil their quota — will disappear? — {Mr. Fuller) : Why will he be encouraged to make good ones? One can understand his being encouraged to make films as fast as he can, but why should he be encouraged to make good ones? 702. The exhibitor will have to take so many British films. If British producers know that this quota must be taken by exhibitors they will en- deavour to make good films because, as you are not going to have block booking any longer (mind I am still talking with the abolition of block booking in mind) there will be a free opportunity on the part of every exhibitor to choose for himself whatever British films he likes. — {Mr. Fligelstone) : What guarantee have we that there will be this urge on the part of the British manufacturer to make good films? There appears to be a misguided opinion about this industry that there is a wish on the part of the producers to make greater and better films. We have not found that. What we have found is the wish to make money in this business, and I put it to you this way as a thinking man. I know that if I were a British manufacturer in those circum- stances I would immediately get hold of the British manufacturers and form such a ring that there would be no choice or margin of selection for the British exhibitor. He would have so much, and so much, and he would have to take it whether he liked it or not, and to pay what was demanded whether he liked it or not. 703. Under the renters' quota at the present time your exhibitors have to take so many British films per annum, but in order to get your American films you are compelled to take so much of that quota from the Americans in block booking? — That is not so. We are compelled to take the bad quota because there is no good quota. 704. Are we to understand that no American renter ever says to an exhibitor in this country, " We will only let you have this American film of ours if you take A, B and 0 of our British films " ? — If you ask me personally, I cannot speak for the whole trade because I do not know how they negotiate, but if you ask me personally that does not happen with me. I will make a definite state- ment so far as 1 am concerned. I cannot speak for the trade because I am not in their offices when these negotiations take place, but I have never had that put to me. 705. You have never had to take any British film with an American film compulsorily ? — In the ordi- nary course of events the salesman has to sell his English quota and not all American films are good, but they do not come with a pistol to your head and say, " Take so-and-so ". 706. You have to take eight films together, and are they not British films? — Not necessarily. 707. How does the renter fulfil his quota at the present time?— He is in a different position from the exhibitor. The exhibitor has to show. The renter has practically only got to acquire. 708. Does not the renter have to sell so many British films for every foreign film?— If I may sug- gest it, Mr. Patterson could answer that even better than I can. {Mr. Patterson): The position of the renter is that he has to acquire for the purpose of renting to exhibitors a certain proportion of British films. The Board of Trade examine the renter's returns to see whether he has rented those films to exhibitors. 709. {Mr. Holmes) : We have been informed the reason why so many bad British pictures are on the market is because the American renter, in order to fulfil his quota, buys these cheaply and passes them on together with his good American films to an exhibitor and so the prestige of the British film making industry has suffered, and you say that is not correct?— I have said that is my personal experience. I cannot speak for the whole country. I have not consulted them. {Mr. Fuller) : You can generalise a little more to this extent. In a booking, a man will pay a percentage for his complete pro- gramme. Your second feature, which is one of these rubbishy quota " quickies," if a renter has one of those on hand he may put it against his good American film, and as you have to show so much footage that will in due course be shown. In some highly competitive districts the salesman will use every device possible and say " You had better take the 'quickies'," for the purpose of getting the number of bookings to be submitted to the Board of Trade in due course. 710. Are you in favour of block booking?— No, we are not in favour of block booking. 711. {Chairman) : You think your solution in paragraph :;l is workable. You cannot let every- body show the film at the same time, and the prefer- ence of one over the other is inevitable. 712. {The Hon. Eleanor Plumer): Does the barring clause come in now? — Yes. 713. {Chairman): Barring clauses involve this discrimination. This looks wonderful if you could do it? — You could do it to-morrow. The Kine- matograph Renters' Society will not let you pool your bookings if you are individuals. What is likely to happen to-morrow is that you would get perhaps five to six competitive groups, but they would all bargain, they would do a much more suitable bargain with the renters than bhey can do as individuals. 714. And the give ami take would come within the group. Would not that involve very great 86 COMMITTEE ON CINEMATOGRAPH FILMS 26 May, 1936.] Mr. T. H. Fligelstone and Mr. W. R. Fuller. [Continued. difficulty in adjustment? — The group can look after all that. 715. It would equally cause an advantage to the big man, and a grievance to the small man? — The small man could always get on to a group. 716. (The Hon. Eleanor Plumer) : Could he? Would he be taken? — Yes. 717. {Mr. Holmes) : If the renters' quota was abolished, and block booking was abolished, would not the American renter give up British films alto- gether and only devote himself to his own films? — (Mr. Fligelstone) : I think most of them would. 718. That would give a greater opportunity to a renter devoting himself entirely to British films? — We already have our British renting firms which are doing very well. 719. But this would stimulate them, and they would have more business to do? — What you do not appreciate is if you do not insist upon the goods being made there is no guarantee that they will be made. 720. You are going too fast for me. At the present time the renter who is dealing in British films has to stand the competition of the American renter who is also selling British films. If the American renter gives up the selling of British films, the British renter will have a bigger market in which to sell the goods that he deals in? — He will have less comrjetition. 721. He will have less competition and the chance of doing greater business and making greater profits. Therefore, it will be to his interest to en- deavour to stimulate the British producer to supply good films so as to give him the opportunity of doing a bigger trade? — What it will do will be to give him an assured market with less competition and greater possibilities for exploitation. 722. Would not the very fact that a certain portion of the renters' trade at the moment would be dis- appearing, I mean by that, the American renter would be giving up British films, would not that have the effect of bringing other people into the renter business dealing only in British films, and would not they in their turn stimulate British pro- ducers to produce British films? — No, definitely not. 723. That is a matter of opinion. I am suggesting to you something that always happens in any trade, and not in cinemas ? — I say it is a matter of fact and you say it is a matter of opinion. I say it is a matter of fact ; if what you say is correct why is there not a greater number of English productions made now by British companies? 724. If we have changed places, then I will answer what I think is the answer. Because under the quota system the foreign renter has to acquire a certain number of British films, and in order to fulfil that requirement he gets them made as cheaply and badly as he possibly can, and if he were no longer com- pelled to do that it would give the opportunity for British renters to get better films and for British firms to be encouraged to make them. We have changed places, but that is my answer? — My answer to you is in your own words ; you say the American renter is already eliminated, because you say he acquires and makes such bad British films that they are unbookable. 725. No, I say he is able by the block booking system to force them with his good American films on to the exhibitors? — Which is not a fact. 726. But in the view of other people is the case? — That is not general. 727. It is not true in your case? — It is not general. (Mr. Fuller): Ten years ago I was very much occu- pied with this, and Sir Philip Cunliffe-Lister made it \ cry plain that any scheme must prevent exploita- tion of exhibitors and therefore the machinery in this was very deliberately chosen that first of all you would assure the supply, and it went even further than it does to-day. You not only assured the supply but assured two films from winch you could select one, and I do not know of any pro- tective legislation where there is not some corre- sponding safeguard either to assure supply or to protect the user on price. 728. You appreciate that we are just trying to explore this matter and get everybody's ideas with regard to it? — But do you know anything which does not protect the user, any kind of protective legislation which does not protect the user on price from exploitation ? 729. I am not suggesting for a moment that we should not protect the user in this case ? — Then you come up against the next trouble which is if you do not leave the film to find its own price by the natural order of supply and demand, if you protect us on the ground of price that we should want to pay. you may automatically restrict jour production to an inferior article. 730. Yes, I will take that into account? — Quota is a particular form of protective legislation, and I believe in most of the other quotas they always assure the supply from which the user can make his selection by guaranteeing the producer a price and that is usually fixed in conjunction with the user so that it has some economic bearing on the thing. That can apply to an article which has a fixed standard of value, and you get into terrible difficulties once you try to fix a price for an article of enter- tainment which has no fixed value like a piece of steel or something of that sort. 731. (Sir Arnold Wilson): I will tak-~ you back to the first paragraph, " membership of the Cinemato- graph Exhibitors' Association." What are these surplus places of entertainment, not included in your membership? — Roughly places open one night a week ; places occasionally open less than six nights a week. 732. How many are there of that type? — You have all the information in the Board of Trade. Roughly, I suppose there may be, at any time, about 200 cinemas which have a licence, closed, who would be out of membership with us, or in process of some change, all round the country, and two to three hundred places open Saturday night. 733. What is the basis of membership. What is the charge? — It varies according to seating capacity. It ranges from two guineas to twenty guineas. 734. Per hundred seats? — It is on the holding capacity. The small cinema with a full house which would not exceed £12 10s. is two guineas. £25 is five guineas. £150 is ten guineas, and above that twenty guineas. 735. Under the title " Effects of Cinematograph Film Act," in paragraph 2, you say that there is general agreement. I should like to know how com- plete the general agreement is here. You purport to represent all exhibitors, both circuit and inde- pendent, and your evidence shows they often clash. How far is that general agreement real or tem- porary for the purpose of submitting evidence? — (Mr. Fligelstone) : It is very real ; this is a matter that has been before the members of the Association for the past three or four years. Evidence has been collected during the whole of that time, and this is absolutely a unanimous case that is being put before you. 736. Would it be true to say that in your deliberations generally the members of circuits dominate discussions as against the independents? — No, the reverse. 737. You go on to quote the Board of Trade return which states that 26 per cent, of British films were shown in 1934. 1 suppose yon mean 26 per cent, of the total of films shown by exhibitors were British? — Yes. 738. But in a footnote you say it is understood the figures for 1935 are substantially the same as those for 1931. In view of the acknowledged im- provement and the quality of British film produc- tion during the past year I should have expected to find an increase in the percentage of British films shown during the last period. What is your MINUTES OF EVIDENCE 87 26 May, 1936.] Mr. T. H. Fligelstone and Mr. W. R. Fuller. [( Continued. explanation for the figure remaining constant? — First of all I would like to know where the decided improvement has taken place. 739. It has been given before us in evidence? — By the exhibitors? 740. No, not by the exhibitors. You do not think there has been improvement in British films? — I should think it is static, would you not think so, Mr. Fuller?— (Mr. Fuller): Yes. We work on a figure of 125 British films for the last two or three years. If you were talking as an exhibitor, figuring in your mind what will be usable films during the coming year, a figure of round about 125 represents the usable films. 741. There has been really no improvement in the last year? — (Mr. Fligelstone): I would like to qualify that a little, there has been an improvement in one or two films. 742. How far was the 1934 improvement due to a possible shortage of the good American product? — I should say the American product was also static. I mean other than the ordinary process of films getting 'better or a little worse, but on the whole it is about the same. (Mr. Fuller) : I think we can show some improvement has taken place without affecting things very much. I think in the period to 30th September, 1934, you could content the public very well with a British film which was cost- ing £12,000 to £20,000. In this last year or so the standard of money that you generally have to spend has definitely gone up into the region of £25,000 to £40,000. That is the measure of improvement which anybody going to the cinema would notice without knowing the reasons why it has happened. 743. In paragraph 5 you urge it is in the public interest that the production of poor British films should be eliminated. How far do you, the ex- hibitors, feel you can contribute towards the elimi- nation of the bad British product; can you? — (Mr. Fligelstone) : We can contribute to that by showing less British films. 744. What steps have you taken to encourage the better British product in the past? — We are the consumer, not the producer. 745. You are the middle man, are you not? — No. 746. In a sense you are really the middle man?— No. The middle man, I would suggest, is the renter. I should say the producer, the manufac- turer, is the first, the man that sells the goods is the second, and we deliver the goods to the public. 747. I am regarding the consumer as the public who pays for the article and you as the retailer? — Well, that is not a true description of the position. 748. It is not a true analogy? — No, the public is the patron. 749. And you do not think it has been in your power to take any steps to encourage better British production? — It definitely is not in our power to improve production. We are not the manufacturers neither are we the renters. We can only use the goods that are delivered. 750. I am under the impression that the increase in the last two or three years with new cinemas has been almost entirely the larger circuits, not independents who get money locally? — (Mr. Fligel- stone) : I think that this is a matter that we should try and explain to you. (Mr. Fuller): These were our figures of last year. " An examination of the new membership of the Association indicates that 111 new cinemas have been opened in 1935. Of this number 19 replaced cinemas that are closed, so that the net increase is 92, of which 27 are owned by circuits and 65 by independents ". That was the analysis we reported for last year. 751. I cannot see that that is public money? — (Mr. Fligelstone) : Well, you cannot see that it is public money, but what happens in certain cases is this. A man comes along to a town or a man is in a town, he does not make a public issue, if that is what you mean. Do you mean public issue P 752. Yes? — But there are means of obtaining; money from the public without a public? issue. He gets his plot of ground, he gets his littli> company together, and he gets all the local people putting up their money. That is what transpires, but they contract big issues. 753. Is it not possible that a cinema loses some- thing of its immediate competitive purpose and value when it becomes part of a circuit and is acquired as part of a real estate deal? — I do not think so. 754. Is it the practice of certain circuits to finance their new" acquisitions with local money, apart from the independent whom you referred to as picking up local money? — Well, I do not quite know where all this is leading to. 755. Well, it is really arising from your reference to the growth of circuits and your immediate refer- ence to the public putting up funds. I am asking how far that is being put up by and for inde- pendents and how far it is being done actually by the circuits who are getting in local small 'money. — (Mr. Fuller) : We have given yon* the analysis for last year. 756. Yes, but those 27, I think that .was the number, were circuits? — -Yes. 757. Taking your figures in paragraph 6 for a moment; nine circuits between them controlled 652 first run cinemas, which represented about half the first run situations, which in turn dominated the booking situation, which means that the taste of a very large percentage of the British film-going public was, in fact, dictated by the booking managers of those nine circuits. Do you consider that to be a healthy state of affairs either for the public or for the British film industry ?— (Mr. Fuller): We do not find that we can ever adopt the role of dictators in our business. We are absolutely the servants of the public. We can put before them what some- one might think they ought to have, but the public is never under any obligation to pay for it; unless they continue to come to our cinemas we cannot keep our industry going, so that there is nothing of the dictator element there. 758. But in fact the circuits are somewhat in the same position as chain stores in that it pays them better to have a few standard products com- mon to all their branches rather than to specialise on the public's taste which might vary from one part of England to another? — No, Sir, there is nothing standard about the entertainment business, and there is nothing standard in the public taste. It is difficult enough to anticipate what the public taste will be, it is difficult enough to keep pace with it when you think you have gauged it. Actually production is now on a very high level and has been of an extraordinarily high standard in its range of subjects during the last year or two, and exhibitors make the best selection from what is produced which they think will appeal to the public. In the course of their experience they get a considerable amount of ability in gauging what the public is likely to want, hut if they make mis- takes they pay very handsomely for it. and they endeavour not to make more than ono mistake if they can help it. 759. Is it the fact that the less powerful ex- hibitors who cater for what is left of the British public find it difficult to compete with their stronger brethren by being unable to get the best pro- ducts?— That obviously follows. 760. So that, in fact, there is a certain dictation involved in the mere fact that certain areas are in strong hands and powerful hands and other areas are quite content to reduce the quality available in those areas where the more powerful companies are not represented ? No, it does not mean that at all. Actually what the selection of films does is to enable you to get the people in that area into your cinema if you have the power to book against someone who has not the booking power. The public is not deprived of a sight of tho films, what we are 88 COMMITTEE ON CINEMATOGRAPH FILMS 26 May, 1936.] Mr. T. H. Fligelstonb and Mr. W. R. Fuller. [Continued. concerned with is the rewards that you get for your labours. Where the stronger people are not. the same films are shown because the lesser people can get them, there is nothing to prevent them doing so. 761. I will turn to paragraph 7. You say that the exhibitors have more than fulfilled their statu- tory obligation. I gathered from the figures that the vast proportion have just fulfilled their statu- tory obligation as near mathematically as possible. The balance have presumably exceeded their quota requirements because they find it is profitable. Have they any other reason for doing so!' Should they have any other reason for doing so? — (Mr. Fligel- stone) : Well, the only point is that it is somewhat difficult for the exhibitor to compute within one per cent, or two per cent, the amount of film that he requires. 762. I agree? — And naturally as a body we are anxious to be law-abiding citizens and sometimes we err on the side of caution, being one per cent. or two per cent, over rather than take the risk of having the exact quota. It is very difficult to compute, and the mass of our members are not altogether mathematicians, plus the fact, as I said previously, that in certain towns and districts where there is not excessive competition, where British prodtiction is liked, they do run an excessive amount of the British product. 763. On commercial grounds? — Definitely on commercial grounds. 764. That is to say your loyal support of the Films Act amounts to this — that you have refrained from breaking the law? — Our loyal support of the Films Act is that a great many of our members have not broken the law at considerable expense to them- selves. 765. Because they would be prosecuted if they did not? — Not only that, but also at great effort, be- cause I can assure you seeing, as I have to do, the quantity of bad films, it is a very great effort. 766. Bad films made by American companies in Great Britain? — I did not say that. 767. I am asking you. — I would say bad American films and particularly bad British films. 768. You refer in rather diffident language to the question of protective legislation upon apparatus and equipment. That is not really within the scope of this Committee, but can you say what percentage of sound projection heads used in British cinemas are of American origin and how far British? — Do you mean manufactured in this country ? 769. Yes? — I do not know whether Western Elec- tric manufacture here, do they? — (Mr. Fuller): They are understood to do a little. I think as a generality more than half the number of installations are of American origin. 770. It has been suggested to me that exhibitors have not been in all respects fairly treated by manufacturers — I make no distinction between British and foreign — in the matter of service charges, replacements, and the like? — An American company quite definitely charges more than the British. 771. So that whilst you have in your own case paid a little more to secure the right article yen have occasionally got over-charged, when you have had it, by subsequent service charges? — Yes, but it is not on account of the protective duty, that is on account of the patent law. 772. That is arising from the operation of patent laws? — Yes. 773. Although this is not strictly within our terms of reference I should like as you have men- tioned it to hear a little more on the subject, because the patent law of this country is intended to secure the working of the manufacturer in this country under licence?— (Mr. Fligelstone) : ! think I might help yen a little. You are speaking now of the talking equipment mere than anything else? 774. Yes?— Going back to the very early days the best talking set that we had the opportunity of securing was the Western Electric and the K.C.A., both American companies. The British talking sets were then indifferent. Furthermore when the talking phase took place there was a rush on the part of the exhibitor to get a talking set. and many of us signed these documents without thinking or realising what we were signing, in consequence of which a service charge which we regard as excessive is still being imposed upon us and we have no alternative other than to say " Take the set out and we will put in a British one " which would mean a loss of our investment and the expenditure of a further capital sum. 775. Are you taking steps as a body to ensure that this sort of thing will not occur again? — As a body we keep on making representations to this particular company. 776. You have not protested to the Board of Trade? — No. (Mr. Fuller) : We are bound by a signed con- tract for ten years, and I think most of them have about three more years to go. We are keeping up a steady protest; we have got a certain very small number of reductions as a result of that protest. We advise our members to hold their hands and not to sign again, and when the end of the ten years comes we shall say we are not going to stand for these high charges. 777. Thank you. You refer in paragraph 9 to ex- ploitation:— "exhibitors would be liable to detri- mental exploitation by producers." But do you think that certain producers might justifiably put up the same complaint and suggest that on occasions in the past they have been exploited by exhibitors to the detriment of British film production? — (Mr. Fligel- stone) : You refer to quota legislation. 778. Yes?— (Mr. Fuller): Yes. they have in the past voiced complaints of some of +he circuits. 779. There have been complaints? — Yes, I do not think they have ever been of the independent exhibitor. 780. No, I am speaking of the circuits? — Yes. 781. I will turn now to paragraph 10. What steps during 1931 and 1932 did the exhibitors take, although their quota was much less then, to counter- act this deplorable policy of the American renters? — (Mr. Fligelstone): I think we appealed to the Board of Trade on one or two occasions. You see, it is not an obligation upon us to do the job of the producer. The producer is protected, the obligation is on the renter to take his films, and the obligation is upon us to show. 782. I did not know that you had, in fact, made representations to the Board of Trade, but you were, in your opinion, doing your best then to arouse the official mind? — On how many occasions. Mr. Fuller, have we been to the Board of Trade? We have been twice, I think. (Mr. Fulh i ) : We have been twice. I found some notes which I had drafted in 1931. dealing with certain aspects, but the general rule of life, we find, is that nothing gets dealt with until it becomes a hardship. 783. Referring to paragraph 10 (2), what were the figures of registration of short films during those last three years? — I do not know. (Mr. Fligelstone) ; In 1930 there were 351 produced, and now there are only 131 produced, and what are 131 for what is required ? 784. What percentage of each category of long and short films were considered usable during this period? — Well, of the long films we suggest that there were 116 to 125. 785. That is a little more than half, two-thirds you might say were usable of the long films. What pro- portion of the short films were usable? — (Mr. Fuller) : There is nothing much in differentiating between shorts. 786. In paragraph 10 (3), what are the particular parts of Scotland and the particular parts of London? Can you name them? It is a matter of considerable importance? — (Mr. Fligelstone): No, I do not think wo could name them. MINUTES OF EVIDENCE 89 26 May, 1936.] Mr. T. H. Fligelstone and Mr. W. R. Fuller. {Continued. 787. Would it not be right to say that the only part of Scotland is Glasgow and neighbourhood? — No, practically all our Scottish members complain. (Mr. Fuller) : And I think it is admitted by the British producers that they have difficulties there. 788. The Scots have a natural preference for foreign made films? — (Mr. Fligelstone) : They have a natural resentment to British films, let us put it in that way. 789. What parts of London ?— (Mr. Fuller) : The East End is one. 790. Whitechapel ?— Yes. 791. Stepney, Limehouse, Mile End?— (Mr. Fligel- stone): Yes, and Walthamstow and Leyton. 792. And Hackney?— Yes. (Mr. Fuller) : There are one or two other parts, but I am not sure which they are, where they do not go. 793. Clapton? — Practically all the industrial poorer neighbourhoods of London they are not liked. 794. How far would it be right to say that it is the foreign and Jewish elements in these parts of London which are mainly responsible for that par- ticular feeling? — That is not so. I have a theatre at Walthamstow. I believe that the population at Walthamstow is practically 99 per cent. non-Jewish; and they resent British films there. 795. Is it fairly accurate to say that most Jews in all branches of the film industry here and abroad trace their origin to a common mid-iEuropean bloc, and they have a natural antipathy to the British outlook as represented in the films? — (Mr. Fuller): No, the British films, a good many of them," are produced by those people. 796. It has been alleged to us in evidence that there has been a tendency of certain elements in this country, alien elements, deliberately to go to West End theatres and to barrack British films as such? — (Mr. Fligelstone) : Well, I think, my Lord, that this matter should be cleared up definitely. The proportion of the Jewish population of London is very small. 797. How many? — I cannot give you the exact figure, but it must be very little. How many thousand Jews are there in the country altogether? 798. There are about 370,000, I think, in London alone? — And what is 370,000 amongst the popula- tion of London, and as I have told you, in my own theatre in Walthamstow, where there are no Jews present, there is still the same antipathy. I do not agree that there is any section of this country who go to cinemas to barrack films or to make a fuss. They just do not like British films. 799. To what extent is the prejudice shown against the British film made by the American companies as against the British film made by the British companies? — Nil. If I may say so, when the public see a British film they do not know whether it is made by a British company or an American company, they just go in the same way, as I might suggest you and I do, to see these films. I see these " credit titles," but I do not remember the names of the cameramen, scenario writers or other technicians, and I see film after film. 800. In paragraph 10 (4) do you mean that the good British shorts are not produced in sufficient numbers? — All British shorts are not produced in sufficient numbers. 801. Could not exhibitors have given more encouragement to the producers of documentary interest films to make up for this shortage? — So far as the documentary film is concerned — are you coming on to the documentary film? 802. I am dealing with it, it is not mentioned in your evidence, but it is a short film? — Well, I am not quite certain what the documentary film is. I happened to hear Mr. Guedella the other day giving a definition of a documentary film; he said, "if machinery was photographed upside clown that would be a documentary film," but all we come in contact with is entertainment, and we do not say : 36452 " Is this educational, is this documentary, or is this scenic "? It is just what we see and how is it going to take? 803. You have read Paul Rotha's book " Docu- mentary " ? — I have not. 804. That would give you a fairly good definition of the word? — I will make a note of that. 805. I am thinking of the film " Shipyard," for example, or films like " The Drifters " ?— And " The Voice of Britain." 800. Yes ? — Let me tell you what happened to a film of this kind. I saw such a film myself, and I said to myself, " This is not a bad British film and if it was cut down to about half I would book it." Well, it was booked against me fortunately, and the experience that the opposition had who played it was unfortunate. The public would not have it and will not have it, and I believe that happened right throughout the country; and, furthermore, I believe that the Association in their Report gave very good marks to that film. What I am getting at is this, the public come into our cinemas to be amused, not educated. If their amusement can be so guided that it is educational, that is all right, but they will not come in to be educated, and that goes back to the time when I handled myself a series of films called " Marvels of the Universe." That is going back perhaps ten or fifteen years ago, and still they will not have educational films as such. 807. Will you carry your mind back to the Empire Marketing Board days? — Yes. 808. Did you have any success with their films? — No. 809. Will you carry your mind back to " Drifters", the " Post Office " and the like, did you get any change out of them? — No. (Mr. Fuller): "Drifters", I think, is the only one of those that did any good. No documentary film, in order to get it in its right aspect, has ever set the Thames on fire. I spent a week- end looking through to see what the results were of something I said to our viewers. We have a number of viewers who produce a full report each week, and that is sent to our members, and I think it is accepted everywhere as more or less a standard report. Well, I think about twelve months ago I said to our viewers, who were constantly bringing to me various invitations to attend educational films, " You had better cover all these things in future and treat them all kindly ", as most of them were dealt with by the small firms, and I spent this week-end looking through the results of last year, and with the kindest of treatment they are a very, very ordinary lot from an entertainment point of view. (Mr. Fligelstone) : From an entertainment point of view, we do not say from an educational point of view. (.1/;-. Fuller) : I believe you can say from the educa- tional point of view. We do not want to discuss the affairs of the British Film Institute here, but we have looked at them very closely on the educational side, and I do not want anybody to think we are opposed to them, because it has been the exact opposite. When you look through them there is very little which you can take hold of, they are a bunch of half and halfers, they are not good education and they are not good entertainment. I think that sums them up 810. In sub-paragraph (4) of paragraph 10 you re- ferred to long British films. Do you mean full length first or second features as opposed to supers? — (Mr. Fligelstone) : No, just long British films. 811. Is it not a fact that there are a good many exhibitors in the circuits who woidd prefer to bill an American second feature above a British first feature even on equal quality? — In those districts where the public resent British films definitely yes, but nor- mally the exhibitor will display his most attractive goods, in the same way as the grocer or the green- grocer displays his best goods in the window. The exhibitor docs exactly the same. We have got to attract the public into our cinemas and we put on top what we think is the best attraction. M 90 COMMITTEE ON CINEMATOGRAPH FILMS 26 May, 1936.] Mr. T. H. Fligelstone and Mr. W. R. Fuller. [Continued. 812. You mentioned in paragraph 10 (4) that the necessity of acquiring long British films increases a 20 per cent, quota to about 24 per cent. ? — Yes, definitely. I can tell you myself, I can only speak as I find it, that when I show a British film it costs me money. 813. But so far as you are concerned the majority of exhibitors do not care and cannot afford to care twopence where a film comes from, their business is to get people to the box office? — To eniertain the public, but at the same time they are anxious to have a British film industry. 814. But their only real interest in the British film industry is a question of quota? — No, I think there is a genuine desire on the part of exhibiting members in this country to have British films, and they are prepared to make certain sacrifices for it. 815. Now, in paragraph 11 : can you, if necessary, post figures to Mr. Patterson afterwards, comparing the American releases in the same categories? — Yes.* 816. They would be of some value to us as a com- parison?— Yes. 817. Good first features — in the same categories as you have got here. Paragraphs 12 and 13, would you say that this was a deliberate extension of the pernicious policy adopted by certain American renters and already referred to? — What I would suggest is — you mean the acquiring of bad British films ? 818. Where you say that the extra twenty were of such poor quality? — Some of this twenty may have been amongst the English companies, not necessarily the American companies. 819. And are certain of your members allied in one way or another to these very American renting com- panies?— To the American renting companies, no, I do not think so. (Mr. Fuller) : No, I do not think there are more than about twenty or thirty cinemas in this country tied to American principals. 820. How many of these 64 films were made or caused to be f'made by American; renters? — (Mr. Fligelstone) : I should say a considerable quantity. 821. Do you feel confident that the public would have endorsed 100 per cent, your statement that these 64 films would never have been booked by exhibitors with a free choice? — (Mr. Fligelstone): There is no question about that, it is definite. 822. Do you recognise the possibility that amongst the American films shown during 1935 there may have been quite an appreciable number which would never have been booked equally by a public having a free choice? — Definitely. 823. So that you are not as free as you would wish to be? — Well, that is not quite the point. You see, we see a film when it is trade shown to us and we say to oureslves, " Well, that is a good film, the public will like it," but when it comes to the acid test of the public paying money over the box office the public say, " We do not like that film and we shall not go in to see it ". 824. Then, in paragraph 15, you say " Unfor- tunately the T quickie ' was not envisaged". Who invented the " quickie " ? Is it an invention of the Board of Trade, is it an invention of Parliament, or is it an invention of the trade? — The "quickie" originates from an American- expression for American films that were made on the quickie system — " quickies " to be made as cheaply as possible. That is how the word quickie originated. 824a. Paragraph 10, can you assure us that your members would bo anxious to show more British pictures than required by law if they were avail- able and of an equal quality to the British com- petitors?— I would say in those districts where there is a preference on the part of the British public for British films, yes. In those districts where British films are not successful, no. 825. In paragraph 17 you say, " To-day in the populous areas there are as many as five or six cinemas competing for patronage ". Do you think * Annex. that condition is likely to be permanent? — Unless some of the weaker ones go to the wall. 820. Will it be the independents that are elimin- ated or will there be an agreement amongst circuits to reduce? — (Mr. Fuller): We do not know. (Mr. Fligelstone) : That depends on whether the indepen- dent is given the same opportunity of acquiring strength that the circuits have got to-day. 827. You mentioned in your evidence that the K.R.S. object to independents grouping themselves together for the purpose of booking. — Yes. 828. Has that been tested in the Law Courts? — No, but very nearly. (Mr. Fuller) : Very nearly. You can take it that legal opinion as to what they can do is clear although it is a difficult matter. The Board of Trade has stated the law in a report by Sir Wilfred Greene's Committee. 829. You mean the report of 1921 on Restraint of Trade?— Yes. 830. Because it struck me — I read that report this morning before coming here — that some of the K.R.S. regulations are perilously near infringing the Statute of Monopolies. — But they are just inside the law. 831. But that has never been tested in the Courts? — (Mr. Fligelstone) : It is just inside you will find. 832. So that the law is not as clear as you might wish? — I am afraid the law is clear but not helpful. 833. In paragraph 18, there are quite a number of second run houses in a great many districts. — Yes. 834. Are there not also various houses which specialise in the revival of popular films. — (Mr. Fligelstone) : A few. There are one or two, but very few that depend upon revivals, and the question of the runs is really a little involved. There are cinemas that run first, second, and even third runs on a film. 835. Now, in paragraph 19, you say that the 114 British films referred to in paragraph 11 are booked without any choice. Has not the enterprising exhibitor also got the opportunity of going out into the quasi-educational documentary, with just a little wider choice, and bring something new in? — From what is available? 836. Yes? — Well, that we have done with disastrous effects. We booked one of the best which proved very unsuccessful. 837. Has that type of film had a sufficiently large experience all over Britain ? — I should say yes, definitely, but the public will not be educated. 838. In paragraphs 20 and 21. if your Association represents all classes of exhibitors how is it that the independents among your members are unable to receive proper representation and fairer treatment. The paragraph suggests that your Association has not, in fact, been able to exercise the protection for the independents which it sets out to obtain? — That is perfectly right. (Mr. Fuller) : We have asked you to help us with the K.R.S. 839. But on the other hand you said that it was not true that the circuit members of your Association controlled its deliberations? — We do not control the luisiness of our members. 840. Or the policy? — We do not control their business policy. We are their protective Association but we do not book their films for them, and we do not control their finance or anything of that sort. 841. Referring to paragraphs 23-25, the argument you put forward appears to be based on the assump- tion that neither the quantity nor the quality of British films will improve in the near future, but in paragraph 25, you say that " British films, when good, have sufficiently established themselves that an increase in quota is unnecessary for their develop- ment. They can now increase in numbers on their quality without any further artificial stimulus." Well, il the last part of this paragraph is true you will automatically .met a wider selection of better class films? — That is so. 842. Assuming that the plan in paragraphs 26-28 would give exhibitors a wider choice, do you think it would improve the standard of production? — (Mr. Fligelstone) : We do not say that it will improve MINUTES OF EVIDENCE 91 26 May, 1936.] Mr. T. H. Fligelstoxe and Mr. W. R. Fuller. [Contin U( d . the standard of production, all we say is that we want a greater standard of protection from exploit;; tion. We are the consumer not the producer. 843. Do you consider that renters will offer, as you say, twice as many films of a certain quality, that you may be embarrassed by a surfeit of good films ? — No, we shall never be embarrassed by a supply of good films, we shall always be embarrassed by a shortage. 844. Then you feel there will always be a surplus of unwanted films regardless of quality ? — There is bound to be that surplus in the same way as with plays. 845. That must always be the case? — That must always be the case, but it is not necessarily always the case that the intention is good ; but at least let us be certain that the intention is good. 846. Have you known in your experience as an exhibitor any large number of films which you as an expert thought ought to succeed and thought they would succeed and then your judgment has proved wrong and the public has declined to follow you? — Yes. 847. And is that a general experience in the trade, is the public as fickle as that? — Yes. 848. Your psychological experience does not give you any clear indication as to what the public are going to say?- — Well, there are certain standards that you get from experience. You see a film and say " This will go or that will go ", and sometimes we are wrong. 849. You are still apt to make mistakes? — We are still very apt to make mistakes. 850. In paragraph 28, is it not possible that a decrease in quantity might be attended by an increase in quality? — (Mr. Fuller): I will put it this way, that we are always working on 125 usable films. 851. Well, if you exclude certain bad British pictures would it not be equally worth your while to shut out some of the worse foreign films as well? — (Mr. Fligelstone) : Well, as far as the foreign films are concerned we have got a margin of choice. The difference is this, for example the average is I think about two British films released per week and about nine or ten foreign films. Supposing out of the foreign films there are two bad ones and out of the British films there are two bad ones, we are left with no British films to select from, whereas we have still got eight foreign films to select from for that week. 852. You attach great weight to British " quickies " made in the Dominions? — Very great. . 853. Do you despair of legislation being enacted in this country to prevent that? — We do not despair, we must definitely ask for that legislation. 854. Have you made any suggestions at any time as to the general lines on which legislation against Dominion " quickies " might proceed? — I think this is a very important subject, because we should not like it to be thought that there is any question of prejudice on the part of the exhibitors in this country against Dominion production. Let us be perfectly clear on that point. What we do say is this, that the film — I am not dealing with Indian films now, I am dealing with Canadian ami Australian films, that is films made for Canadian and Australian markets — whilst eminently suitable over there may not be suitable for this country, in the same way as some of our very biggest successes over here are not acceptable in America, and so we say in a case of that kind that what is made and is not necessarily a " quickie " over there, but a good Australian film and which does excellent business in Australia, may not be suitable for this country, and should therefore not be admitted as quota over here. As far as the Indian film is concerned, which comes in on a quota basis, you know that India has a large illiterate population and the silent Indian film, the kind of film we receive here ranking as quota, could never be any use to us as exhibitors. 855. How is it that an American film made for America is generally acceptable whereas an 36452 Australian or Canadian film made for those countries is not? — There is a very vast difference in the population to begin with, is there not, and when we speak about Australia and Canada ami New Zealand we must realise, after all, that though they may be very big countries their population is small, and the money expended on their films must be small. 856. It is really a matter of expense? — A matter of expense and taste. 857. Because the polyglot population of America is unlikely to have a taste similar to ours? — Well, it so happens the American taste is similar to ours. 858. What are the functions of the smaller pro- ducers to whom you referred? Are they helping to improve British standards? — They are making a type of film that we can use, they also form the basis of competition and they are an incentive to an advancement in quality of British production and we should be very sorry to lose them. 859. In paragraph 29, your argument is to me of great interest, and I do not want to keep the Committee now, but I suggest it might be worth our while, my Lord, to have a further memo- randum from the Association in writing developing this particular argument which is put. It is the most constructive suggestion that we have had on this particular subject, but it is much too briefly set out for me to be able usefully to cross-examine on it or for us to be able to make any very definite conclusions. Would it be in order to ask then! to consider sending in a further memorandum on this point? 860. (Chairman) : Certainly, and we can re-call them, if necessary. 861. (Sir Arnold Wilson) : We can re-call them if need be, but if we could have a preliminary memorandum, because here is something which is strictly practical. — You would like that developed, would you? 862. Yes, it is practical, but I am not sure whether it is practicable, and 1 would like a further develop- ment on that? — Yes, a further development of the quality clause as suggested? 863. Then in paragraph 31, K.K.S. booking policy. You say that the object of the policy has been to keep exhibitors in competition with one another and for the purpose of increasing and maintaining high film rentals. You say that the effect is to advantage the circuits at the expense of the independents. That being so, do the representatives of the circuits amongst your membership endorse your demand for legislation which will ensure a favoured position for the independents? — The circuits themselves are divided over this matter. Certain of them, I believe, would be quite happy to have an opportunity of our linking up with them even to secure greater strength. 864. But we can still accept the statement made in paragraph 31 as being the corporate opinion of your Association? — Absolutely. 865. It is remarkable that it should be so in view ' of the admitted division of opinion in your ranks, but I just want to be perfectly clear on that point. In paragraph 32, do you suggest that a special com- mittee of the Advisory Committee of the Board of Trade should assess the quality of all Dominion and Colonial films before they are offered in the open market ? — Definitely. 866. Well, as Chairman of that body 1 should not be prepared to admit that we assess the quality, we are only concerned as an Advisory Committee in applying the law as best we can? — That is what we are trying to point out to you, that it is essential, and we make one point first of all that there is no prejudice on the part of the exhibitors so far as the Dominions are concerned, that we did not want to come into this argument at all, but we say we must have protection against unsuitable Dominion or Empire films coming into this country and ranking as exhibitors' quota which are of no use to the exhibitor whatever. M 2 92 COMMITTEE ON CINEMATOGRAPH FILMS 26 May, 1936.] Mr. T. H. Fligelstone and Mr. W. R. Fulij [Continued. 867. Do you regard the Advisory Committee as being a suitable body for that purpose? — We are sug- gesting it could be made a smaller body so that you could call it together more frequently. 868. Would it not be better to have an ad hoc body under the Board of Trade advising it on that particular topic apart from the Advisory Committee ? — I think it would. (Mr. Fuller) : The point we are trying to make was to emphasise that the various proportions should be maintained in any body. I do not think we should worry whether it was the Ad- visory Committee or an ad hoc body. 1 may as well point out that under the New South Wales Act, because someone else will if I do not, the three people who are appointed there to examine the films have no-one connected with the trade with them. The small amount of work that they will have to handle is such that it may not really matter that they are all laymen, but having regard to the magni- tude of our business we should not like to see that in the hands of two or three laymen to judge the entertainment value. 869. You mentioned there is no money in British shorts. How far is that due to block booking? — (Mr. Fligelstone) : Not at all. (Mr. Fuller) -. It was expected to happen when this Act was framed. Films originally were in two watertight compart- ments, long films against long £hns and short films against short films. A lot was said then that there was no money in shorts and that would be the ten- dency for their number to diminish, and that has come about. 870. Can you, as consumers, suggest any way in which British shorts can be made to pay? — (Mr. Fligelstone) : No. 871. Then in paragraph 33, do you not think that the exhibitor must shoulder with the renter part of the blame for this state of affairs? — Definitely, the position is that we do not use sufficient short films to make them lucrative. 872. In New Zealand, I gather, they have got a universal practice of having one long and a variety. Who introduced the two feature system into England, how did it happen? — Strange to say quite a lot of people claim that privilege. It is the natural evolution of the trade that you naturally find by giving the public more you do better business. 873. I gather from other parts of the world, in- cluding your evidence abotit America, there is a far greater tendency to have a single feature followed by variety? — Yes, but also in America there is now a tendency to run a double feature programme. 874. So that they are following our example instead of our following theirs? — That is so. (Mr. Fuller) : The public begins after a time to ask for a double feature programme. 875. Have you any experience of Continental work in this matter? — (Mr. Fligelstone): I have been into one or two cinemas on the Continent, but they run their shows totally different from the way we run ours. I have been to cinemas where they have a pause of ten minutes between each reel, and they all have a chat and a smoke and are quite friendly. 876. You say in paragraph 33 that there are certain classes of short British films that you would be prepared to admit for short British film quota? —Yes. 877. Which are they? — The news reels, the cinema magazines and the pathetone gazettes. 878. Can you visualise elastic legislation satisfying the trades affected in paragraph 35 without a serious amount of controversy and appeal, and so on ? — This is a very peculiar business. When this 1927 Act was first thought of there was no suggestion of talking films. 879. In paragraph 36, what about modern films originally made as silent films but with sub-tit Irs or music added or dialogues synchronised where necessary? — The only one that we have experienced recently is the Chaplin " Modern Times." 880. Is thai lining to become a practice? — The thing is clastic, we cannot see what the future is for us, but the present trend of the trade is for talking films. 881. Now, you have already mentioned first nights as publicity stunts with charitable causes being allotted to them and even Royalty roped in for the benefit of the trade, and the costs put down to the publicity budget, 1 presume? — I did not say so. 882. I said I presumed the costs are put down to the publicity budget? — I cannot say, because we do not see the renters' allocation of that. 883. Touching your phrase " the patriotic obliga- tions that attach to the showing of British quota," to what extent do exhibitors in this country feel themselves to be under any patriotic obligation? — They do feel themselves to be under a patriotic obligation; they like to show as the natural thing a British film. 884. Even though ? — Even though it costs them money they still like to put on a British film. 885. Finally in paragraph 39, television. You say briefly, " doubtless the televising of a film for purposes of public exhibition will be included in any amending legislation," but I confess my mind boggles at the prospect of legislating for anything which is in such an un- developed state. I should like to have a memorandum on the subject as I cannot envisage it, and it is not the business of the Board of Trade to exercise imagination? — I think in that matter your mentality is the same as mine. 886. Then we must wTash out that particular para- graph of your- report. Thank you, my Lord. 887. (Mr. Cameron) : Most of my points have already been covered. You refer to second feature films. I take it that you would always envisage there being a necessity for a supply of second feature films for the smaller houses and as second features in the larger houses? — There will always be second features for the larger and the smaller houses because the film that is made with the best of inten- tions and does not turn out right still has its uses, and its use is the second feature. 888. So there will always be a need for the films made not with the fullest possible cost but on a modest scale, but made as good as possible? — Definitely. 889. On this question of British shorts would it be possible to go back to the idea of British shorts counting against foreign shorts instead of bringing in short and long together. Would that help to give a chance to the British shorts ? — They are not being made, that is the point. The British short i:- not being made. The producers are not making British shorts, they are making long films, they evidently do not think it is economical or worth while making the British shorts. 890. Are there not a lot of shorts being shown which are very bad from the entertainment point of view ? — Yes. 891. To put in something that is half education and half entertainment is of no value whatever; it is probably bad education and bad entertainment, but do you not think there are signs of some firms making shorts that are very good entertainment? — (Mr. Fuller) : Are you quite clear that if anybody chooses there is no opposition anywhere to anybody making shorts. If good shorts come we book them with both hands. 892. If they come along you are only ton glad to have them? — Yes. 893. And you would not object to seeing short set against short on a special short quota? — Providing you are satisfied that the shorts Mould be produced, hut we do not want to create another burden, we do not want to create further exploitation, and if it means that we are going to faced with the " quickie " short again then we would say no. we do not want it. If you could safeguard us, " yes," hut no exploitation. MINUTES OF EVIDENCE 93 26 May, 1936.] Mr. T. H. Fligelstone and Mr. W. It. Fuller. [Continued. 894. On the question of the quality of British films, to take the opposite suggestion to the one put by Sir Arnold Wilson to you, it has been stated and is stated quite often that the objection to British films on the part of the regular cinema goer is that, with certain notable and recent excep- tions they have made with less expenditure of money, since the best artists and the best tech- nicians go to America, and consequently that they are dull both technically and as an entertainment in relation to the American made films? — Yes. 895. Is that a fair statement? — That is a fair statement. (Mr. Fuller) : In the past some have not been quite so slick. 896. Would not that explain to a large extent this variation in area reaction? — (Mr. Fligelstone) : 1 think it would, particularly in London they like something fast, snappy and slick, like the American gives, and they cannot stand the British production that is slow and halting and not as perfect as the American production. 897. And do you get the preponderance of demand for the British picture more in the middle class and residential districts? — Particularly in what I term the country districts, the better class districts which cannot stand the American films. 898. Do you find that under the circuit system there is a tendency for local choice to be eliminated? The taste of a South Coast watering place and the taste of a northern manufacturing town are prob- ably different? — Very different. 899. Do you find that under the circuit system if there is a circuit house in the North and another in the South the same film is shown? — Not always, but in a great number of cases. (Mr. Fuller) : As a matter of fact there are circuits for booking pur- poses within the circuit, and you get certain houses on circuit A, certain houses on circuit B, and certain houses on circuit C, so that you get the differentia- tion within, and that enables them to book in special areas films which have a special appeal which would not be universal. 900. And that is becoming a regular practice? — Yes. 901. There was a time when the circuits first started when that did not happen, was there not? — It may have been, but not now. 902. Are there signs, do you think, of a tendency for differentiation in programme in particular houses? You mentioned one, and the Academy is obviously another? — (Mr. Fligelstone): Yes, Studio One in Oxford Street. 903. Do you find that there is a tendency in the provinces for a similar, but less marked differentia- tion, one house concentrating say, on A films, another on family party films ? — No, I do not think generally, they simply go for entertainment and what the public will come in to see. 904. And have you any evidence that the pro- prietors of the special theatres, whether in the Pro- vinces or in London — because there are some in the Provinces — have a difficulty in getting films, foreign films of a limited appeal, but obviously of enter- tainment value to their particular clientele. Do you find under your existing quota arrangements that your members who are wanting to show that par- ticular kind of film find it difficult, to get it? — I think they find a difficulty, I do not know why. They find a difficulty in getting suitable foreign films. 905. The difficulty I had in mind was getting them on the renters' quota? — That I do not know. (Mr. Fuller) : I have only had one case, which was where a film is brought into this country by someone who has the quota against it, and he just runs through his five or six bookings and then sells the film out- right to another man, and on the transfer the second man woidd have to get some additional quota. That is the only case that I have come across. I have noticed a very big development of these films into a regular business in the last year and there are people who have now got sufficient quota who will take them and rent them. 906. Is it not also the case that the Film Society brings in a film without its being on any renters' quota and an ordinary exhibitor cannot get hold of it? — I think they havo means now of sending it round without any difficulty. 1 think they link up with people who have got some spare quota so that it is only a question of getting a renter to oblige them by registering it. 907. But you are satisfied that where exhibitors want to do that they have got reasonable facilities now for doing it? — I think so. I think the Board of Trade and the Advisory Committee are helpful on that point too. 908. I want further, to be clear what the position would be of an independent exhibitor in a town with, say, four other theatres in it all belonging to a circuit. I am thinking of an actual case where that particular exhibitor had started, and most successfully, to show films of rather a special charac- ter. Now, supposing he wants to compete with the general trade of the town, he wants to book a film that would normally be shown in the circuit theatres or in one at any rate of the circuit theatres, he probably finds he is up against a barring clause, does he not? — Yes, he cannot get it. 909. So does that mean, in a sense, where you have got one independent exhibitor holding out in an area against a number of circuit houses he is debarred from a very large area of the better American and indeed equally the better British films? — Yes. '(Mr. Fuller) : He is up against it. (Mr. Fligelstone) : He is up against it, and that is why we, as independents, want this protection to have the K.R.S. policy put right. 910. Under that he could link up with a number of other people similarly placed? — He would be linked up with a number of other people. 911. People in the same position who would thus be able to compete? — To secure a fair quantity of the products. 912. (Mr. Cameron): Thank you my Lord, those are all the questions I have to ask. 913. (The Hon. Eleanor Plumer) : I have only a few questions left. I gather from the discussion that you do not look upon the Act as a necessary evil, but on the whole the exhibitors' side of the trade welcomes it providing the quota is reasonable. Is that a fair statement? — That is a fair statement. 914. You desire for patriotic reasons to show British films, and you do not look upon the Act as a necessary evil providing the conditions are reason- able?— Providing the conditions are reasonable we like to show British films. 915. In paragraph 28 you say that you are not in favour of the suggested solution of cost as a basis of qualification because you are not convinced that it will be the means of increasing production. I did not think the idea was to increase the production, I think the idea was to eliminate "quickies"? — I think it would eliminate " quickies," but it would reduce the number of films very considerably. What we want to get is the same number of films but of better standard. 916. Yes, I see that perfectly? — And if you set up a cost clause it is going to eliminate a great number of films plus the fact that a number of the American films which we now get into this country would no longer come in because of the cost of the making of the British quota against those American films. 917. But supposing the cost qualification was. as has been suggested, as small a figure as £2 a foot? — We contend you can make just as bad a film at £2 a foot as at £1 a foot. The intention must be there, not the cost. 918. Is it possible to make a good film at less than that ? — Miracles happen. 919. But with such a low figure as that it would not have the discouraging effect that you suggest? I thought that possibly putting a very low figure 94 COMMITTEE ON CINEMATOGRAPH FILMS 26 May, 1936.] Mr. T. H. Fligelstone and Mr. W. R. Fuller. [Coittiit tied. would eliminate certain pictures? — They might not be as crude as they are to-day, but there is no guarantee they will be very much better. 920. I see that, but I thought possibly it would eliminate some necessarily poor films automatically ? — (Mr. Fligelstone). We think that quality is the only means of elimination. 921. And you insist on that. My final question is on paragraph 40, Section 27 (3):— "In general we would remark that very little advantage arises by the continued retention of .3 (iii)," which concerns the author of the scenario, does it not? — Yes, we would prefer that not to be. 922. Yes, we have had a good deal of evidence to suggest that, not that it is very important . . . ? — No, but we would rather it was not. 923. Then you go on to say: — "or (3) (iv)," which concerns the 75 per cent, of wages and payments made. Is not that a fundamental point of the Act? — Our point of view is that we want good pictures, that now that there is a general trend in the industry to put in more than one or two star actors and actresses in a picture who are paid very good money, we say we do not want it limited that 75 per cent, of that money must be spent on British artists. Whaf? we want is good films made in this country. 924. Yes, but you have rather casually dropped in (3) (iv) and it seems to me a good deal comes under (3) (iv), tlie 75 per cent, of wages and payments made. Does not that want amplifying? — (Mr. Fuller): It is really more a producer's point, and we just put it in to show our sympathy with their point if they were putting it up. You will notice the tendency in a very large number of American films to put in two, a popular man and a popular female star. Some producers in some of their recent films have had as many as six, and we think that 75 per cent, of salaries and wages in this country may have a bearing in any reciprocal arrangements you make for Dominion films, but in this country the only thing you want is that it shall be produced in a studio in this country and once you do that you can get all the technicians you want and it means that on every picture you can get the best key- people fit for the job that you want. (Mr. Fligel- stone) : In other words, if I might amplify it, we do not want to put any restriction on the manufacturers of films to prevent them getting the best, whatever nationality they may be. to make good British pictures. 925. But the object of the Act was . . . ? — That has not worked out right. After all, the American producer in America can go to Germany, France and England and get the very best technicians and cameramen to make their films for them, and we want to see our producing companies in the same position, to be able to get the best from the world to make the best British films. 926. The Hon. Eleanor Plumer ; I see, thank you. — Could you give us an indication of when you want the furthei evidence on the quality clause? 927. (Chairman) : As soon as you can let us have a memorandum. — If I might summarise it. my Lord, what we are really anxious to see is better British fiims and to see that we have the margin of protec- tion by having a greater number for selection. Thank you very much, my Lord. 928. (Chairman) : Thank you very much, we are very grateful to you for your evidence. (The Witnesses withdrew.) ANNEX. Schedule of Markings of American Films Trade Shown in 1935. (Renters distributing one or two American films only omitted). Renter. None. »* 9 8| 8* 81 8 n 7i '2 7i 7 6| H 6 5f H 5 4 Total. A.B.F.D. Br. Lion Butchers Columbia Equity Br. Famous F. Nat. ... Fox Gaumont M.G.M. ... Para't. ... Pathe ... P.D.C. ... Radio ... U.A. ... Univer. Wardour Warner 1 1 2 1 3 2 1 1 2 2 1 3 1 4 4 4 10 7 7 5 3 3 3 1 1 8 5 10 17 4 2 5 12 2 9 8 7 14 15 1 11 2 6 1 4 3 2 10 2 15 2 8 4 3 4 1 4 1 6 3 1 6 7 1 2 5 7 8 1 6 1 3 2 6 3 4 2 7 6 4 3 2 1 1 1 3 2 1 4 4 3 9 3 1 2 1 2 1 2 2 l 2 1 2 2 1 1 6 4 2 2 1 2 2 1 1 1 14 11 4 41 10 5 25 45 2 43 56 31 21 45 14 44 10 32 Total 1 1 10 9 47 68 80 65 51 41 37 11 8 16 1 4 2 1 453 INDEX 95 INDEX TO EVIDENCE [Note.— References in italics are to Questions in the Oral evidence; other references are to Pages of the Written evidence] Advance booking, 1, 2, 7, 39, 82, 145, 166, 266, 376, 445. Advisory Committee, 5, 60, 62, 74, 59, 413, 424, 464, 473, 491, 536, 610. Associated Realist Film Producers, Ltd. : — appendices to evidence, 69. memorandum of evidence, 59. oral evidence, 62. Association of Cine-Technicians : — membership, 71, 569, 640. memorandum of evidence, 7 1 . oral evidence, 75. Barring clauses, 10, 37, 186, 712, 908. Blind booking, 1, 2, 37, 145, 166, 195, 445, 624, 663. Block booking, 1, 2, 37, 39, 73, 145, 165, 196, 243, 410, 604, 624, 658, 703, 710, 869. Board of Trade : — appendices to evidence, 20. memorandum of evidence, 1. oral evidence, 13. British film, statutory requirements, 4, 20, 21, 39, 72, 74, 82, 13, 19, 242, 570, 599, 608, 634. Cinematograph Exhibitors Association of Great Britain and Ireland : — appendices to evidence, 94. membership, 79, 731, 750, 838. memorandum of evidence, 79. oral evidence, 82. Cinematograph Films Act, 1927 : — excepted films. See Films, penalties, 3, 4, 40, 73, 603, 621. purpose of the Act, 2, 35, 79, 1. quota provisions, 4, 82. Cinemas : — circuit, 8, 142, 750, 898. independent, 759, 826, 838, 908. Documentary films, 39, 59, 69, 73, 74, 81, 103, 270, 300, 408, 801. Employment in film production, 33, 39, 72, 74, 43, 129, 251, 425, 560, 562, 608, 617. Exports, 12, 3, 28, 39, 150, 291, 486. Film bookings, number of, 10. Film industry : — capital invested in production, 6, 59, 31, 379, 401. position in Great Britain prior to Cinematograph Films Act, 1927, 1. organisation in Great Britain, 34, 403. Film Producers' Group (Federation of British Industries): — appendices to evidence, 58. membership, 58, 116, 347, 356. memorandum of evidence, 34. oral evidence, 40. Films : — British : — cost, 6, 12, 38, 59, 72, 81, 16, 132, 138, 205, 239, 269, 434, 570, 578, 594, 614, 632, 673, 915, 923. Empire films and the quota, 6, 39, 74, 81, 254, 307. exhibited hi quota years, 1932-35, 9. numbers imported from overseas, 6, 25. numbers and footage registered, 5, 6, 7, 51. quality, 8, 10, 11, 26, 37, 38, 39, 71, 73, 74, 17, 23, 85, 142, 165, 178, 201, 228, 238, 242, 269, 278, 294, 303, 307, 314, 330, 357, 361, 419, 578, 586, 614, 622, 632, 642, 696, 700, 738, 784, 815, 841, 850, 865, 887, 894, 923. quality test, 12, 38, 39, 72, 81, 205, 269, 434, 578, 594, 614, 632, 673, 923. registered for exhibitors' quota only, 34, 54. short, 6, 7, 9, 39, 60, 62, 74, 81, 19, 54, 136, 234, 300, 409, 416, 555, 646, 682, 783, 800, 869, 889. supply, 5, 6, 7, 11, 35, 9, 23, 169, 261, 277, 312, 333, 380, 416, 651, 717, 781, 810, 843, 850, 887. foreign : — for special theatres, 73, 65, 159, 287, 601, 638, 904. quality, 6, 8, 647, 784. numbers and footage registered, 5, 6, 7. short, 7, 62, 412, 532, 541, 647, 783. import duties, 32, 4, 24, 156. sub-standard, 13, 108, 259, 689. to which Cinematograph Films Act, 1927, does not apply, 4, 33, 61, 73, 26, 39, 424, 440, 509. " try-out ", 40, 197, 274. Imperial Conference, 1926, 2, 1. Legislation : — in British Empire overseas, 12, 28, 254, 374. in foreign countries, 13, 30. Quota : — average shown by exhibitors, 738, 761. exhibitors', 4, 9, 37, 39, 58, 73, 79, 9, 63, 170, 200, 261, 447, 541, 575, 656, 684, 698, 703, 810, 841, 883. exhibitors' defaults, 10, 786, 835. proposals for amendment, 38, 58, 61, 73, 74, 200, 575, 656, 666. renters', 4, 7, 8, 38, 39, 58, 71, 73, 81, 9, 12, 22, 63, 170, 200, 328, 447, 541, 575, 668, 703, 906. renters' defaults, 8. Remittances abroad, 35, 149. Renters' booking policy, 9, 81, 77, 827, 863. Scenario author, 40, 21, 257, 354, 921. Special exhibition value, 5, 34, 60, 74, 51, 59, 223, 276, 395, 413, 423, 472, 476, 491, 538, 558. Television, 82, 885. Trade show, 82, 685, 881. (36,52-11) Wt. 1567-6S86 376 6/36 P St. G. 335 S.O. Code No. 51-213-1 BOARD OF TRADE Minutes of Evidence taken before the Departmental Committee Cinematograph Films together with Appendices and Index on Fifth to Eighth Days and Written Evidence Crown Copyright Reserved LONDON PRINTED AND PUBLISHED BY HIS MAJESTY'S STATIONERY OFFICE To be purchased directly from H.M. STATIONERY OFFICE at the following addresses: Adastral House, Kingsway, London, W.C.2; 120 George Street, Edinburgh 2; 26 York Street, Manchester 1; 1 St. Andrew's Crescent, Cardiff; 80 Chichester Street, Belfast; or through any bookseller 1936 Price js. 6d. net, BOARD OF TRADE Minutes of Evidence taken before the Departmental Committee on Cinematograph Films together with Appendices and Index Fifth to Eighth Days and Written Evidence Crown Copyright Reserved LONDON PRINTED AND PUBLISHED BY HIS MAJESTY'S STATIONERY OFFICE To be purchased directly from H.M. STATIONERY OFFICE at the following addresses: Adastral House, Kingsway, London, W.C.2; 120 George Street, Edinburgh 2; 26 York Street, Manchester 1; 1 St. Andrew's Crescent, Cardiff; 80 Chichester Street, Belfast; or through any bookseller 1936 Price ~/s. 6d. net 11 CONTENTS PAGE LIST OF WITNESSES AND OF THOSE WHO GAVE WRITTEN EVIDENCE iii MINUTES OF EVIDENCE , 96 INDEX TO EVIDENCE 176 Ill LIST OF WITNESSES AND OF THOSE WHO GAVE WRITTEN EVIDENCE Interest represented. Xames of Witnesses. Page. Written and oral evidence : — Ace Films, Ltd. ... Mr. F. Green 147 Denning Films, Ltd. ... Mr. .1. S. Fairfax-Jones 146 Film Society, Ltd Mr. I. Montagu ... 139 Kinematograph Renters' Society of Great Britain and Ireland, Ltd. ... Mr. S. Eckman ... Mr. J. C. Graham "i Mr. D. E. Griffiths I 96 Mr. F. Hill Mr. J. Maxwell National Association of Theatrical Employees... Mr. T. O'Brien Mr. J. Rogers ... J. 149 Mi-. J. Grierson ... 132 Mr. S. Rowson ... 109 Mr. H. Bruce Woolfe 127 Oral evidence only : — Mr. G. R. Hall Caine, C.B.E., 153 M.P.* Written evidence only : — Cinematograph Exhibitors' Association of Great Britain and Ireland . . . 167 Cinematograph Films Advisorv Committee (Report to the Board of Trade*) 153 Mr. S.F.Doyle 168 Electrical Trades Union 169 Mr. J. L. Greene 169 Incorporated Society of Authors, Playwrights and Composers ... 169 Strand Film Co., Ltd. 170 Theatrical Artists Film Society 171 Trades Union Congress General Council ... 171 Wing-Commander W. E. Wynn, R.A.F. (retired) 173 Julian S. Huxley, J. Grierson and P. Rotha 175 Mr. G. R. Hall Caine, C.B.E., M.P., was invited to give evidence as a member of the Advisory Committee. 37873 A 2 MINUTES OF EVIDENCE TAKEN BEFORE THE COMMITTEE ON CINEMATOGRAPH FILMS FIFTH DAY Tuesday 23rd June, 1936 Mr. A. C. CAMERON, M.C., M.A. Dr. J. J. MALLON, LL.D., J. P. The Hon. ELEANOR M. PLUMER. Peesent : The Rt, Hon. Lord MOYNE, D.S.O. (Chairman). Lt.-Col. Sir ARNOLD WILSON. M.P. K.C.I.E., O.S.I., C.M.G., D.S.O. Mr. W. H. L. PATTERSON (Secretary). Mr. D. E. Griffiths (President), Mr. S. Eckman, Mr. J. C. Graham, Mr. J. Maxwell, and Mr. F. Hill (Secretary), representing the Kinematograph Renters' Society of Great Britain and Ireland, Ltd., called and examined. The Committee had before them the two following memoranda : — Memorandum by the Kinematograph Renters' Society. 1. The Council of the Kinematograph Renters' Society, representing practically all the leading dis- tributors of British and foreign films operating in this country, submit for the consideration of the De- partmental Committee of the Board of Trade pre- sently inquiring into the Cinematograph Films Act the following opinions : — (a) That the obligation put upon distributors of foreign films operating in this country under the Act as it exists to-day involving, as it does in some cases', the production of as many as 15 or 18 feature pictures in one year, is an obliga- tion that is so heavy as to be practically impos- sible of effective performance and results in the present deplorable position of the obligation being met by the procuring of a large number of cheap, poor pictures which bring discredit on the British film production industry and antagonise the British cinema-going public against British pictures generally. (b) That in the opinion of the Council an obligation which calls upon distributors of foreign films to produce five or six feature pictures in the year, instead of the present num- ber of 15 or 18, would more effectively serve the desired purpose of securing a reasonable supply of worth while British pictures, provided always it is accompanied by safeguards that this modi- fied number of pictures are produced under con- ditions as to cost and otherwise that will ensure their being effective and creditable British pictures. 2. In expressing these opinions the Council arc guided by their actual practical knowledge of the operation of the film industry in this country and of the working of the Act during the eight years it has been in operation. 3. The Council are also greatly influenced by the definite and emphatic assurances they have had from their members representing foreign interests thai 'i the obligation upon them is so reduced as to make it really workable, they will \vhole-heark>dly comph with the stipulations as to cost and otherwise neces- sary to ensure the production of worth while British pictures, and give any assurance in their power that will guarantee the carrying out of such stipulations. Memorandum by Mr. J. Maxwell on behalf of the Kinematograph Renters' Society. 1. The K.R.S. was founded in 1915 and consists of practically all the leading distributors of British and foreign films operating in this country. 2. The British producing companies who are repre- sented on the society by their distributing agencies are : — Gaumont-British Picture Corporation, Ltd. ; British International Pictures, Ltd. ; Twickenham Film Productions, Ltd. ; Associated Talking Pictures, Ltd. ; British Lion ; Butcher's. 3. The major American producing companies, Metro-Goldwyn-Mayer, Paramount, Radio. Warner, First National, Universal, United Artists and Columbia are also members by their British dis- tributing companies. 4. The output of each of the above American pro- ducing companies averages about 50 feature pictures per year, and there are seven such companies com- monly called the major producing companies. In the British production field the major producing com- panies are, on the basis of quantity of pictures, Gaumont-British. British International. British and Dominions, Twickenham, and the average annual output of such companies has run around 20 pictures per year each. 5. Since the passing of the Cinematograph Films Act a serious attempt has been made by various British producing companies to establish a film production industry in this country. Prior to the passing of that Act the British film production in- in try had almost ceased to exist. The British pro- ducers, in building up their concerns, have bad to train the necessary artistic and technical talent, as there was no existing supply available in this COMMITTEE ON CINEMATOGRAPH FILMS 97 23 June, 1936.] Mr. D. E. Griffiths, Mr. S. Eckman, Mr. J. C. Graham, [Continued. Mr. J. Maxwell and Mr. F. Hill. country. It has been a difficult and laborious job, and even yet, after eight years, there is nothing like an adequate supply of skilled personnel available. Even in Hollywood, where they have behind them almost 30 years of accumulated experience in large- scale film production, although having a supply of creative talent many times that available in this country, they still find a shortage of creative per- sonnel one of their problems. 6. The Cinematograph Films Act imposed upon distributors of foreign pictures in this country the obligation to acquire a certain percentage of British pictures rising to and at present being 20 per cent. It should be observed that this obligation is imposed on these distributing agencies, the officials and per- sonnel of which are not expert or even in most cases acquainted with the business of film production. As will be seen, most of these companies distributing foreign films have about 50 pictures a year to handle (or one per week), and that is an onerous job, apart from being called on by the Act to tackle in addition the production of a number of pictures ranging up to 18, or under an increased quota it may be 20 or more pictures a year. In a country where the native producing companies are already finding great diffi- culty in getting expert personnel for the manufac- ture of their output of pictures, this presents an almost insoluble problem for the officials of such distributing agencies. 7. The number of pictures under the current 20 per cent, quota required by these distributors of foreign films are as follows : — MetrorGoldwyn-Mayer Warner-First National Columbia Paramount Radio Universal Fox 16 19 10 16 17 13 13 8. In my view it is practically impossible for any of these distributing agencies to undertake and effectively carry out the making of such a number of pictures each year, if made on a proper standard of quality and cost. I can speak with some know- ledge on the subject because I have been engaged in the production of pictures as practically a whole time occupation since 1928. My own company has tried to increase the number of pictures beyond the 20 or so that we handle each year, but has found it impossible to get the talent and skilled personnel necessary to do so. When we did try in one or two years to largely increase the output we found several of the pictures were of such poor quality that we hastily abandoned the idea and confined ourselves to the figure mentioned above. I find that the num- ber of pictures produced since 1928 by the various British producing companies are as follows: — First quota year 2nd 3rd 4th 5th 6th 7th ended year. year. year. year. year. year. 31-3-29. 8th year. Gaumont-British (including Gainsborough) B.I.P British and Dominions Twickenham... British Lion London Films Associated Talking Pictures Butcher's 18 18 7 3 5 10 15 17 13 21 21 16 27 23 25 21 20 4 6 8 18 19 19 3 3 18 14 23 24 1 5 2 4 13 6 — — — 5 3 2 4 4 5 3 18 14 19 7 9 3 4 6 9. In the past, owing to the inability to get a sufficient number of worth while pictures, the agencies distributing foreign pictures have had to buy such stuff as was available for them to comply with the terms of the Act, and there is no doubt that the class and quality of the pictures so acquired has, in many cases, been greatly inferior to the standard output from Hollywood of such companies, and even of the major British producing companies. These companies fully appreciate the serious dis- advantages that arise from putting out quota " quickies," but their experience is, and personally from my own experience of the business I confirm it, that it was impossible in the circumstances for them to do otherwise. It must be kept in view that the primary purpose of their business in this country is the distribution of films, and it is in that rapacity that the burden of producing a large num- ber of British pictures is imposed on them. It seems to me unreasonable to expect them to be able, in addition to carrying on their business of distribu- tion, to also undertake the production of such a large number of pictures each year as is called for under a 20 per cent, or higher quota, i.e., an output equivalent to that of a major British producing company. 10. These companies have also given us the assur- ance that it is their serious intention to acquire and produce worth while pictures and put in the sub- stantial money necessary for that purpose if the number they are called upon to produce or acquire is limited to what is regarded by practical people as possible and reasonable. 11. The poor quality of many of the pictures acquired for quota, in order to comply with the 37873 letter of the Act, has done a great deal of harm to the standing and prestige of British pictures generally, and for myself and I am sure all those seriously engaged in the busines of British film pro- duction I would welcome an alteration of the Act which would permit, and possibly ensure, that the number of pictures acquired or produced for quota were of a quality and standard that would not bring discredit on British pictures generally. -12. I am also prepared to go the length of stating that if the number of pictures which are required to comply with quota remains at the present figure— or is increased — and if it were possible that these should all be good quality, marketable pictures, the result on the fortunes of the native British producers would be serious, owing to the greatly increased quantity of pictures they would find com- peting with them in the British market. So far the native British producer, owing to the poor quality of the pictures acquired for quota, has not felt them as competitors. If the number of pictures required under a 20 per cent, or greater quota, are all, as it is now hoped, to be made of a good quality and cost standard, such a large addition to the number of worth while British pictures would make serious inroads on the returns that have hitherto been got by the purely British producing companies men- tioned above. The margin of receipts over cost at present got by the purely British producing com- panies is narrow, very narrow indeed. Indeed, I am safe in saying that very few of these companies' pictures show any profit, and if their present returns were going to be diminished, as I am sure they would, by a large increase in the number of worth while pictures made here, the results would be A 3 98 COMMITTEE ON CINEMATOGRAPH FILMS 23 June, 1936.] Mr. D. E. Griffiths, Mr. S. Eokman, Mr. J. C. Graham, [Continued. Mr. J. Maxwell and Mr. F. Hill. seriously injurious to the fortunes of the purely British producing companies. Any increase of quota would also in all probability be an inducement to a rush of mushroom companies and prospectuses as happened when the Act was first passed and also probably be followed in due course by a sequence of bankruptcies and liquidations as happened before. 929. (Chairman) : Your organisation covers both the British Renters and the foreign-controlled renters, does it? — (Mr. Maxwell): Yes, Sir. 930. Are there some that stand out, that have not joined? — Only one, Fox, an American Company. They are not in at the moment because of some difference on a question of policy not connected with this matter. 931. What is the bulk of capital involved in the renters' branch of the industry ? Is it British or foreign-controlled? — It is about fifty-fifty. The number of American-controlled renting companies is about equal to the number of British-controlled. A list of renters is given in one of the Board of Trade Schedules, page 24. Actually at the moment the K.R.S. has as members (a) British-controlled : A.B.F.D., British Lion, Butchers, Gaumont British, General Film, Pathe, Twickenham, Wardour ; and (b) American-controlled : Columbia, First National, Metro-Goldwyn, Paramount, Radio, United Artists and Warners. 932. I am not sure if the capital is given? — The list is on page 24 of the Blue Book. 933. Is the capital given or only the numbers? — There is no capital given, no. 934. It was really capital I was getting at? — It would be very difficult to give you that figure because these renting branches are mainly sub- sidiaries of large parent companies. 935. They are really subsidiaries of the producers? — Largely, and the amount of capital may be rela- tively small to the value of the goods that they handle. They are merely sales organisations that need very little capital. 936. Yes, and of the witnesses to-day you A are about half and half British? — No, I am the only British, the others are entirely American houses, but they are British registered companies. 937. The rest of the witnesses are all representing American companies? — Yes. Mr. Hill is the Secre- tary, of course. He is an official of our Society. 938. And are you all three American citizens? — (Mr. Griffiths) : No, I am a British citizen. 939. You are a British citizen, but you represent an American Company? — Yes. 940. Now, we have had your two memoranda, perhaps I had better take them in the order of date? ■ — (Mr. Maxwell) : Might I make one correction on my statement? In paragraph 8 of the second memorandum, where I give the output of the various British film companies for the last eight years there is a figure to be corrected in regard to London Films. I have given them as five in the fifth year, three in the sixth year, two in the seventh year and two in the eighth year. That figure of two in the eighth year ought to be three. There was some little doubt, because one film was registered as being a joint production of London Films and Capitol Films, but London should get credit for that. 941. I think in your first memorandum you talk about some companies having to produce fifteen to eighteen feature pictures in one year ? — Yes. 942. That is rather exceptional; from the figures that have been published I think only two go into that category? — Warner First National have to-day to net nineteen, and the next is Radio with seventeen. 943. But the rest all come below that? — Para mount is sixteen and Metro-Goldwyn-Mayer is six- teen. I have given them in paragraph 7 of the second memorandum of my statement. 944. Yes. Does this necessity to find British l-itures to cover your quota requirements in fact result in keeping any good American pictures out? — No, undoubtedly not. 945. They all come here? — They all come in, yes. 946. So that when the exhibitors say they have a difficulty in fulfilling their quota requirements, it is merely the British end, that they do not get as many good British pictures as they would like ? — Yes. 947. And an embarrassing choice of American pictures? — In some cases, yes. 948. And no good American picture is kept out by the present requirements? — No. 949. In the Board of Trade evidence — I think it is reprinted now in the Blue Book, we have been told that the United Artists' Corporation more than fulfil their quota requirements, they were able to produce twice as many British films as they were obliged to do? — Well, they do not produce any at all. 950. But they get them? — They were fortunate in being able, through the advantageous form of their structure, to get a number of British producers to give them the distribution of their British produced pictures. The United Artists' set-up lends itself to that kind of transaction. It was founded by Charlie Chaplin, Mary Pickford. Douglas Fairbanks and D. W. Griffiths many years ago as a distribution organisation for their own pictures, and it is still purely a distributing organisation. These artists were working then for the large producing companies like Paramount and the other American Companies, but they decided to separate themselves from their employers, and as they were wealthy they said, " AVe can make our own pictures, we have the money to do it, but we must have our own distributing organisa- tion to get the best results ", so they set up this distributing organisation which was really a kind of co-operative organisation of famous artists to distribute their own pictures. That being so the number of pictures available to United Artists is never large, it varies according to the mood of their constituent members to produce pictures, and there- fore they are always free to take other producers pictures and glad to do so if the pictures are of good quality. That is why they have more British pictures, because their set-up makes it easier and they have usually a small number of American pictures relative to the other American companies. 951. Do the London pictures find their market through United Artists? — Yes, through United Artists, and so do British and Dominions and a number of others. Their structure lends itself to assimilating artists from time to time and producers who will make new pictures for them. They have only a relatively small output of pictures from their American producers, being in this respect totally different from the other American renting Companies who have a regular annual output of about 50 pictures each from the parent concerns in Hollywood. 952. But it is American-controlled capital? — Yes, it is American-controlled capital. 953. And this American-controlled capital is marketing British pictures? — Some of the outstand- ing British pictures. Of course it is a very desirable thing for a British producer to get his distribution through United Artists, because in the first place they have not a very large number of pictures themselves, and therefore plenty of room to absorb more, and secondly the United Artists having a world-wide distribution — in America. Canada and everywhere — the British producer who gets his pictures through them is rather fortunate in getting a world-wide machine put at his disposal. It is also good business for United Artists, for as they make no advances and give no guarantees on these British pictures, they have no production risks, so all the British pictures they handle yield them profit. 951. [Mr. Cameron): I am right in thinking, am I not. that the United Artists is the only one of the big distributing organisations that has not got its own producing organisation? — Yes, United MINUTES OF EVIDENCE (J9 23 June, 1936.] Mr. D. E. Griffiths, Mr. S. Eckman, Mr. J. C. Graham, [Continued. Mr. J. Maxwell and Mr. F. Hill. Artists is a co-operative and distributing organisa- tion of eminent artists and producers as its name bears. They formed this co-operative organisation to distribute pictures, and the constituent members do the producing at their own risk and expense. 955. {Chairman) : That is the normal arrange- ment, the renting corporation is a subsidiary of the foreign producer? — Not exactly. If you take all the other members of K.R.S. who are handling foreign pictures, they are all allied by franchise or otherwise with an American producing company, which company, with its own money, makes about fifty pictures a year, Paramount, Fox, Warners, Metro, and so forth. 956. And why can they not do the same thing in the way of getting British films that this other corporation have done ? — I think they would be very glad to do it, but their set-up makes it very difficult. In the first place, they have got fifty pictures of their own each year to handle, which is a large number. I think that is the only difficulty. Is there any other reason, Mr. Eckman? (Mr. Eckman) : Yes. 957. The difficulty is they have got these American pictures ? — (Mr. Maxwell) : They are fully occupied with their own large output. I should say the main reason why the others cannot do as United Artists do is first of all they do not get the chance, and they would gladly do it if they had, and if you ask me why, I would say it is because the United Artists' co-operative structure lends itself to that kind of thing and the number of pictures they have to handle from America being much smaller than any of the other American companies they have more room to do it. Their sales forces have a margin of time and energy available for it. (Mr. Eckman) : If I might just interject a word or two, the Company I represent has on many occasions made an attempt to get the better British films, but the British companies are reluctant to distribute through our agency because their attitude is that we have so. many, if I may say so, outstanding films of our own, that we could not possibly lend our best efforts to the distribution of their films. That is their opinion regardless of what we may say to the contrary, whereas when they distribute through United Artists, and that company not being a pro- ducing company, they feel that one producer has just as much opportunity to get the best results as another. 958. (Chairman): I see.— Shall 1 put it in another way. They feel, and nothing we say to the con- trary will disillusion them, that because most of the pictures we handle are our own we would necessarily lend our best efforts to the distribution of those films to the detriment of theirs. 959. They feel you would push the American pictures rather than the British, having no obliga- tion to do other than offer the pictures but not to place them? — Yes. 960. But you have very large capital at your dis- posal ? — Yes. 961. And have you made efforts to produce directly in this country any of these American producing com- panies?—It is definitely planned at the moment, but the reason we have not produced up to the present time is because it is so difficult to get the proper personnel. We are rather, wrongly or rightly, envious of the reputation we have established as producers throughout the world, and we have felt disinclined to produce over here until such time as we could produce here as well as we produce on the other side. 962. Is there anything in the existing law over here which would hamper you in producing? — Frankly I have not gone into that; I do not think the com- pany has gone into that question. It is simply a question of available man-power, producers, directors and stars, that deters us, not capital or anything else. (Mr. Maxwell): Mr. Graham's Company have done 37873 some production over here some years ago ; perhaps he might tell you whether any effort has been made to meet that point. 963. Could you tell us your experience briefly, Mr. Graham, whether you have given up attempting to produce, and why? — (Mr. Graham) : We were the first producers in this country before there was any law ; we were in the British industry at that time, and we were perhaps five years ahead of the time and we .were spending a million pounds when we stuck. There was a loss of £600,000, and £300,000 of that money was put in by British people and we paid it back to them and it meant a loss. 964. What was the reason of the failure? — The reason of the failure was that we made these pictures in a period in the industry which had not ad- vanced to its present status, in efficiency, in studios, and so forth, and after we finished those pictures and put hard work into them, the exhibitors said, " Well, we believe we had better take your other pictures," so we had to quit that. That was a period of three or four years before the present quota law was in force, and we did that entirely on our own. 965. Do you consider that these conditions have been modified? — Not the cost. There are many things that still affect it, of course. This was a partly- owned British company that had been formed here to produce British films, and because we saw we had taken them up the wrong street we paid them back all the money at 6 per cent, and took the loss. 966. But you were careful to tell us that the British industry was rmich less efficient? — After the quota law was put into effect we took a stage, and we began to bring personnel here as much as we could under the restrictions of the law, and we pro- duced in one year pictures ranging in cost from £30,000 to about £70,000. I think those were the figures, and we lost money on that, on the whole lot, and we had to stop. Korda got his start with us; he made one picture which did very well, and that was the picture which enabled him to get his capital. 967. You brought over your directing personnel for the pictures? — We hired some here, but mostly we brought it over, but of course we had to produce under the law in order to make British pictures. 968. Quite, 75 per cent. British? — That one year we did eight pictures, and then we found it did not pay, that it was a big loss, and it was heavier on us than our capital would stand, so we dropped down to a lower grade of picture in price, because the law was going up in quantity. 969. Well, in your original memorandum you sug- gest that five or six feature pictures in the year would be a reasonable number to produce? — (Mr. Mar trill) : Yes. 970. That is for every company ? — For each of these companies. 971. Irrespective of size? — Well, they are all about the same size. They all turn out about 50 pictures a year in America and import that number into this country. 972. Would there not be a big outcry as to inequity if you departed from the basis of the requirements being in proportion to the scale of operation? — I am not suggesting that that should be departed from. It is a matter of readjusting the percentage; in other words, it would be a 10 per cent, quota on the basis I suggest. I have talked of number of pictures, as that is the most realistic and understandable way of stating it. !)".;. It would be an average of six? — Yes. 974. Would you still keep it proportionate P — Each company would do live or six, or four, according to its import of pictures from Hollywood. 975. You do not mean a flat rate of six all round? — No, it would be translated into a percentage of pictures imported, the figure of five or six being. according to my experience, as many pictures as A 4 100 COMMITTEE ON CINEMATOGRAPH FILMS 23 June, 1936.] Mr. D. E. Griffiths, Mr. S. Eckjian, Mr. J. C. Graham. [Continued. Mr. J. Maxwbm, and Mr. F. Hill. can be produced by a distributing company in those circumstances and make really good pictures. 976. But it is not a matter of money, the bigger company's profits? — No, it is not a matter of money. These companies have all plenty of money. It is a matter of being able to organise and secure the creative artistic talent that is necessary for the making of good pictures. 977. But is not there the same limiting factor in America? — No, because America, I should say off- hand, has got a reservoir of talent, ten times as big as we have got in London. When I say " talent " I mean talent for making pictures. When you look at the figures in paragraph 8 of the second memo- randum you will see the best illustration of what I mean. There you have got the output of London Films. In that case you have got a very experienced and able man at the head of it, Mr. Korda, who has been an expert in making pictures to my know- ledge for 15 years, it is his life's work and occupies him night and day. He has got unlimited financial resources, and owing to his prestige he has got the pull on any talent that can be got in any part of the world, but his output was three pictures last year, two the year before, two the year before and five the year before, and that is out of probably nine or 10 pictures that he announced his intention of making, but with all his resources he could only make that small number. When you seek to impose on a busy distributor like Mr. Eckman or Mr. Graham the making of 16 or 18 pictures a year, the pictures cannot be well made and it is an impossible burden. If you are content to have cheap pieces of rubbish you might get that number, but they cannot do it and make really good pictures. My own company made 14 last year, and we had the greatest difficulty in getting enough skilled personnel, although with us it is a whole-time occupation and with plenty of capital. It is our aim and effort to make a large output of British pictures, but owing to the limitations of the personnel necessary we were only able to make 14. 978. You'say that if the obligation upon you were reduced so as to be in your opinion workable, you would comply with any stipulation about cost? — Yes. 979. What do you consider to be a reasonable cost to produce a worth- while picture? — Well, I am not under an obligation myself to make any quota pic- tures, because our pictures are all British and all quota. I am only speaking on behalf of the American members, and I am only trying to put their case as it appears to me as an experienced neutral, if you like to use that term. The amount of money they are prepared to spend on making really good pictures, if they are asked to do it on a practicable scale, is anywhere from £30,000, £40,000 or £50,000 per picture. 980. What does it work out to per foot in the opinion of your organisation? — If they spend £50,000 it works out at about £7 a foot. 981. The quickies are sometimes produced as low as 15s. per foot, we have been told? — Yes. (Mr. Graham): That is the footage, that is because of the demands for footage under the law. If we were allowed to spend money on a reasonable amount of pictures, instead of having to go to eighteen pictures, as I am making now, you would get some pictures that would be worth-while for your theatres. 982. You do not propose to spend more money on making more pictures, but you propose to spend the same amount of money . . . ? — Intelligently. 983. ... on better pictures?— Yes. (Mr. Mate- well): They might even spend more money, because if they go out to spend anything like the monej 1 am talking about, £40,000 or £50,000, as business men they must make- that picture so good that it will be fit to go through the whole of their world organisation in order to get their money back, there- fore they may have to spend more, they may not stop at £40.000 or £50,000 or even £60,000, thev must make a picture that is good enough to go throughout the world, for there is no certainty of getting that kind of money back from this count ry alone. 984. Are they proposing to spend more money on the same pictures, or more money on fewer pictures? About the same or possibly more money on fewer pictures. 985. Can you give us any idea as to what basis can fairly be taken as qualifying a picture on the grounds of cost for quota if that method were adopted. Some witnesses have urged it, and have made suggestions as to what cost per foot should be taken as automatic qualification? — There has been a scheme already con- sidered by the Advisory Committee, which I think is a pretty good practical scheme, and that is to fix a minimum standard say of £15.000 for any picture to comply with quota, and then if double or more than double that amount is spent on the picture to count it as two for quota. 986. But do you think that good pictures can be produced for £15,000? — Oh, undoubtedly. I know because I have done it. (Mr. Griffiths) : We have done so 987. Then the last point of your second memor- andum, the last paragraph seems to me to suggest that if the quality of pictures is improved and the volume remains the same it is going to hit the native British producers? — (Mr. Maxwell) : If that were possible to get such a large number of pictures and all of good quality ; I do not think it is possible, of course. 988. But it would only hit the bad pictures? — No. it would hit the British producer who is producing good pictures. 989. There would be more competition ? — As I put it earlier on, this large number of pictures — I think it is 104 or 111, that are produced for quota at the moment by these American companies so far have been negligible as competitors with us, the native British producers. They have been so bad that they did not compete with us, but if it were conceivable that the same number of pictures should be produced on a really good scale, as really worth-while pictures, that would be 111 new pictures as new competitors on the market so far as we were concerned, and it would be a rather disastrous thing. 990. It would rather depend on the level of the quota, and we have been told by the exhibitors that they have great difficulty in filling their programmes to comply with the quota? — Yes, in some few cases. 991. So that it would be a difference of interest between the producer and the exhibitor? — Yes, naturally the exhibitor wants the largest possible number to pick from. 992. That the good producer ought not to be hit? — It is only the exhibitor in some places who has difficulty in getting his quota. In some places they undoubtedly have difficulty. I do not think the bulk of them have real difficulty in getting the quota because you must remember that the actual output of British pictures is according to the Board of Trade figures, page 7, Table D of the Blue Book, fifty per cent, higher than the statutory require- ment last year. When the point is made that the exhibitor at present is playing more than his statu- tory percentage that is probably quite true but the real fact is that he is playing considerably less than the statutory percentage of the British pictures that are produced. There is a number of between 80 and 90 British pictures produced each year that are not produced for quota purposes at all, like my own company's output: we make pictures because we want to make them, and we believe it is worth while making them. We do not make them because we have an American output of pictures. Therefore they are surplus to what the law requires for quota. As a matter of percentage 1 think the Board of Trade figure is that instead of there being 20 per (out. there is 30 per cent, of British pictures avail- able to the exhibitor? (Mr. Graham): May I add that we find ourselves in the position where our MINUTES OF EVIDENCE 101 23 June, 1936.] Mr. D. E. Griffiths, Mr. S. Eckmax. Mr. J. C. Graham, Mr. J. Maxwell and Mr. F. Hill. [Continued. quota pictures cannot be distributed abroad, they are not good enough. If we could make fewer pictures and spend more money on them we should give those pictures the benefit of our world organisation in distribution. Whether that would be of any benefit or not to the British Empire it is not for me to say, but I think it would, and the pictures that are made now never get outside the country. 993. Yes, your argument that the producer would be injured by a larger output of good British pictures would rather depend on the price. If the exhibitor pays more for a good picture than he does for a bad picture the producer wall get it back? — Not quite — that is hardly the criterion. The point is that there are only so many play-dates available in the country. There are a certain number of theatres, and each theatre has got 52 play-dates if it has a weekly programme, or 104 play-dates if it changes its programme mid-week. If there are an extra hundred or so pictures thrown on the market which are going to compete with us, i.e., if they are good marketable pictures instead of " quickies " as hitherto, then there is going to be double the com- petition that there has been in the past for the available play-dates. The exhibitor pays for a picture a percentage of his Box Office takings, and if you get the play-dates the money comes, but if you do not get the play-dates you cannot get the money. 994. (Chairman) : Thank you. 995. (The Hon. Eleanor Plumer) : In your first memorandum your recommendation really amounts to this, a reduction in renters' quota? — Yes. 996. What would happen if there were no renters' quota? — Well, speaking from the producers' point of view, and from the Renters' Society point of view, we would have no objection. 997. No, I do not imagine you would? — Some British producers would, but in my own case I would not mind for we can use all our studio space for our own productions. Probably the deputation you had from the F.B.I, would, because they are mostly people who have got studios to let, and they want to let them and if possible get compulsory tenants by statutory necessity. Your real trouble would come from the exhibitors, who would squeal. They would say, " You are putting a burden on us, and you have taken no definite steps to ensure that we shall be able to carry out the burden you have imposed on us," and probably they would argue further that in a court of law a contract that was impossible of performance was not enforced, and that an even higher duty rested on the legisla- ture to see that a burden is not imposed which is incapable of being carried out. 998. So that you think really, in equity, the two go together? — I am afraid, much as I should Kke to, I cannot see any other answer to that question. It was considered very carefully by the Trade with Sir Philip Cunliffe-Lister in 1927, when we were considering the framework of the Act, and that was the basis of the discussion then. 999. And your experience of the working of the Act would bear that out? — -Undoubtedly, that is part of the complaint now, that 50 per cent, of the pic- tures that are available to-day are so bad that they cannot use them. In other words they say, " The law is a dead letter; the law has put the burden on us, but the machinery it created to deliver the goods to us is not working, it is delivering goods which we cannot use." (Mr. Graham) : My point was that the law put that burden on the foreigner only, so whatever your law is you have a duplica- tion. You have got the situation that the foreigner was first making pictures, and the British producer looks round and sees something in this business and goes into it of his own volition and makes pictures. and you do not put him under the law, you cannot require anything from him, but you have to require only from the foreigner, so you get a duplication. 1000. Yes, I see your point. Then in paragraph (&) you say, assuming " that this modified number of pictures are produced under conditions as to cost and otherwise that will ensure their being effective " : well, we have been discussing the question of cost, but what conditions and safeguards come under "otherwise"? — (Mr. Maxwell): I am afraid it is a terminological exuberance. 1001. I rather thought so. Then turning to your a i -nit nt of evidence, Mr. Maxwell, you speak in paragraph 5 of the second memorandum about the inadequate supply of skilled personnel? — Yes. 1002. That is a real difficulty? — It is very serious. That is the creative talent that precedes the actual " shooting," that is the photographing of the picture in the studio. The people we want for that are. first of all, a producer, the man who organises the details of the production, approves of the story, gets the scenario prepared, etc. We also want a director, or even before the director we want scenario writers. That is our biggest difficulty in this country, to get people who can write scenarios, bearing in mind that until 1927 there was little occupation for such people, and therefore assuming no occupation they do not exist, and they did not exist, and we have had to find and train them, and we have had to go slowly on account of that. I know, I speak from experience, because I have been working on production in this country since 1927, and keeping up a large annual output of pic- tures. We have had to go along slowly, and we find it difficult to get a supply of personnel, writers par- ticularly, who can write for the screen. It is no use telling me, " Mr. So-and-so is a playwright ", or " Mr. So-and-so is an author " ; that does not meet the problem. He must have the peculiar talent of being able to tell stories in terms of pictures on a screen, to make drama in the terms of pictures, not to make drama in terms of words. Good directors who can take the scenario and dramatise it on the floor with actors, are also difficult to get. We have a number, but not a sufficient number. Of all those who are tried out some have succeeded and are working to-day, others have been scrapped to go back to where they were before, and it is a matter of trial and error, but we have not got sufficient of them. Even in Hollywood wTith their experience of thirty years that is still their major problem, to get the people who can create things for the screen, the writers, the producers, and the directors, and in a minor degree the actors, but we have usually plenty of actors. 1003. I see in your memorandum you do not men- tion any question of shorts at all. We have had a good deal of evidence about that? — No, we, of course, are mainly concerned with feature length pictures. Shorts, as you probably know, have not been of much moment in this country, although I can speak per- sonally with some knowledge of shorts. I put it this way, that we have been the whole time devoted to trying to solve the major problem of making feature pictures, which are the most important things for the maintenance of the theatres and the most likely to yield your money back. I have some knowledge of shorts because I took over a company, the British Instructional, that had been making these for years and was financially a failure. For a year or two after we took it over we continued to make shorts, all these Secrets of Nature about the " Love-life of a beetle " and that sort of stuff, but we found we lost money on them, the general public unfortunately did not seem to be interested or got tired of them, and we had to give it up. 1001. Would ili.it be partly due to the development of the two-feature programme? — Yes, we found in tho silent picture days when the two-feature pro- gramme was not so common then' was a distinct niche which the shorts filled, but the two-feature programme had a definite effect in leaving very little room for anything else in the programme except the news reel. 102 COMMITTEE ON CINEMATOGRAPH FILMS 23 June, 1936.] Mr. D. E. Griffiths, Mr. S. Eckman, Mr. J. C. Gbaham, Mr. J. Maxwell and Mr. P. Hill. [Continued. 1005. And there is a definite shortage of British shorts at the moment? — Yes. 1006. Would you favour the registration of certain shorts which are at present non-registrable ? — Yes, again, from my own point of view I should not mind. In this case also your kick would come from the exhibitor who would tell you that you .were depriving him of his birthright, which is to get pictures to meet his quota obligations that are really entertain- ment. You see, the provision in the Act about excluding certain kinds of shorts from ranking as quota was really so that it would not be possible for renters who required quota to acquire shorts that were not really of any entertainment value, and use those in order to comply with the quota requirements. (Mr. Graham) : We can register a feature against shorts and features. 1007. Yes, I know that? — We can register shorts against shorts. I made shorts in one year and applied them. 1008. Yes. One last point. We have had a good deal of evidence on the subject of advance booking and blind booking, and so on. Is it a true state- ment to say that the clauses in the Act dealing with advance booking have been ineffective? — (Mr. Maxwell) : No. I should think there are some ad- vance understandings that are entered into, but not translated into contracts, verbal understandings, when, let us say, a renter has got a very good picture and the exhibitor wants it, and the renter says, " I am having half a dozen others coming along. I expect you to take these if you take this one." There may be a verbal arrangement of that kind, but British renters are as guilty of that as American, whenever they have a picture good enough to justify it. 1009. I was not suggesting they were not? — There is something in it, but, of course, it is not serious. It is illegal, in the first place, so it cannot be a binding contract under the Act. At the most it would be an honourable understanding, but I sup- pose an exhibitor who made it, if lie did not want to carry it out, would have no compunction about refusing to recognise it. 1010. Would you say that that part of the Act was unenforceable ? — Not at all ; it is just one of those things that I think no legislation can counter. You might make it so that I was not allowed by law to buy a sweepstake ticket for the Irish Sweep, but if I care to do it in the privacy of my smoking room who is to stop me? 1011. Would you suggest that those clauses of the Act should come out in any revision? — No, I think they are most valuable clauses. If anything can be done to strengthen them, let it be done.— (Mr. Graham) : You refer to the six months' advance book- ing? 1012. Yes. — Oh, yes, everybody follows that; s>ix months from yesterday we sign and make a contract, but six months from to-morrow we do not. 1013. We have heard a certain amount about the "gentlemen's agreement "?— (Mr. Maxwell): Yes, I think that is a trifling thing which will always exist in any business. 1014. (The Eon. Eleanor Plumer) : I see. Well. that is all, thank you. 1015. (Mr. Cameron) : I take it, Mr. Maxwell, that your case, in effect, is this, reduce the amount of the renters' quota to manageable proportions and we will then get films made that are worth while and will do justice to the British film industry? — Yes. 1016. It would follow from that, would it not, from what you said just now. there would have to be a corresponding reduction in the exhibitors' quota?— Yes. 1017. Would you agree that the surplus already mentioned of British pictures not produced for quel a and available to exhibitors are mainly available to the exhibitors in association with your company, or Gaumont-British, the bigger companies rather than the individual exhibitors? — I quite agree there is some point in that. Let me put it in this way — which will give you the answer. A successful picture, to be a successful British picture, has got to get about 1,500 playdates or bookings, and in fact does. The most 1 can give it in my own theatres is about 200, so obviously the other 1,300 playdates have got to come from independent ex- hibitors, and that is a very large proportion over 80 per cent, from outside our own circuit. 1018. But yours are first-run bookings ? — They may be more valuable financially, but that is hardly rele- vant to the question of availability7 of supply to in- dependent exhibitors. There must be at least 1,300 playdates from other exhibitors, and the same pro- portion applies roughly to Gaumont-British, the only ether combination of film producer and cinema circuit. 1019. Yes. You made 14 pictures last year? — Yes. 1020. Those were all intended as first-feature pictures? — Yes. 1021. And is not that true of most of the British- made pictures appearing in your list? — Yes. they are all, as I say, people who are making pictures for the sake of making them, not for quota purposes. 1022. But many of the American-made pictures coming in are pictures made in America as pro- gramme pictures rather than as first-features? — Yes, there are some undoubtedly. They have what they call Grade B features there, and you have also got some independent producers in Hollywood, not the major producing companies ; their pictures are usually second, features, yes. 1023. May there not be — I am not suggesting there is, I am only asking the question — in the future a need for pictures made for the smaller houses, made deliberately as second-feature pictures, but as a genuine contribution to the production of the country and not simply to fulfil the quota ? — The luck of the game will always provide second features, because if I make 14, probably not more than 10, or it may be only seven, will be really first-features, the others will have to be graded as second-features, and that is how it works now. Nobody can make good features all the time, in fact it would be a very high batting average if I could score 10 out of 14. 1024. So if the country sticks to the two-feature programme, the second-features will be recruited, so to speak, from among the failures in the first-features rather than from among a special class of picture? — Yes. 1025. Then one other point ; if your recommenda- tion were adopted, it would mean an expansion of a tendency becoming evident to-day for a greater link-up of capital between Great Britain and the United States, would it not? — I do not think so. 1026. I mean on the United Artists' principle? — No, it would not. 1027. It would mean interavailability ? — It would mean that some of the money that is going to America at the moment, or being retained to go into quota quickies, would be retained here a little longer, or on a larger scale, for making better pictures here. 1028. But would it not mean that an American company making a picture in England, on your basis of spending £30,000 on it, would want to get that picture into America, just as you would want to get your picture into America ?— Certainly, yes. 1029. But would it be desirable in your opinion that there should be a greater link-up to facilitate British-made pictures getting into America?— 1 think that would be a great advantage. Those bigger and better pictures that would be made by American companies woudd not go only into America. hut would go throughout, the whole world, because they would be made on a scale which would justify it and it would be the only way to get the larger monev back. MINUTES OF EVIDENCE 103 23 June, 1936.] Mr. D. E. Griffiths, Mr. S. Eckman, Mr. J. C. Graham, [Continued. Mr. J. Maxwell and Mr. F. Hill. 1030. And your ordinary British pictures would benefit by that?— Yes, these better pictures going throughout the world would benefit us, because people seeing them in foreign countries would say, " There are apparently good British pictures to bo had; let us go over to London and buy some." 1031. That is a logical amplification of your case?— Yes. (Mr. Graham) : In our business we have to turn out a picture for quota every three weeks, and that is ridiculous to start with. Now, those pictures have no more chance of getting into America than I have to jump across the Atlantic Ocean, but if I made four pictures and spent the same amount of money on them I should have a market where they could absorb them to an extent of the proportion of their cost. That is the whole thing we are driving at. We are not trying to say we should not spend money here if the Government says so, but we say let us spend it intelligently. 1032. Yes, and then, Mr. Maxwell, one other ques- tion which occurs towards the end of the first of your memoranda, you talk about the need for more technicians, and so on, which I think we all appre- ciate?— (Mi\ Maxwell): Not so much technicians. I do not mean sound recordists, cameramen and other mechanical workers. 1033. No, I mean the brains? — Creative brains. 1034. Yes. I quite agree. Now, you suggest that if 15 good pictures had to be made instead of 15 quickies, these brains would not be available. Now, do you go on to say that if you and your col- leagues are making British pictures in the ordinary sense, and had to expand your operations consider- ably you would feel the same difficulty? — Yes, I have felt it continuously, that is why I slowed down. I used to make 20; one year I went out boldly and made 30, but I found I had not got the personnel, and it was a flop, and I stopped it because the creative talent was not there. 1035. Would you agree that as it is important for the quality of British-made pictures to be kept up production should not expand too quickly? Is that a corollary of what you say? — Yes, absolutely. 1036. In effect genuine British production is now working at full stretch? — It is over full stretch now, because owing to the plethora of money in the City we have had a great rush of people making pictures, mostly emigres from Germany and Austria, who have been able to get a great deal of money in the City, and they are making pictures so rapidly that I have to mark time. At the present moment I have shut my studio for three months because, as I have said, there are so many pictures being made that I am not getting enough personnel, and I have had to close down for a while. 1037. Too great encouragement for more people to go and do likewise might have had a bad effect in the long run on the British film industry, because it would mean a lot of hurriedly produced pictures which, though they were genuinely intended for features, were productions little better than quickies? — If they are hurried they cannot be better than quickies. (Mr. Eckman) : And a lot of them are un- intelngently made. Money is necessary, as we all know, to make films, but even more than money is necessary, the creative brains are necessary. As an example, in America we set out at the beginning of every season by announcing that we will make .52 pictures during the ensuing year. Now, rarely have we made more than 45, and usually it is some- where around 40, notwithstanding the fact that we maintain a personnel in our studios out in Cali- fornia consisting of some 20 producers, some 19 directors, 100 writers, 20 stars, 75 feature players, and so on, a permanent personnel in all branches of some 2,500 or 3,000 people, and we spend as much, we never spend less than £40,000 or £50,000 on a film, and occasionally it will run up to £500,000, and we find it utterly impossible to turn out more than 40 odd pictures a year. 1038. I appreciate that. Do you find, Mr. Eckman, that the field of shorts is a good training ground for brains? — No, as a matter of fact we had an associated studio that was making shorts for us, and because of the vogue for the double feature throughout the world, not only in Great Britain, it has become commercially impossible to make them, and that studio has recently converted its policy to the making of feature films also ; with the exception of outstanding shorts of which there are only two or three categories, the market for shorts throughout the world is diminishing all the time. 1039. You think, then, that the two-feature pro- grammes have come to stay? — I think so. Per- sonally I have been opposed to it for a long time, but definitely it appears, as far as one can judge at the present time, that it has come to stay. 1040. (Mr. Cameron) : Thank you. 1041. (Dr. Mallon) : Mr. Maxwell, it is important for us that we should be as clear as possible about the facts. — (Mr. Maxwell) : Yes. 1042. Have you told us that the outcome of the present system is that it leads to the renters pro- ducing or causing to be produced films about which it is not an exaggeration to say that the majority are worthless? — Yes, that is true. 1043. And have you also told us that to some extent those who produce or cause to be produced films of that kind can impose them on the exhibitor through the process, through the operation, of a verbal agree- ment?— No, I did not tell you that at all. I should say that the renters who have such quota pictures — I am speaking from my own experience — rarely attempt to impose them on the exhibitor at all. I think they are rather ashamed of the pictures them- selves, and they do not have the nerve to insist on the exhibitor taking them. If the exhibitor wants them because he is short of quota he will get them, but I have never met a case of a renter insisting on his exhibitor taking the poor pictures. What I was talking about was the big American pictures that are sometimes used as leverage to sell poorer American pictures. 1044. Yes, but has he any alternative? He has certain pictures which represent the English quota which he must set against his American pictures? — Yes? 1045. Has he any alternative but to say to the exhibitor, " If you have my good American picture you must take also these inferior British pictures "? — Of course there is an alternative. His alternative is to offer the picture to the exhibitor, and if the exhibitor does not want it he need not press it on him. His alternative is to put it on his list of pictures for sale, and if the exhibitor says, " No, I do not want it, it is not good enough," he does not insist or press it on him. Mr. Graham tells me his company hold about £100,000 a year, being the difference between what his quota pictures cost him and what he realises out of them. So it does not look as if he forced their sale. 1046. That would mean he would sell his American pictures where he could not sell quota pictures? — Yes. He will not be able to sell them for as good money, but he will sell them to some extent because there are some exhibitors who are forced to play these poor pictures in order to comply with the law. 1047. Then does not this unsatisfactory position arise, that the American renter has good American pictures and bad English pictures, and ho says to the English exhibitor, " You must take these bad pictures against the good American pictures ", or he does not sell any English pictures at all to the exhibitor? — No, his sale of quota pictures will be very limited indeed, but there is still a market, a meagre one, amongst the people who have got to take them by force majeure, as it were. I am sure the Board of Trade figures will show that the number of playdates got on "quickies" is \.r\ small. 104 COMMITTEE ON CINEMATOGRAPH FILMS 23 June, 1936.] Mr. D. E. Griffiths, Mr. S. Eckmax. Mr. J. C. Graham, Mr. J. Maxwell and Mr. F. Hill. [Continued. 1048. Looking at it from the point of view of the exhibitor, is he not, as you put it to us, in the posi- tion either that he has to take these pictures which are very bad ? — Yes? 1049. Or fail to obey the law? — No, not always. There may be other good British pictures available to him, not from that renter at all. There are many other renters who have got British pictures which may be quite satisfactory pictures. Companies like mine could not do the business we are doing in British pictures if it were that no exhibitors took them who also took American pictures from Ameri- can renters. 1050. Yes, but the quota consideration in the Act could not bo carried out? — Why not? 1051. If there; were not a substantial production of British pictures by or through American renters? — Yes, granted in some exceptional cases. 1052. I mean, you may not produce them, but they must be produced? — Yes. 1053. Then if these renters produce or cause to be produced these pictures, the exhibitor cannot avoid the dilemma which I have suggested? — No. 1054. What does he do? — As I have mentioned already, in addition to the pictures that are pro- duced for quota for American renters, which are often undesirable pictures, there are a very large number of other British pictures produced which are not produced for purposes of quota at all, and are available for exhibitors to use for purposes of quota. That is why I say that this argument about the ex- hibitor playing a lot more than the statutory per- centage is quite fallacious because he has available to him 50 per cent, more than the quota law re- quirement, and therefore he has got that extra number to work on. 1055. I think you did say that you would agree as regards certain exhibitors there was difficulty, even allowing for the fact of this 50 per cent, of surplus pictures ? — Yes, but it is not general. 1056. Yes, but that must mean, must it not, that for a great many exhibitors there is a very real difficulty in that they cannot get good quota pic- tures, and the explanation of their inability to get the number of good pictures which they require is the production of bad pictures? — Yes, but I say it h not universal, there are many cases but it is not universal. (Mr. Eckmari) : That, if I may say so, is more due to highly competitive conditions in cer- tain areas than it is to the shortage of pictures as such. In other words it is almost safe to say generally that that same exhibitor who has a diffi- culty in finding good British films has that same diffi- culty in finding good foreign films also, because he is in such a highly competitive area, probably sur- rounded by theatres that are able to wield a greater purchasing power, and he finds himself more or less left in the lurch, not only for British films but for foreign films also. 1057. Yes. Well, I wanted to get it clear and 1 think it is now clear that the system as it exists does work in this way? — (Mr. Graham,): The system as it now works is that the other half of British pictures that is made here, the British pictures not made for quota purposes and are the best pictures, take care of the quota business. Our half i.e.. those made for quota pictures, lay in the offices largely unsold and unused. 1058. I follow?— So the other half takes care of the business and they run a longer time, and this and that. (Mr. Maxwell): He means the purely quota pictures do not get distribution or much circula- tion really. (Mr. Graham) : And so you have a larger production of British films than you need have; if you made fewer pictures of better quality yen would have plenty for the exhibitor. 1059. You have told us the trouble about the pro- duction in this country is the dearth of artistic quality. Would you expect that to be lee very helpful to us. I will not take you through the first part, but I would like to go to paragraph 21. You there deal with the resistance of American distributors to British films entering the American market owing to the theatres being controlled by the major producing companies? — That is so. 1151. Could you give us any idea as to what pro- portion of the whole are constituted by these tied circuits? — Yes, Sir, I could. I have here a docu- ment called " The Motion Picture Industry Study ", which was prepared under the National Recovery Administration, and was recently presented to the Motion Picture Department at Washington. The date is stated to be February, 1936, and I find in there a table of the number of theatres in America in 1935. It is there given as 18,000 odd, but those include all kinds of motion picture theatres, in- cluding those which were closed and not being operated. The figures which I have given in the appendix to my memorandum refer only to operating theatres, about 14.. 500. Of this number of lS.L^ there are 2,073 described as belonging to " affiliated circuit theatres," that is, the theatres owned by the producing organisations, and I should say that of that 2,073 they are practically all operating. 1152. Do they have a renter in between? — They have their own renter in between ; they call them Exchanges. 1153. And the other theatres are independent, they are not linked with any renters who are in- dependent of the producers? — No, Sir. There are besides 3,070 theatres which belong to various cir- cuits, but not affiliated, mere combinations of theatres operating solely for the purpose of collective buying and collective operation, but they are not directly connected with any producer organisations. 1154. Are they combined so as to arrange dates mutually convenient or is it with a view to bringing down the price? — Well, they are simply, I think, multiple stores, if you like, under one control. 1155. It is not a matter of the theatres getting together to deal on more satisfactory terms with the renters? — No, these 3,000 odd unaffiliated circuit theatres belong to groups of anything from ten's to forty's and fifty's. 1156. Then by far the greater portion of these theatres are independent, are they, as they are here ? — Yes. 1157. And has the same difficulty arisen in America that the smaller independent groups complain that they do not get a fair deal from the renters? — It does not work in that way, Sir. These 2,000 odd affiliated theatres are in the main, and they owe their origin to it, " key " theatres, by which I mean they have been acquired as shop windows for the product of their affiliated producer organisations. Being key theatres they lead the way in every dis- trict, and pictures can only find their showing in other theatres after having passed these first theatres. It is no use trying to exploit pictures in America, as it is no use here, unless you get what we call the first runs. The first runs control the situation, and of these 2,073 theatres nearly all of them are first run houses. If we were to analyse — which I am not able to do — the whole of the first run theatres in America and ascertain how many of them are included in this 2,073 you would find that the pro- portion was an extraordinarily high one, possibly 50 per cent., I would not be surprised, I can only ^im'ss that, but a very high proportion I am certain. and therefore though there might be a number of independent first run houses in different parts of the country, they would mean nothing at all towards exploitation unless you have previously passed the first run key houses belonging to the affiliated cir- cuits, and apart from that the strength of the pro- ducer organisations in America is such that the unaffiliated circuits and other independent first runs arc mainly dependent upon the major organisations for their first runs, they must take their pictures— and therefore they get themselves tied up again by block contracts. They get themselves tied up at the beginning of the booking season. There is every possible resistance, natural resistance if you like, because their date books are already filled up, before the independent picture coming from abroad can possibly find an entry. The door is closed partly by the affiliated theatres but partly by the selling system, and more so by the selling methods employed by the American exchanges. 1158. I am very much interested to hear that, but I was not only asking with a view to seeing how it affects the export of pictures from here, I was wondering whether the position there had any bearing on the problem which is alleged to exist by some of the exhibitors here, that the small independent people cannot negotiate satisfactory bargains with the renters. What we are told here is that the policy of the renters not to allow any negotiations with groups unless they are people who have got actual financial control of each theatre has operated very harshly on the exhibitors, that there is nothing of that sort in America, the system is so entirely different? — The system is in that respect quite different. 1159. Have you any knowledge of this problem about the exhibitors? — On this side? 1160. Yes. — I think I understand the problem on this side, yes. 1161. Could you usefully tell us anything about that, whether there is any way of dealing with this grievance on the part of the smaller exhibitors? — Perhaps this statement bears on that question, my Lord. I intended to ask permission to put in a supplementary note to my evidence, a supplementary note on co-operative production by exhibitors — that is what I call it — and it is only a brief note if I may read it to you, and I will then pass it in. 1162. Certainly. — " The attention of the Committee is drawn to the following situation, and I hope they will be prepared to state their views and, if thought desirable, make recommendations upon it. "It is well known that exhibitors are deeply concerned at the rental prices they are com- pelled to pay distributors for films. Without admitting the case they make as to the excessive burden of these prices, there is some added irritation and resentment by the fact that the organised renters' policy is designed to place individual and independent exhibitors in a weaker bargaining position than in the case of competing theatres forming part of a circuit. Collective action by groups of independent exhibi- tors has become impossible owing to the attitude of the organised renters, and among other con- sequences it frequently happens, so it is alleged by exhibitors, that independent exhibitors have a much more restricted choice of pictures or are compelled to pay substantially higher sums for them than their neighbours or other opposition houses, though their theatres are smaller or have smaller earning capacity." I think that is the problem you were asking me about. " Among the devices for defeating this monopolistic tendency of the larger circuits, the suggestion has been made for the creation of a new producing and distributing company in which exhibitors would be the principal share- holders. These exhibitors would be expected to enter into binding contracts to show the films produced or acquired by the Company as and when they come on the market. The contracts would be an essential feature of the company's organisation, as the provision of finance and capital is dependent on them. " 1 have been consulted mere than once on a scheme of this kind, and 1 have always had to advise that such contracts would he in contra- vention with Part I of the present Act-. This is because their essential feature is an obligation MINUTES OF EVIDENCE 117 30 June, 1936.] Mr. S. Row son. [Continued. for future exhibition of a picture which at the date of the contract has not been made. I may be wrong in this interpretation; if so, the ques- tion is answered. But assuming I am not wrong, on a strict reading of the Act, I suggest that means might be found for making a scheme on the above lines possible. It would merely extend to a combination of exhibitors the same practice as is now carried out by producer-exhibitor organisations at the present time, .without con- tracts because these instruments are then unnecessary." 1163. You do not make any other suggestions for dealing with the difficulty of the small exhibitor. Could you 'help us in any way in that respect P What we are told is it is not a difficulty which happens in the smaller areas, but where you have a large population served hy half a dozen cinema theatres, the theatres that are the weakest have a poor time? — I think there is a difficulty sometimes, but not quite so keen, not quite so serious, as is sometimes said. It is a little bit exaggerated, but there is a certain difficulty in many crowded centres, in populated centres, but that difficulty arises mainly, I think, through the concurrent demand of a number of exhibitors for one particular picture. 1164. You see no way out? — I see no way out of it except by some help with a scheme of this kind. 1165. Well, let us come back to paragraph 26, to the position in America. Blind booking is the regular system, from what you have told us? — It is. 1166. Is there any redress if the film booked blind is not up to standard? — None whatever. 1167. They have to take it?— They book the block and they show the block. Nowadays I think they are entitled to get about 10 per cent, rejections. 1168. Oh, I see, the exhibitor may reject some of these films? — -The new contract permits them to reject 10 per cent, of their pictures in the block. 1169. I see. Then, in the same paragraph, you mention the very long period before a trade show and nine or ten months before a release. Why is there this long delay, much greater than in the case of American pictures ? — In the case of American pictures in America? 1170. No, these are the British pictures, you say that after production several weeks or months elapse ? — In this country — you mean by comparison with America? 1171. Yes, .why is it so much slower here, why is it that this long lock-up of capital takes place? — 1 think on the whole they are not so administratively efficient here. 1172. Then in paragraph 39 you suggest that the permission of blind and block booking would help in these matters. Do you think it would shorten these periods of delay? — I think that the blind and block booking provisions in the Act are; not effective, and it would make very little difference if they departed from the Statute Book at the present time. 1173. But on the other hand, the positive side, what help would it be, how would it assist in the turnover of capital? — There would be no great help in that way so long as the American film dominates the situation, and they are permitted to book their pic- tures or make arrangements for the showing of them long dates ahead. The date hook will always be full, but I think that the suggestion I have made for possibly demanding that the quota shall be fulfilled every three months, and therefore compelling the exhibitor to reserve a quota number of dates in each three months, would have a beneficial effect. 1174. That would come in the quarterly returns? — Well, there would have to be a quarterly qualifica- tion anyway. 1175. That would probably be very much resisted by the industry and add very much to the reports and the statistics?— It would add to the clerical work but I do not think that is a sufficient objection. 1176. Would there be much opposition to it. do you think? Do you see a great advantage in it? — I see an enormous advantage. 1177. Do you think the industry would agree with you and therefore not oppose it? — I do not think the industry would seriously oppose it, but I have not consulted with them about it. 1178. But you think the advantages are so great that they would overcome the difficulty? — Well, there were the same objections on the clerical side when the Act was first introduced. 1179. Then in paragraph 29 you mention the suggestion of the American interests that they should be allowed to spend more money on fewer films, and I would like to know your opinion as to the possibilities of production over here by these foreign organisations. We were told by the renters' organisa- tion that it is impossible for any individual organisation to make more than six satisfactory films in a year, therefore the necessity of making two or three times that amount makes it inevitable that the poor films should be made. Do you agree with that, that it is physically impossible for these people to control production on a larger scale? — In Hollywood the Paramount organisation makes about 70 to 80 major pictures a year under its own banner ; the Metro-Goldwyn makes .50 to 60; the Fox people make 70. 1180. But they are hampered, according to their evidence, by the lack of technical knowledge over here, the lack of personnel, and the fact that they have to comply with the requirements of 75 per cent. British, and so forth, and they allege that they cannot possibly do what is easy in America. You do not agree with that? — No, I have a good deal of sympathy with that. If they are going to make important pictures of the £50,000 or £60.000 or £100,000 grade it will call for a considerable in- crease in the present technical staff, and that technical staff is not at the moment available in this country. 1181. So that if we are going in any way to drive up the standard of pictures we shall probably have to go a bit slow over quota until things readjust themselves ?— That is my own view, Sir. 1182. If we continue with the quota which is too high a quota of British pictures, and too rigid in the enforcement of quality, the result would be that- certain American pictures would be cut out? — They might be. 1183. Would that matter very much, do you think? — Well, we can very well foresee that it is only the inferior foreign pictures that would be kept out. That would not be in general a serious matter. 1184. It would not injure British interests in any way? — No, the interests that would be affected are the interests of the exhibitor, he would not have these play dates that would have been occupied by these inferior American pictures being competed for by British pictures. The exhibitors would certainly say that they had not got enough pictures to choose from. 1185. They make that complaint about British pictures now, and they would transfer that grievance to the American pictures? — They would certainly say, and I think they would be entitled to say, that the effect would he to boost up prices for the remaining pictures on the market, whether they are foreign or British. 1186. Then in paragraph 32 you suggest that a minimum on Form C hasis should be fixed of £1 a foot, but you are willing to support a beginning at 15s. a foot. This is a good deal lower than the recommendations which have been made to us from other quarters? — I quite appreciate that, but this suggestion is directed to improving the worst pic- tures and not doing anything at all or no1 taking any account of the pictures that are already better. and 15s. a foot on Form C is supposed to be sub- stantially 30s. a foot on total costs, and a 6,000 or 7,000 footer would cost £10.000 minimum, and I do not think that the minimum would in this case become the maximum. The average would cortainh be very much higher, and I think the effect would be a psychological one. 118 COMMITTEE ON CINEMATOGRAPH FILMS 30 June, 1936.] Mr. S. Rowsox. [Continued. 1187. You are careful to dissociate yourself from the view that cost is necessarily any criterion of merit? — I quite appreciate that. 1188. But I suppose we could apply this method of cost with an appeal to some kind of independent body in the case of a cheaper picture qualifying on merit? — I have always advocated that. 1189. And in that case we can put the automatic qualification of cost considerably higher and deal with the other pictures that did not come up to that? — I have always advocated that pictures cost- ing less than the minimum should be permitted to apply for registration on the grounds that they have special merit. 1190. In that case would there be any danger in putting the automatic qualification considerably higher than you suggest here? — -There is no serious danger; only I do not think it is necessary. I think it is already a very hig increase for the people who have been spending £5,000 and £6,000 to be com- pelled to spend £11,000 and £12,000, and the fact that they are compelled to spend £11,000 and £12,000 means that they are going to give far more attention to getting worth out of their spending than they did before. 1191. The producers recommended that quota should in future be based on the percentage of foreign pictures shown, the proportion of foreign pictures shown, not on the combined percentage of the two. Personally I was not able to feel clear what was in their minds. Could you tell us whether there is any advantage in that? — I think I can. I read the evidence on that subject and I agree with you, Sir, that at first sight that is merely a mathematical dis- tinction and no real distinction. They were advocat- ing two kinds of British films, those which are necessary in order to satisfy their quota liability, and those which are made otherwise than for satisfac- tion of quota liability. The pictures that were made for satisfaction of quota liability should be in number as small as possible. You do not want that liability to be extended more than is absolutely necessary. If, for example, to take a case, 80 pictures were being imported by a particular company, you could have a liability of 25 per cent, on the 80 pictures or a liability of 20 per cent, of the 100 pictures, and the effect is precisely the same, but if the company importing those 80 pictures wanted to make 30 British pictures then you would have a total of 110, and you would have 22 subject to your minimum price liability instead of only 20. It is only when the minimum number is being made that it makes no difference, but when you are making more than your minimum it does make a difference. 1192. But there is no compulsion to bring in these foreign pictures. I could see that if it was working the other way? — There is no compulsion, but we are taking the importation of foreign pictures for granted. They are importing 80 pictures and the people who are importing them are compelled under a 20 per cent, all-over liability to find 20 more pictures of a British kind, but supposing they want to make 30 pictures, then you have got 110 pictures, and a 20 per cent, liability would represent 22 pictures subject to the conditions that you may lay down in the Statute, instead of 20. I hope that is clear. There is a difference. 1193. Yes, I see you do not want the British number to count in the basis figure? — We do not want the British number to count in determining the number of British pictures that have got to be made. 1194. Yes, I see the point now, T am afraid I did not before, but you have succeeded in enlightening me. — Thank yon. 1195. You speak in paragraph 33 about the ex- cessively high remuneration demanded by certain artists under technical personnel. Is tins due to a kind of monopoly position that the quota Act has enabled those people to enjoy? — I think it has arisen mainly, my Lord, through the desire to find sonic element in the British picture which would enable them to sell it more easily to a possible producer. Supposing you want to make a picture hoping that you might be able to sell it to an American Company. It is quite clear that you have got to find some feature in that picture which will make it accept- able for advertising purposes. It might be an American star, an English star being unknown, no matter how eminent that star may be he is of no value in America. It might be a United States Director, who, at any rate, is a guarantee to them of making a first class picture for release, and you have got to put in perhaps an American camera-man who is wrell known to the American organisations as one who is turning out excellent work. The result is that there is a pressure on American technicians and American stars and American Directors for the making of pictures, especially so far as they are permitted in the English picture to be excluded from the 75 per cent, cost qualification under Clause 27, and this successive pressure through the demand, as it were exceptional demand, for these various purposes has caused a rise in values to take place quit-e beyond the intrinsic worth of the artist or person concerned. 1196. Do you think that the 75 per cent, require- ment is reasonable or does it shut out opportunities which should be available to the British producer, opportunities of drawing on foreign resources? — Well, the only person who at the moment is ex- cluded is one star or one director, who is excludeable. 1197. Is that enough? — Well, personally, I am in- clined to the opinion that the exclusion of the star or director is no longer necessary. 1198. You think that they could get those in this country? — No, I think they ought to get it within the 25 per cent. cost. I think the 25 per cent. margin should be enough. 1199. Yes, I see? — Especially as you are going now to aim at raising the cost of the picture so that the 25 per cent, margin will, ipso facto, he repre- sented by a larger sum. 1200. Yes. Then you refer to the serious adminis- trative inefficiency. Would you care to develop that sentence ?— 'Well, I will sum it up in a piece of in- formation that was given to me which I think is of interest and perhaps you might regard it as of importance. I am not criticising the British methods, but an executive chief, one of the financial chiefs of one of the great American organisations, told we a few days ago that their last 49 pictures made in Hollywood, not an odd one, averaged 29 days on the floor, that within three to four days after the last day of shooting a copy was available for the executives to see in their theatre in Holly- wood, and within 15 or 21 days from the last day of shooting there was already a first run in New York. say under a month from the last day of shooting. Compare that with not an uncommon experience in this country. No important picture is now made within the period of 29 days, they take six to eight weeks, even when they are very smart, and they frequently take many months. After the last day of shooting it usually is many weeks before there is a copy available for the officers to see, and assuming that a trade show represents something like the earliest day when a final picture is available, it fre- quently is three or four months from the last day of shooting that a trade show takes place. Now, all those stages are controlled by administration, and I think the comparison is very much to the dis- advantage of the English administration. 1201. Have you seen any improvement in the las! few years? — Not serious, in fact 1 am not sure if it is not getting worse with big pictures. 1202. What is it. Is it that they have not got the right sort of men in the industry?— I think that is so. 1203. That they have got people of artistic tem- perament where the Americans put a business man? —I think that is so. 120-1. And does the artistic Side benefit by that in anv wav?— The artistic side is certainly benefited; MINUTES OF EVIDENCE 119 30 June, 1936.] Mr. S. Rowson. [Continued. I quite agree that the artistic side is benefited very, very much, but I am afraid at too high a cost. 1205. In paragraph 34 you say that exhibitors are demanding that the quota on exhibitors shall never exceed one-half of the corresponding renters' quota. I did not understand their evidence to be quite as definite as that. My understanding of it was that they said they were to have a choice of two pictures for every one that they had to show, and under present conditions I think they argued that that could only be done if the quota was varied in this way, but if the margin available were varied in some other way, achieved by raising the quota in some other way — I did not understand that they were com- mitted against that? — I appreciate the distinction which you are making, my Lord. They certainly did ask for a choice of one picture out of two. I think they meant at the time that that would not be satisfied unless the renters' quota were twice as high a figure as the exhibitors' quota. If all the renters' pictures were exhibited to the same number of theatres and for the same number of days then that would represent two pictures for one. If some of the renters' pictures are shown to a very much larger number of theatres than others and you improve the number of pictures of the higher grade you would be able to satisfy their condition in theory of a choice of one out of two with a fewer number of pic- tures, but the arithmetical relationship is not quite so simple as all that because of the barring clauses and the showing clauses which exist. It does not matter how good a film is, very often some exhibitors cannot buy it, or they will not buy it, because it has been shown by an opposition house. 1206. Then you refer to films being available to exhibitors whenever they were registered. Now, in fact, is it often practicable to revive old films and show them again ? — I would not depend on it too much according to existing practice. There are several theatres, but they are very few, where they can show old films, but I would not depend too much on re-issues, as we call them. 1207. You suggest a scale of quota. Do you think that it is wise to look so far ahead. Do you prefer a rigid law to leaving discretion to the Board of Trade, acting on advice ? — This is only a formula. 1208. I know, but would you prefer a formula, whatever may be the figures with which you fill it up, would you prefer a formula in advance like this to leaving certain discretion to the Board of Trade acting on the advice of some impartial body, some- thing like the Import Duties Advisory Committee? — I have the greatest respect for the Board of Trade in the administration of this particular Act, where I have had a lot of experience and contact with them. I think it would be throwing a very heavy burden on them if you are going to give them a dis- cretionary power to decide say in five years time what the quota should be for the sixth year and the seventh year. I think it is necessary from the point of view of the trade itself that they should know precisely what they have got to face in two or three years time ahead. 1209. Forcing up the quality will dislocate pro- duction considerably and it would be very difficult to fix these things? — That is why I am very loath to make the figure too high at the start. 1210. Yes. Then in paragraph 36 you recommend that registration of films should be extended to cover all short subjects except newsreels, advertising and industrial films. If you could ensure that advertise- ments were eliminated there would you feel it un- desirable to allow industrial films to be registered? — If they are not subsidised I have no objection. 1211. With those reservations you do not object? — I think some industrial films are extremely interest- ing, if they are not subsidised. 1212. Then you recommend the deficiency on short quota should be transferred to long quota at the rate of one foot to every two or three feet. Why do you recommend that there should be a different value for the long quota from the short quota? — I think we have got ourselves into a frightful mess by assuming that short films are similar to long films. I think that was the mistake that we made in the original Act. We defined registrable films for shorts as the same thing as registrable films for longs. 1213. You want to get rid of that distinction? — I want to distinguish between the two and there are two different kinds of business. 1214. Give them incentive to use different kinds and work up the quota in that way? — -To the de- velopment of the short. 1215. This reciprocity scheme is new to me here. I do not see what security we should get under this when British pictures were shown in this country. It would inevitably have a big effect in reducing quota if it were successful. Well, that would be what we want in the American market, but from the point of view of the original policy of getting pictures shown in this country it seems to me it might fail? — I think not, Sir, because, ex hypothesi, such an arrangement could not be made with any American company unless they were high quality British pictures, and high quality pictures will find their level in this country without any difficulty whatever, without any compulsion for exhibitors to show them. 1216. You think the quota would still continue for a large area, it would only be exceptional that you would get this very limited market? — I hope per- sonally they would almost become extinguished. 1217. You think they would? — I hope so, I do not think they will. 1218. But I suppose there are certain subjects which are suitable for pictures here and which in no circumstances could be treated in such a way as would interest an American organisation? — I think that is extremely probable. I think the Americans have made a mistake sometimes in forcing some of their pictures on our market, like baseball pictures and football pictures, which nobody here can under- stand. 1219. Under a reciprocity arrangement the picture in the home market would have to receive the quota arrangement? — They may be the terms r^ the con- tract which I suggest would have to be reviewed by a competent body here before they were entitled to call upon the Board of Trade or before the Board of Trade would be entitled to say, " We can lift the registration on these films." 1220. Yes. Then at the end you refer to the lack of capital in the industry. Has inefficiency got much bearing on this difficulty. Is it conceivable that you could so improve efficiency that you could get better work out of the same capitalisation? — One might assume that with increased efficiency there would be more Companies and more productions showing a profit return than at present. 1221. You say you are clear in your own mind that the amount of quota should be definitely related to the actual capital invested and employed, not including any loan money. How would you relate it administratively? — I do not know. I hope you do not ask me for a hard and fast formula. I do not know what the output value of pictures this last year has been, I am inclined to think from some figures I have heard that they have been very much exaggerated before you. I will go into that if you care for me to do so, but suppose the amount of capital being used at the present time in the pro- duction of pictures is £2 million, and they are using in addition another £2 million of short date loan capital, I would be inclined to ignore the £2 million of loan capital and ascertain what would be a fair quota liability to relate to the £2 million. If at any time there should be a transfer from the loan capital of £2 million so that there was only £1 million of loan capital, and £1 million increase in share capital, then I would be inclined to favour 120 COMMITTEE ON CINEMATOGRAPH FILMS 30 June, 1936.] Mr. S. Rowson. [Continued. an increase of quota on the basis of an increase of £2 million to £3 million. 1222. Well, we cannot foresee that at this stage? — I know we cannot. 1223. And if there is to he an Act with a schedule such as you suggest ? — I am afraid we could not draft it. 1224. iWe have got to give up the idea? — I think so. 1225. It is desirable, but you do not quite see how you could do it. Thank you very much. 1226. (Sir Arnold Wilson) : My Lord Chairman, I feel sure I voice the opinion of the whole Com- mittee, both those present and those absent, when I say we are greatly indebted to Mr. Rowson both for this evidence and for the paper which he prepared for the Royal Statistical Society which gives more information to us than any publication that I know, whether official or unofficial. — Thank you, Sir. 1227. Our Chairman has taken you through your evidence with such lucidity that I do not propose to offer further questions at any length to you. The memorandum is to a great extent self-explanatory, and many of the questions that you have posed to us you have answered yourself in the process. — I thought that would be more helpful in doing it in that way. 1228. Yes, indeed it is. Assuming for the sake of argument, simply for the sake of argument, that every proposal made by you in paragraph 28 were to be adopted forthwith as the declared policy of Government, do you think it would be possible in practice for the Board of Trade to act as the arbiter and the interpreter of an Act of Parliamnet giving effect to your ideas. Would it not be necessary to establish a cinema industry control board in some form to take over responsibility both on behalf of the Government and of the industry at large, to give effect to the policy which you have outlined which is, to a great extent, only an extension of the policy laid down by the Act of 1927? — I certainly have never given any thought to the suggestion which you have just made, Sir Arnold. I think it is a very interesting suggestion, and I realise that while on the one hand the Board of Trade has proved exceedingly efficient in administering an Act relating to a very complicated business, such a board as you are suggesting might be of very great added value. 1229. You appreciate that the general policy of Government for many years past has been to en- deavour to co-operate with industry by means of boards rather than to exercise executive authority when large commercial interests are involved? — I do appreciate that, Sir. 1230. We have parallels, for example, in the Sugar Reorganisation Commission, the Milk Marketing Board, the Import Duties Advisory Board, the Elec- tricity Commissioners, each with a very different ad hoc constitution, devised to enable Government to rely upon the deliberate consideration of a body of men who are not impartial in the sense that they are disinterested, but who are genuinely anxious to give effect to the declared policy of Government and to enlist the active co-operation of all those com- mercially interested in their particular branch of industry? — I think that is so, Sir, and, if I may say so, that was one of the objects which were aimed at in America by the N.R.A. An actual code, among others, was already drawn up for the film industry, among others, which, of course, had to be cancelled when the N.R.A. went by the board, but the code was already in existence and there would have been a code authority, of course, which I understand was the kind of thing you had in mind. 1231. At a later date, my Lord, I shall ask you to provide us with copies, if possible, of the N.R.A. code? — The reference, Mr. Patterson, is Motion Picture Industry Study Work Materials No. 34. 1232. I am anxious to hear a little more from you on the subject of the shortage of capital. It has been suggested to us last week bhat there is a plethora at the moment of short money coming into the industry and that industrial assurance companies and others have freely and not always wisely in- vested money in the industry, thus encouraging the production of films to a point beyond that at which the industry really is competent to envisage? — I believe that that is a statement that I am prepared to endorse. I think there has been a very consider- able amount of City money coming in, short date money which has become a very heavy burden on the pictures — I use the word instead of companies — the pictures for which that money has been provided. I think if the Committee were to call for a return from the Board of Trade Companies Department of the amount of short date loans which have had to be registered at Somerset House because they have been charged on particular properties during the last year or two, I believe the result would be rather surprising in the film business. It might be a laborious piece of research, but it might be extremely instructive on this point. 1233. Would that cover the growing practice of procuring an insurance policy at Lloyds on an over- draft with a bank? — I imagine so, yes, certainly, because the system as I understand it is this : that an Underwriter at Lloyds undertakes to provide an insurance policy to guarantee an overdraft, and the bank provides that overdraft subject to that guarantee with a charge either by the bank or by the original guarantors on a specific asset, the picture in question, or on the companies which are responsible for making that picture. 1234. I am familiar with one-ship companies, but have we got one-picture companies? — Oh, yes. I do know of companies that have made one picture and have gone out of existence. 1235. And those are registered at Somerset House? — As soon as they are charged they must be registered. 1236. An enquiry covering two years would suffice ? — An enquiry covering two years I think would show a very interesting piece of information. I have found it too heavy to do myself, I was wanting to do it but it was much too heavy a task for myself to undertake. 1237. (Chairman) : Have Somerset House got all this dissected out? — No. You would have to make a list of all the production companies that are known and then analyse the charges which have been registered and satisfied in each year. 1238. (Sir Arnold Wilson): If we had a British Cinema Industry Control Board such as I have suggested it would be possible for them whether by statutory Rules or Order or otherwise to regulate the amount of capital that came into the industry and thus \o ensure that so far as they were con- cerned there was at least not a plethora, although they could not guarantee a sufficiency? — Sir Arnold, this is a new thought, as they say in America, and I am not prepared to answer it right away. I should like to have an opportunity of thinking of the implications and the functions of such a Control Board before I can see whether it could have any influence on capital. The administration I under- stand, but whether it could influence capital except in so far as it produced a better atmosphere in the film business, I do not know. 1239. I will turn to another point. You referred to the relative inefficiency of the cinema industry in regard to its administration. As I understand it what is required to make any productive industry efficient is a planned schedule as accurate as that which is prepared by a builder when a large build- ing is going up. when the actual quantities and personnel for every stage is worked out to within a Few hours day by day for everyone of the thirty or forty sub-contractors and sometimes more employed on a, building. They have their actual .laic-, hours and positions allotted to them in advance, and the arrivals of material are also scheduled so carefully that barring accidents there is no possibility oi con- gestion of ''ricks or of mortar, of steel or of ancillary materials coming in. Now. that is only possible in MINUTES OF EVIDENCE 121 30 June, 1936.] Mr. S. Row son. [Continued. the cinema industry if blind and block bookings are allowed. Is not the difficulty of getting firm advance bookings to which you have already alluded one of the major causes of administrative inefficiency in the British cinema industry itself? — I agree that ad- ministrative efficiency pre-supposes a planned schedule, but the analogy to a building schedule can, I think, be drawn too closely. After all when you have planned your building in all its details the actual work is not an artistic job as it were, brick laying requires expertness but not artistry. Laying stones, and so on, requires expertness but not artistry. But after all, when you have planned a picture and are beginning to make the equivalent of the building in bricks, the shots which you take on the floor, there the major artistry comes in, and there you are introducing a new quality which tends to disturb your estimates that you have been basing yourselves on. But subject to that one reservation, and I think it is only there, that the question of artistry comes in and may upset your calculations, I agree that the fullest details should be prepared, the budget should be prepared in the very closest detail, and, as a matter of fact they are. The trouble is that they are not adhered to. 1240. You do not think an absence of certain guaranteed dates for exhibition for the film when complete is one of the major causes? — No. The absence of guaranteed dates is, I think, a con- tributory to the very much larger amount of capital required to run an English production business. But beyond that I do not think it means very much. 1241. If a market gardener knows that tomatoes will be ready, that the grocers are ready to take them in a given week, he has every inducement to plan his production to meet demands ; but if there is no assured purchaser, and the only market is Covent Garden, he may allow production schedules to take second place in his mind? — I agree. But we do not control the whole film supply here. We never can get over the primary condition that the market is first of all supplied from America, which by no conceivable possibility do we control. They are made for the American market, and all the pictures being re- corded in the same kind of language, or a language that we understand, come here and are shown. They are booked, and they are always formally booked, but an arrangement is made by which they have a guaranteed release at various theatres all over the country. The existence of those pictures which provides the exhibitor with a guarantee that he is not going to have much trouble during the year with his supply of pictures is such an induce- ment that he is tempted to fill up his dates with these proposals. I will put it no higher, and the abolition of blind booking and block booking would not affect, I believe, that situation very materially unless the British pictures were in number and quality competitive in attraction value to these American pictures. 1242. That brings me back to one point of finance. Is most of the capital now provided on a basis of a fixed charge, or does it participate in profits? — I think, so far as I know, most of it is a fixed charge without any participation, most of it. That is not the German system. It is not the Ameri- can system, where loan money is provided, but in England most of the loan money is provided at a fixed rate. You pay so much for your insurance policy and so much for your overdraft. 1243. Which would you prefer as a procedure, a participation? — I would rather give participation always, a participation in profits. 1244. The dead weight would be relatively less? — If I borrowed £20,000 I have not much more than £18,000 or £17,000 available, and that £3,000 differ- ence from £17,000 to £20.000 is the amount which is at greatest risk. 1245. With regard to the difficulty of obtaining really competent artists and technicians, I gather that the difficulty is at least as great in regard to technicians for directing management as with regard to artists, is there any system of training, any school or academy? — Well nothing of any real importance, of any real value. My own Society, I think it was at my suggestion, was instrumental in starting a course at the Regent Polytechnic in connection with cinematography that has been running for three years with increasing success, but it ran never hope to provide more than the junior technicians. 1246. Is it inconceivable that the industry in this country itself, if there were to be some organisation, some unification of the industry, could it not set up a school, a series of technical schools or one technical school which would cover the whole gamut? — I see no reason why there should not be, for example, Chairs in some of the Universities as there are in America. Here is one example, a book by Professor Howard Lewis, who is extraordinarily competent and in- forming on the whole economy and technique of motion pictures. That deals with the economic side, if you like, but there is no reason why there should not be a Faculty in some University of motion picture art. 1247. I have a natural bias myself against in- cluding purely vocational training, technical training, in the scope of the University. But there is no reason why a school should not be established, as in many industries for the purpose of training personnel. The London School of Printing is famous throughout the world and has had a profound effect upon print- ing. It is supported, directed, and encouraged by the industry itself without as far as I know any assistance whatever from the Government; it has raised the whole standard of printing and has been of immense benefit to the printing industry as a whole, and it covers every aspect of printing from the study of paper to the technique of binding and the whole history both of the making and casting of type and the study of layout. As a member for some 'years of the Examining Body of the London City and Guilds Institute, I know of courses established by at least forty to fifty of the major trades in this country laying down what is required before a man can become a competent butcher, baker, or candlestick maker. The County Councils as far as I know do not finance these special schools ? — There is the Manchester School of Technology which is practically a University School. 1248. Yes another Cloth Workers' Company have founded a most elaborate and exceedingly valuable technical institution. Is there anything of that sort at all in the film industry? — I hope it will lie possible, and pari passu at any rate with such a Control Board as you have outlined it may be contemplated. 1249. Is it not implicit in your memorandum to suggest that artistic talent is inborn and inherent, and not an acquired characteristic? With cinema stars the creative faculty is born and not made? — ■ I think they are more made than horn. They are made by the advertising, very often. 1250. And if we had some organisation devoted to it in all its branches, you would build up before very long a school of thought as well as of action which might have very important effect on the cultural growth and would by no means exclude the humourous side which is, to my mind, I freely con- fess, of greater value than all the rest put together. The depressing surroundings of our industrial cities require as much as we can get of the brightest humour, and I am by no means a killjoy? — 1 agree; T think it is extremely possible and desirable that a future such as you have outlined should be possible. 1251. You are familiar with the origin of the Russian Ballet? — I am not. 1252. Which started with a school of ballet dancing established by royal patronage to which selected children were sent at an early age to be instructed in every possible aspect, whilst being educated at the same time, and one of the world's joys was created, deliberately created by a process ol intensive education. Is it possible in your judgment to hope for such a development in this infant industry? — I say it is not impossible. 122 COMMITTEE ON CINEMATOGRAPH FILMS 30 June, 1936.] Mr. S. Rowsox. [Continued. 1253. But there is nothing of the sort at pre-eni r — Nothing whatever. 1254. And as far as you know there has been nothing envisaged? — I have never come across it at all. 1255. I see you carry a book upon the subject from America? — I came across this only a few days ago. 1256. What is the date of it?— 1933. 1257. Is there any such organised activity in the educational side in the United States? — Oh, yes — no, there are, of course, one or two Chairs at Har- vard and places of that kind; I think there is one at Columbia, Chairs of motion picture work, and then there is the Academy of Motion Picture Art and Science at Hollywood. It is financed by Holly- wood, and is fairly independent as such bodies go in America. It covers mainly technical, but also artistic. I do not think it does any education work, but it is prepared to do any examining, if you like to call it that, the examining of the attainments of various classes of technicians. 1258. How is it regarded by the film idustry at large? — Fairly well. Those who manage to get its diplomas each year are very pleased with them. 1259. That is not a reply to my question? — I could not put it any higher than that. I think it is a fairly competent body. 1260. There is only one more point I want to raise, and that deals with recommendation 5 of your twenty-eighth paragraph: — "The present insistence that the scenario writer must be of British nationality should be withdrawn." Why do you single out the scenario writer? — It is the only one that the Statute insists upon as a sine qua non for a British film, the only one of the technicians. 1261. I agree it is scarcely consistent with a generally very liberal outlook in this country to insist on British nationality, which is by no means a qualification either of competence, intelligence, or anything else. British nationality is unfortunately exceedingly easy to acquire ; scores of thousands of undesirable persons have had British people as their fathers and grandfathers, and their number is daily added to, as the birthrate shows. But would yon be inclined to leave that to the unfettered choice of the production managers? — Well, another reason. Sir Arnold, that I have suggested the cancellation of this provision is the point that since 1927 the term scenarist has become far more vague in its content. At that time the scenarist was a fairly easily de- finable person. Nowadays the scenario is a com- bination of the ideas and the writings and thoughts of a considerable number of people, and I do not know who is the scenarist. 1262. It is of no more significance than the editor of a great newspaper, who gives a certain outlook and decides the outlook of the paper, but is not ? — I am not sure he is even that, the scenarist nowa- days. 1263. Who is the scenario writer when one of Shakespeare's plays is converted into a film? — That is a very interesting question. I do not know who did it in this particular case, but the work consiste 1 in preparing the scours in such a form, in such a sequence, that the camera-man and the director could shoot it in that form and then join it up in that sequence. 1264. It has no special significance when you are dramatising a great play? — Not if you are following fairly closely. It requires an expert knowledge of what is shootable and the number of shots into which a scene should be broken up. 1265. Tf you take an Edgar Wallace novel and convert it into a film, Edgar Wallace is not the scenario writer? — He is not. 1266. He is the story writer?— He is not the scenario writer, but take any recent production coming from Hollywood, say the " Pasteur " picture. which I saw the other day. There are several nam on it. Tin- person who wrote the stor? and the person who wrote the continuity, which is •! different thing. They do not usually indicate tin* person who wrote the treatment, but the person who wrote the dialogue is mentioned frequently nowadays since id has come. 1267. The scenario writer ceases to have im- portance as an individual? — As an individual. 1268. Thank you, Sir. 1269. {Mr. Cameron): I would like to associate myself with what Sir Arnold Wilson has said on this memorandum, and I have very few questions to ask because the ground has been so well covered. There is just one general point, Mr. Rowson. You have very properly mentioned at the beginning the interest of the general public, with which I feel very much concerned as a member of that public. I take it that it is your view if these particular recom- mendations were translated into law, it would com- bine our two aims, providing a maximum of pro- tection for an important industry and at the same time securing that expansion would not be so rapid that quality would suffer? — If I thought the public were not going to get better pictures, I would not be advocating these proposals. Whether these pro- posals will secure it is another matter, but my belief is they will improve the quality of pictures. 1270. And it will be the right combination of those two processes? — I think it will be a combination which will prevent somebody exploiting the public rather than selling something of value. 1271. Quite. And you contemplate that there will always be pictures deliberately produced as serious pictures, but as second feature pictures? — I con- template a future when there might be some pictures being made at considerable cost because of an arrangement which exists that will provide for those pictures a market outside England. There will besides always be some less costly pictures which will not aim " at the stars " but which will bo interesting enough and entertaining enough to British audiences to fulfil the function not merely of a second feature but also in many cases of first features. 1272. Having particularly British characteristics? —Yes, an English cricket or football picture obviously could be made to appeal to English audiences where they would not appeal to any foreign audiences, and that is an added attraction and makes up for the deficiency of foreign revenue which such a picture would not be getting. 1273. Your cardinal point of principle is that the British film industry will only in its major pictures get real prestige such as is necessary for its expan- sion when it has a sufficient link-up, financial and administrative, with the American companies to ensure the entrance of British films into America, and consequently the wider market for the British products which justifies a larger cost on production? — That is my cardinal principle, we must look for world markets which in this case is Anglo-Ameri. an markets because of the English language. 1274. One small point of detail. I did not under- stand what you meant by the transfer of short quota to long. It seems to me that might defeat its own ends, might it not?— I do not think so really. You take a company which has 50 foreign shorts with perhaps an average of 800 feet. There is 40.000 foot of foreign shorts. The quota, we will suppose, com- puted on the basis of the foreign length is 25 per cent. That means that company has to provide 10.000 feet of British shorts. It has a very moat inducement to provide 10,000 feet of British shorts. be, lUse if i! does not provide them it will have to provide 5.000 feet of BriiM, longs at a very much higher cost, and in order to escape that particularly heavy burden it will use its best efforts to satisfy itself if possible with the production of shorts, especially as in order to induce it 1 am prepared to have no cost qualification on short v. ! '",'■">. Would you bo definitely against a cost quali- fication for English quota shorts?— T think it would discourage. First of all. I do not know what is a fair cost to apply to British shorts in order to encourage thorn. The range of subject is so wide that I do not think it is at all necessary. 1 think if they MINUTES OF EVIDENCE 123 30 June, 1936.] Mr. S. Rowson. [Continued. be put into competition with one another they will make the best value they can get. If you have the cost qualification you will necessarily be creating a selling price for them which will incur the exhibitors' resistance. There is already sufficient resistance. Personally, I am prepared to recast my suggestions about shorts and to say that possibly no solution of the shorts problem can be found unless you start from the exhibitor end. If you create a market there, if you are going to insist that they must show some shorts during the year, then you will be creating a demand for British shorts. 1276. At the moment you are actually contemplat- ing the continuance of the two feature programme? — There is no sign of it being relaxed. It has been increasing in America. I think I saw the other day 50 per cent, of the programmes in America are two feature programmes, which is an enormous propor- tion, and I suppose something like the same figure applies to this country. 1277. One more point. In paragraph 29 (the Chair- man already raised this point) you criticise unfavour- ably a suggestion that any renter under liability to provide 100,000 feet of British film now costing £100.000 should be permitted to spend this £100.000 on British films. You say, why did they not make worth while films before? As I understand it, their answer is that they as renters without a producing organisation over here such as their parent com- panies have in America are expected to produce a programme of British films qualifying for quota which it would be quite impossible for them to make were they to try to do it seriously? — Well, the Act told them they had to acquire or make. 1278. Yes? — British renters were in precisely the same position. British renters either made them- selves or they acquired from others. 1279. Yes? — There is no comparison between the pictures which the British renters acquired from other independent organisations and the pictures which the American companies acquired. Instead of that the American companies appear to have ordered pictures not to be as good as possible but to cost not more than £4,000 to £5,000. 1280. But then, as I understand their case, they reply to that : that is all very well, but the com- panies making and producing solely British films will handle them from their own renting organisation-, and we cannot acquire films produced seriously by British companies. They must have them produced for themselves, and that if they were to order that footage of seriously made films in addition to the pro- duction of the big producing English companies it would create a situation which would impose an intolerable strain on studio organisations and would be impossible? — I do not think there is anything in that. 1281. You do not?— No. 1282. That is their case?— That is the case they make, but I do not think there is any substance in it at all. 1283. You mean the pictures could have been pro- duced if they had wanted to acquire them ? — Certainly. 1284. If it had been a gradual development? — If it had been a gradual development. 1285. You could not suddenly do it now? — They started with 1\ per cent, quota. 1286. And had they started then it could have been done? — And had they started then it could have been done, and it would have helped enor- mously in helping to produce pictures in this market that were not derisory. 1287. If it were suddenly tried now it would be impossible. It is a different thing altogether? — It is a different thing altogether. Twenty per cent, or 15 per cent, is a very big burden. Fifteen per cent. is making eight to ten pictures, and if they cost £40.000 an adventure of £400,000 output in a year is a considerable one. 1288. Your solution is slightly to lower the quota and to raise the qualifying cost clause, but not to a point that necessitates really big production for all those pictures? — The figure of 15 per cent, sug- gested to replace the present is in the expectation that the reduced liability for pictures will cost at least as much as the old liability of pictures on account of the boosting up of the individual cost. 1289. You would not put the individual cost up so far and so quickly as to impose an impossible strain? — On technicians and on finance, those are the two conditions. 1290. But you woidd contemplate that rising? — Slow steady rising. 1291. Thank you very much. 1292. (The Hon. Eleanor Plumer) : I have really very little left to ask. In that note you put in at the beginning about the K.R.S. booking policy, your scheme would give the exhibitors, would it not, the bargaining power which they feel they need? — That is right. 1293. It would tend to form a monopoly? — I do not think there would be any monopoly. In America — it does not exist now — -the biggest stimulus to pro- duction took place when this scheme was adopted in 1921-22. It is called the First National Scheme, and was the origin of the First National Company. It does not exist now in the same form, but it did give a big fillip to production. It exists in Germany in a different form, where the exhibitors do combine together to make quite a considerable number of their own pictures, but could not do it here if they wanted to, and that is why I make the suggestion they might be able to do so. 1294. I know you have always stood for the bring- ing together of the three sections of the industry. Do you think this would lead towards it, or tend to cause further division? — It would not have any effect one way or another in itself ; but it would tend to equalise the collective bargaining conditions among independent exhibitors from which they are deprived at the present time and it would be a useful and desirable help to them. 1295. Do you envisage counter action on the part of renters which would nullify that? — I do not think so. Pardon me, I think I have been too hasty in making that reply. I should think they would hesi- tate to come out in open hostility to a policy which is expressly sanctioned by law. 1296. In paragraph 9 you speak of the margin of attractiveness of British films diminishing. What is the reason for that? — I think it is the American pictures are getting very much better. There was a period three years ago when there was a good deal of anxiety about the quality of certain groups of pictures, and they were not as good as they have since become. The American pictures have increased so much in attractiveness in the last three years that they are doing better for themselves than they did before and reducing the margin between themselves in " showing " returns and the British pictures. 1297. But there has been an improvement in British pictures? — But not nearly so quick. Any improvement in American pictures tells far more strongly in their favour because of their dominant position. 1298. In paragraph 22 you make a very important suggestion about access to the American market. How would that be affected by these new deals recently entered into, for instance the British syndi- cate which has concluded direct buying to American Universal Corporation. Does that affect the situa- tion at all? — I hope it will. It is a first move of a substantial kind that has taken place. There have been talks of similar arrangements in the past, but they have never materialised. The effect of that collaboration between an English company and the Universal Company of America is, I presume, certain to have the effect that a number of British pictures, the better ones, made under the auspices of the English company will find their way to the Universal Exchanges and will be exploited by them. It will have the effect also of encouraging an ex- change of personnel, or not so much that as the loan of the best American personnel, stars and directors and other technicians, and to that extent it is in 124 COMMITTEE ON CINEMATOGRAPH FILMS 30 June, 1936.] Mr. S. Row sox. [Continued. the direction in which I am suggesting that this should take place. 1299. And do you think it is likely to be a prelude to further developments along the same lines? — What has happened there, Miss Plumer, is that an English company in order to acquire that has invested capital in an American Company. 1300. Is that how it has been done? — Yes, they bought a quarter interest in the American company. 1301. It is not the same scheme as you suggest? — It is not quite the same scheme, but the result might be the same. 1302. Is that the sort of scheme that might be developed by other companies? — Oh, no, it is not possible of development with other companies at all. Take any of them we can name, Paramount, Warner Brothers, Metro Goldwyn Mayer, they are not for sale and nobody could invest with them and nobody could make a contract with them. It happened that Universal was for sale. 1303. It does actually bring about something of what you advocated? — Oh yes, in the eventual re- sult certainly. 1304. But it is an exceptional method? — It was an exceptional opportunity that was taken advantage of by an English company. 1305. Thank you, that is all. 1306. (Chairman): Miss Plumer drew attention to a passage which I myself have missed, and which did surprise me, and encouraged me on reading it, that British films have been superior in your opinion to American films? — In their attractiveness. 1307. Yes. — For some reason or other the statistics seem to me to point to the fact that they have been showing more times in this country than the American pictures. 1308. We are told by other witnesses that audiences in some districts will not sit through a British film. What is the explanation? — It is true in some districts. There are so many British films that are not good. 1309. Are they chiefly films obtained by American renter organisations? If we can eliminate their pro- duction of quickies, do you think we can get over this? — It would get over that kind of film certainly, tlic inferior film would tend to disappear. 1310. The major factor of the production of these inferior films is American? — Unquestionably. On that, Sir, I wonder whether you would permit me before I go, unless you would prefer me not to deal with it, but there were some questions which I read in the evidence published a few days ago about the conceivable possibility of dispensing with the renters' quota. 1311. We will be very glad to hear what you have to say? — " Questions have been raised about the possibility of eliminating the renters' quota from any future quota scheme. The mere suggestion of such "a possibility seems to me of such im- portance that I welcome the opportunity of stating my views on it. "All sections in the trade have hitherto regarded the exhibitors' and renters' quota as essentially ' linked ' — the presence of one implying the necessary presence of the other. The only questions on this subject that have ever been discussed have been the conditions to be attached to the respective obligations. Some exhibitors have advocated the lifting of the exhibitors' quota altogether, but the C.E.A. on behalf of its members has refused to endorse this suggestion. They have formally proposed that the ' quota ' obligation on exhibitors should be continued; but this proposal was made when it was assumed, sine qua. non, that the renters' quota would be also continued. T can visualise a vociferous claim for simultaneous exemption if it was decided to end renters quota. "In my opinion the ' linked ' quota mu t, for many years to come, form an integral part of any scheme designed to aid the production and screening of British films. The time has not yet arrived when either the renters' or the ex- hibitors' quota can be dispensed with. Only when British films can compare favourably, both in quality and price, with the competing American product can the ' quota ' be lifted, and then it would have to be lifted simultaneously from both renter and exhibitor. "The British 'long' films registered in 1935 were as follow (taken from Minutes of Evidence p. 28). Major British Renters. Producer-Exhibitor companies ... 46 Others 34 Other British renters ... ... 6 United Artists ... ... 8 Other Foreign-Controlled Renters ... 89 183 " Clearly the first effect of lifting ' renters' quota. ' would be the non-production of the 89 pictures by ' other foreign-controlled renters.' The cost of these must have been about £600,000. and it may be assumed that the finance for these was wholly provided by the renters. Some of these were produced by special production units in studios leased by them (e.g. Warners and Fox). In the main, however, independent production units were given contracts for the production of these quota pictures. It is notorious that in these cases the productions were exploited at considerable loss to the renters ; and therefore in the circumstances contemplated the production of these pictures would certainly be discontinued. " Even if we assume the remaining pictures will continue to be made, there would be a shortage of 89 pictures unless the British manufacturers increase their programmes to make good this shortage. In its entirety this would involve a transfer of more than £1.000.000 of productions (having regard to the more costly productions contemplated) which would have to be financed by other than the American companies. I believe the producer-exhibitor companies would be un- willing to do so. One of these companies is already producing up to its technical capacities, and the other has declared its reluctance to make more pictures than is absolutely necessary. Some of the remaining producing companies might be willing to increase their programmes if they could solve the finance problem which, in existing conditions, would probably be found difficult. " In addition to the foregoing, mention should be made that over 30 of the British pictures registered by the British renters were required to satisfy their own quota liability for foreign pictures registered by them. It is not unreason- able to assume that some of these would not be made if the ' quota ' was lifted. These 30 pictures probably represent an expenditure of £400.000 to £500.000. "The only solution therefore is the maintenance of the existing volume of production under con- ditions which must give an improvement in general quality. The renters concerned would be able to provide any additional finance that wotild be necessary ". 1312. We are very glad indeed to have that on the note. 1313. (Mr. Cameron): Mr. Rowson. you said you were rather doubtful about some figures that have been given to us? — I think the figure I have in mind is the estimate of the total production output of the country. Si millions. T think was given, and that was said to be not the whole lot. That was produced by the Federation of British Industries. I am aware, of course, of the fact that the Depart- ment put in a figure of 2* million or thereabouts on MINUTES OF EVIDENCE 125 30 June, 1936.] Mr. S. Rowson. [Contin u,ed. Form C basis calculations. I somehow find myself quite unable to accept those figures, especially the 5j millions. I will tell you why. 1 have for some years had to make some estimate at the end of the year on the remittances abroad. In connection with that I have always had to make an estimate first of the total amount of money paid into the box offices of all the cinemas in the country, and an estimate of all the money paid out of the box offices for films to the various renters, and I am satisfied that the order of magnitude of the total film bill in the country is of the order of £12 millions out of the 35 to. 37 or whatever it is representing the total payments into the box offices. Now out of this £12 millions there are first of all the distributors ex- penses to be paid which at 20 per cent, would bring it down to £9,600,000, and there are prints and advertising to be paid out of that which would at least amount to another million or so, much more. And out of that there is the British newsreel to be paid for, and there is then left a total fund of the order of perhaps £8 millions, or even £8J millions for the payments to America and the payments for British films. Now, we know that the payments to America are of the order of £6 millions, £6j millions. If you care to see it the method by which that calculation is made is contained in a paper which 1 communicated to the British Association 18 months ago. I think the Department has copies, but it is here. Now if we pay £6 millions out of £8i millions to America there is only left £2^ millions or there- abouts for British films, and I cannot conceive the possibility of producing £5 millions and only getting £2i millions. I understand, of course, the margin may be made up to a small extent by loan money, but this goes on each year and there is no prospect of the year's output being so large, there is no prospect of the revenue from the year's output pro- ducing anything like the cost. Unless they are working on a very heavy loss basis, which I am not prepared to say. 1314. (Chairman) : We shall be very glad to have this monograph if we may. The members of the Committee have expressed to you our debt for the very instructive and lucid evidence which you have prepared for us. — Thank you very much. Sir. (The Witness withdrew.) APPENDIX. Table I. Comparison of Exhibitors'' and Renters' Returns of Registered Films. Year. 1932 1933 1934 1935 Length of " Long " Films Regis- tered in Years ending 31st March. Footage of " Lon g " Films Exhibited in years ending 30th September. Amount (in million feet). Amount (in thousand million feet). Average number of times screened. Foreign. British. Foreign. British. Foreign. British. 2-96 3-06 3-12 3-12 0-93 0-96 1-18 1-18 21-49 22.20 23-21 24-09 6 89 7-90 9-22 9-41 7,260 7,250 7,440 7,720 7,410 8,230 7,810 7,970 Table II. Population ... Population aged 15 and over Admissions p. a. Average p. a. per population Average p. a. aged 15 and over Seats in cinemas ('000) Cinemas Average size of cinemas Population per seat Population aged over 15 and over per seat Population per cinema Population (aged 15 and over) per cinema (millions) U.S.A. 127 89-7 3,700 29 41 10,000* 14,501 700 13 9 s.st in 6.200 Great Britain. 45 34-3 963 21 28 3,872 4.3< 15 900 11.6 9 10,500 S.OOI) Estimated for cinemas open and wired for sound. 37873 26 COMMITTEE ON CINEMATOGRAPH FILMS 30 June, 1936.] [Continued. Table III. Theatres {and estimated seats) in the British Empire showing English-speaking films at the end of 1934. Great Britain Ireland Canada Australia New Zealand India Ceylon Malay States South Africa Bermudas Trinidad Country, Theatres. ?,945 Seats. 4,305 3,872,000 400 160,000 862 528,000 1,334 650,000 435 140,000 308 110.000 18 7,000 57 35,000 200 80,000 9 4.000 17 7.000 5,593,000 Table IV. Number of stages " in operation " and " building " in and near London at end of May, 1936. Name of Company. In operation. Building. Elstree. Associated British Pictures ... Amalgamated Studios Ltd. Joe Rock Productions ... J. H. Productions Ltd. Wehvyn. British Instructional Pictures Ltd. ... Wembley. Associated Sound Films Industries Ltd. Cricklewood. Stoll Picture Productions Ltd. Hounslow. Criterion Pictures Ltd. Teddington. Warner Bros., First National Production Ltd. Twickenham. Twickenham Film Studios Ltd. Hammersmith. Twickenham Film Studios Ltd. Ealing. A.T.P. Ltd Shepherd'' s Bush . Gaumont- British Picture Corporation Ltd. ... Islington. Gainsborough Studios ... Walton. Nettlefold Studios Shepperton. Sound City (Films) Ltd Beaconsfield. British Lion Film Corporation Ltd. ... Ive.r. British & Dominions Film Corporation Ltd. Denham. London Film Productions Ltd. Totals 1 5 1 7 — 54 15 MINUTES OF EVIDENCE 127 SIXTH DAY Tuesday, 30th June (Afternoon Session) PRESENT : The Rt. Hon. Lord MOYNE, D.S.O. (Chairman). Mr. A. C. CAMERON, M.C., M.A. The Hon. ELEANOR M. PLUMER. Lt.-Col. Sir ARNOLD WILSON, K.C.I.E., C.S.I., C.M.G., D.S.O., M.P. Mr. W. H. L. PATTERSON (Secretary). .Mr. H. Bruce Woolfe called and examined. The Committee had before them the following memorandum by Mr. H. Bruce Woolfe: — 1. Since the Cinematograph Films Act became law a change has taken place in the relative values of "long" and "short" films. From being an un- considered trifle of little importance the short film, by reason of its suitability for non-theatrical, educa- tional and cultural purposes should now be con- sidered not as a " fill-up ", to use the jargon of the trade, but as having a definite purpose to fulfil. Of late years the production of " short " films has fallen considerably. On all sides we hear complaints that there are not enough of this type of subject. Educationalists declare they cannot instal projectors until there are more films of the type they require. Practically all denominations of the Church adopt the same view point; film societies, welfare centres, and all groups of people who desire to see something different from what is offered them in the cinema theatres, are of the same opinion. Short films are needed, but the Cinematograph Films Act, by grant- ing quota and thereby placing a premium on the production of feature films, irrespective of quality, has contributed to the ousting of the short film. The main items which form the subjects for short films, i.e., natural scenery, industrial and manufac- turing processes, scientific films, and natural history films are automatically barred from acquiring quota (Note 1). Any cheap feature production (provided it has spent the requisite proportion of wages to British subjects, and has been made in the British Empire) is granted quota as a matter of course. Further, if a renter is lacking quota on short films, he is allowed to get over the difficulty by acquiring features to the same amount of footage that he lacks in short subjects. Foreign renters can therefore acquire short films made in their own countries and match them with inferior British feature films. This artificial competition of long quota pictures has brought the short British film into a bad state. 2. Another factor in the paucity of short films is the tendency in the cinema theatres in recent years towards the adoption of a double-feature programme. This tendency has developed in such a manner as to seriously affect the production of short films of all descriptions. It is in this department of the cinema industry that this country occupies a proud position. Our new reels are second to none; our documentary films are recognised as being equal to those produced in any other country, while our scientific and semi- scientific or " interest " films are recognised as the best the world produces. None of these types of films, with the exception of the news reel, can be produced and marketed successfully. Unless con- ditions change the production of these films will cease for all practical purposes. At the present time very little is being produced in the documentary field except for propaganda purposes, while if we consider short films, we find that those with any pretence to quality are made at a loss. 3. If the non-theatrical market was extensive enough to enable short films to be produced on an economic basis it would not matter that the theatres were unable to show such films. This, however, is far from being the position at the present time. It will have a most harmful effect in the development Note 1.— Cinematograph Films Act, Part IV. 27 (1)" 37873 of the educational and cultural film if the supply of the type of subject that is most desirable and necessary for this purpose is restricted. 4. Increased interest is now being taken in i his field and efforts are being made to overcome tlie shortage of films which so handicaps the installation of projectors in non-theatrical halls, which installa- tion is essential to the development of the educational and cultural film. 5. The position at the moment is therefore as under : The production of British short films, with the exception of News Reels, which have a specialised market, but which, by the nature of their hurried production cannot be considered as helping to de- velop the cinema, is severely handicapped, while the production of British made second feature films of poor quality is encouraged by the granting of Quota : and the general level of British production thereby reduced (Note 2). The development of the cinema as a medium of culture and education is considerably delayed owing to producers of the type of film necessary to add this development being unable to procure revenue from the theatres. Phis is owing to the fact that screen time to the extent of 25-30 per cent, of the programme is taken up by the showing of second feature films, thereby con- siderably restricting bookings of short films. HOW CAN THIS POSITION BE IMPROVED? 6. In Germany, by showing a certain amount of educational films, theatres are given a rebate of Entertainment Tax. In Italy, it is compulsory to show an " educational or cultural " film in each pro- gramme. Neither of these methods are satisfactory, as both open the door to propaganda. In this country Exhibitors would oppose very strongly, and I think would rightly oppose, any measure which would enable their screens to be used for this purpose. I believe that if the short film is given a fair chance it would soon regain its one time popularity (which it has never lost with the public) and I would there- fore suggest that the Clause in the Act, Part IV, Paragraph 27 (1), should be altered so that short films depicting subjects of National, Imperial or Public Interest, Scientific and Natural History films should be allowed to receive full Quota. 7. It has been suggested that a cost clause should be fulfilled by any film before it can qualify for Quota. While this may cause producers to think a little more before embarking on production, it can- not ensure quality. 8j. I believe that no satisfactory solution of this problem will be found until a Committee acting under the Board of Trade Advisory Committee is Note 2. — Leading producers in this country, who have done so much to lift the industry to the position it now occupies, i.e., the second producing country in importance in the world, do not produce second features; these are made almost entirely by people who have forced their way into the industry not with any idea of developing it as an industry, but solely with the desire to sell anything from which they f so many years, but there comes a time when it could be revived and still would not make large extra profits. 1583. (f'hiiii limn) -. YVY arc very much obliged to you. Mr. Montagu, for your help. — Thank you. (The Witness withdrew.) :iTS7:-t D 3 146 COMMITTEE ON CINEMATOGRAPH FILMS 7 July, 1936.] Mr. .). S. Fairfax- Jonbs. [Continued. Mr. J. S. Fairfax-Jones, representing Denning Films, Ltd., was then called and examined. The Committee had before them the following memorandum bj Denning Films, Ltd.: — 1. The Committee will doubtless be aware of the existence of certain Cinemas, such as the Ourzon. the Academy and the Everyman in London, and in several provincial centres, which specialise either wholly or chiefly in the presentation of a certain type of foreign film. Such films are derived largely from French, Austrian and German sources and have a special and generally recognised exhibition value. Such films are also exhibited by private Societies in several of those towns where no commercial facilities for the exhibition of these films exist. 2. These films, being of foreign origin, naturally fall within the provisions of the Cinematograph Films Act, 1927, with regard to renters quota and accord- ingly any registered renter registering a film or films of this type is obliged to comply with the provisions of the Act as to the supply of British quota. 3. When the present Act came into force there were, it is believed, no Cinemas specialising in the presentation of these films and, therefore, their special position received no consideration when the Act was framed. 4. The Revenue derived from the renting of these films is extremely small. In many cases it is believed that such revenue is less than 1 per cent, of the revenue derived in this country from the renting of an averagely good American film. In view of the expense of producing or acquiring British films for quota purposes, renters naturally prefer to place American films against their British films. Therefore, few, if any, renters who register these specialised foreign films can be found. The problem of main- taining an adequate supply of these specialised films for the Cinemas and the Film Societies is con- sequently an acute one. 5. It may be mentioned, in passing, that the ex- hibition of the films in question is highly approved by many educational, cultural, and artistic bodies and that non-commercial performances of such films by Films Societies are exempted from Entertainment Duty by the Commissioners of Customs and Excise on educational and cultural grounds. 6. The question now arises as to the continuance of the supply of these films so that the comparatively few Cinemas who exhibit them and the Film Societies may continue their work. Under present conditions it is impossible for this supply adequately to be main- tained and the problem can only be resolved by special provisions regarding the registration of these films. 7. It is accordingly submitted (1) That, in the event of further legislation with regard to quota, special consideration should be given to the case above outlined. (2) That the existing requirements with regard to the supply of British quota in respect of these special foreign films should be substantially qualified or abolished. (3) That approved firms of renters known to specialise in the supply of these particular films should not be required to supply British quota in respect of them. (4) As an alternative, that such firms should be permitted to register such films and to book them to a specified number of Cinemas before any question of a supply of British quota arises. (5) That some limit on the number of foreign films so to be exempted in each quota year should be agreed. (6) Thai possibly some form of quality tesi or test of suitability for such exemption should be applied with some independent but qualified body, such as the British Film Institute, acting as an arbitrator in the matter. 1584. (Chairman \ : Mr. Fairfax-Jones, will you tel] us how you are connected with Denning Films. Limited — are you a director? — 1 am managing director. 1585. In paragraph 7 you recommend that approved firms of renters specialising in the supply of these particular films should not be required to supply British quota in respect of them, but, I suppose, it is not your idea that this should be an uncondi- tional arrangement, that they should be free from quota as soon as the film is shown to be a commercial success? — No. I think there would have to be some form of limited circulation, certainly. 1586. And would it seem to you a satisfactory method if the film was released from any quota requirements while rented for so many weeks on a restricted basis, and then, at the end of that time, it you found that the demand warranted it, you should go to the Board of Trade and get the film registered in the ordinary way, and that it should then rank for quota? — Yes, I think that would be the case. If it transpired that one of these films was likely to be a large commercial success, as one or two have been, then I think it would be for the renter to determine what point of view he was going to take about it. If provisions are made as to a limited distribution of these films I think he would have to make other arrangements for a film that was likely to be a big success, certainly. 1587. And, of course, in the early stages it would not go to the censors either, because these film societies, at their private shows, do not have to get their films passed by the censors? — They do in many cases, and certainly in every commercial case. 1588. Once it had got past that stage, it would obviously have to be registered by the Board of Trade and passed by the censors or the local autho- rities?— Yes, the Film Society performances, which are the private shows to which you refer, generally follow the commercial performance. 1589. It follows? — Yes, these films generally be- come available for the film societies because they have been brought over for commercial performances. That is the way it works in the majority of cases. 1590. Those would be foreign films, I suppose? — Yes. 1591. Not films produced here? — Yes. I am re- ferring to films from abroad and continental films. 1592. Otherwise the question of the film show would not arise? — No. 1593. If we were able to work out some re- commendations to cover this point, would there be any object in your proposal in paragraph (5). that some limit should be agreed on the number of foreign films to be exempted. I suppose to have the test by trying them out on a limited scale would be enough? — Yes. I only put that suggestion forward rather tentatively as a mat tor possibly for negotiation. 1594. (The Hon. Eleanor Plvmer): Is there a growing public for these foreign films? — Yes. there is, but. of course, the problem of supply comes in again there. 1 think that the public would grow if there were a larger supply. At the moment certain films have to go round and round, and it does not help much on the whole. 1595. You think the development is definitely hampered by the difficulties of supply? Yes. 1596. And that with an increased supply demand would follow?- 1 think so. yes. and with an in- creased supply I think more of these cinema-, would spring up. At the moment the supply is so uncertain that cinemas arc afraid of a policy of showing tins type of film because they are not sure that the supply will be maintained. 1597. I see. You mention several provincial centres — I know one or two; which are the MINUTES OF EVIDENCE 147 7 July, 1936.] Mr. J. S. Fairfax- Jones. [Continued. main centres? — Well, there are cinemas of this type at Oxford and Cambridge ; there is one at Leeds, I believe, and at Glasgow, and there are quite a number of cinemas which do .show the best of these films from time to time, and would, I am sure, have a reasonably permanent policy of doing so if again this question of supply could be reasonably certain. 1.598. (Mr. Cameron): Did I understand you to say to the Chairman that the films shown by the Film Society were mainly films that had been intro- duced into the country for commercial purposes? — I do not mean the London Film Society. I mean the provincial Film Societies. 1599. But are not the films shown by the pro- vincial film societies mainly ones that have been introduced by the London Film Society? — Very rarely, except in the case of short films. 1600. That is your experience? — Yes, that is my experience. In some cases the films shown by the London Film Society are commercially exploited, and in some cases they go back immediately to the country of their origin ; perhaps two in the London Film Society's season are subsequently exploited in the provinces. 1601. Yes, but the London Film Society has un- officially acted as renter for a number of the films it has brought over, that it has not returned directly. I know that some are returned direct to the cotintry of origin, but there are a 'number that the Film Society has retained acting as an unofficial renter, and has circulated them to provincial film societies, who, in effect, have booked their films largely through the London Film Society? — Not to a very great extent have they acted primarily as renters, for this reason, that films which are not commercially exploited are not titled in English — you know the English sub-title put on foreign films? 1602. Yes? — And the film societies prefer to show films which have got English film titles on them ; they are only titled in English when they are going to be commercially exploited. 1603. Oh, but some of the London Film Society's films have been sub-titled in English for their show- ing at the Film Society? — One or two have. They generally have some explanatory titles inserted, but I do not think in any case have they had the dialogue translated. 1604. No? — And that is what the Provincial Film Societies want in the main. 1605. Yes, to some extent; I would not accept it that that is wholly so? — No, it is not wholly so, there have been exceptions, but with very many of them I think it is so. 1606. I should have thought the exceptions were considerable? — I cannot think of any exceptions. I happen to be Secretary also of one of the Provincial film societies. 1607. Yes, I know? — And I know a fair amount about the actual supply of films. In one or two cases I agree with you, Sir. 1608. Yes. There would be more cases if some differential legislation were introduced? — Yes, undoubtedly. 1609. That is the real point that you make? — ■ That is the real point, yes. 1610. (Sir Arnold Wilson): I have no questions, thank you. 1611. (Mr. Stanley Holmes) : I have no questions. 1612. (Chairman) : Mr. Fairfax-Jones, we are very much obliged to you. (The Witness withdrew.) Mr. F. Green, representing Ace Films, Ltd., Ace Distributors, Ltd.. and Ace Studios, Ltd., was then called and examined. The Committee had before them the following memorandum by Mr. F. Green : ■ I respectfully submit the following observations on account of the fact that none of the Companies whom I represent are members of any Trade Asso- ciation. If the Cinematograph Films Act 1927 is to be continued for a further period of ten years, the only observations I should like to make woxdd be : — 1. Section 27 (1). — During the running of the ex- isting Act I have suffered hardship on account of the fact that many important films produced have not been films to which the Act applies and there- fore unregistrable as British films because they have fallen under Section 27 (1) of the Act, and I claim that a British film made by a wholly British company is none the less a British film, nor does it fall outside the purpose of the Act — to employ British labour and materials — if the substance of the film is any which falls under Section 27 (1) of the Act. This section necessarily retards the pro- duction of British exploration films, natural history films, scientific films, pictorial song films and other important contributions to the art of cinemato- graphy and is a hardship to those engaged in pro- ducing and distributing films of this nature. 2. Section 27 (1) (i). — Although registration has on many occasions been subsequently allowed because of a film having special exhibition value, the same cannot be promised to the exhibitor on the film being rented to him and, in consequence, the British producer and renter suffer hardship. 3. Section 27 (1) (ii). — I suggest that the ex- hibitor has no right to have the benefits of films under this section for his Quota purposes if they do not also give to the renter the same benefits. 37873 4. Section 27 (3) (i). — The regulations in regard to what is a British film are not, in my opinion, sufficiently stringent, see Section 27 (5). 5. Section 27 (5). — I submit that a British film should only be made by an English, Welsh, Scotch or Northern Irish Company. It does the British him trade no good, nor does it create labour in this country, to have a British film made in the Colonies or the Dominions, or particularly in the Irish Free State. The restrictions in regard to foreign directors of companies controlling a business with English direc- tor nominees who have no financial interest in that business should be tightened up. 6. Section 30. — I submit that the Advisory Com- mittee should contain a film trade member other than the representatives of the K.R.S., F.B.I. , C.E.A., and the five independent members. 7. Section 33 (2).— I submit that the Act should extend to Northern Ireland by reason of the block booking position in that territory. 8. I suggest that the renters' and exhibitors' quota of 20 per cent, (twenty per cent.) should con- tinue for a further period of ten years. 9. If observation may be made upon the garbled reports that have appeared in the Press concerning submissions already made to the Committee upon the further working of the Act, I submit: — (1) that no change whatever should be made in the percentage of the renters' or exhibitors' quota and that under no circumstances shall the renters' obligation be greater than the exhibitors' obligation under the Act. I make this submission on two grounds. Firstly, that D 4 I IS COMMITTEE ON CINEMATOGRAPH FILMS 7 July, 1936.] Mr. F. Green. [Continued. it is fair and just to both parties that an equal obligation be shared, and that it is wholly illogical to impose upon a seller of goods a greater obligation than upon a buyer of goods ; secondly, that the evidence before the Com- mittee will show that the expiring Act lias been a success, and that the expansion of the British film industry is entirely and absolutely due to the assured market created by the obligation of the exhibitor to show a percentage of British films. 10. It is reported that foreign influences are sub- mitting to the Committee suggestions to alter the quota obligation on renters to one of price instead of footage. In my submission, this is merely a red herring drawn across the deliberations of the Committee. With one exception only there has been no bona fide attempt by foreign renters to fulfil their obligations under the Act by other than the cheapest possible means. The Cinematograph Films Act, 1927, was intended to, and did provide, employment for a vast number of people. Although fulfilling their obliga- tion by cheap pictures foreign renters at least thereby provided work for a large number of people. If price instead of footage were to be their obliga- tion under the Act it would put a premium on the services of the expensive type of film technician to the detriment of a large number of smaller British technicians, and British labour in general. 11. Although the cost of production of a film should be evident on the screen, in fifty per cent, of cases it does not do so and, in my submission, the Committee would wrongly put a premium on money against brains by making a money quota. It is not a vast expenditure of money that makes good films — rather it is the intelligent co-operation between money and brains that has made all the box office successes of recent years. If legislation were enacted whereby only films costing £12,000 (the price sug- gested by one Association) should rank for quota, undue hardship would be caused to many people bona fide engaged in the production and distribu- tion of British pictures, and this legislation would also play into the hands of foreign distributors, as it would keep off the market probably one hundred British films per annum, the revenue from which at present goes into British hands and deprives foreign films of play dates in this country. 1613. (Chairman) : From paragraph 5, I under- stand that you do not wish that the Empire should continue to enjoy its present favoured treatment, Mr. Green, but you would make an exception in favour of Northern Ireland? — Yes, my Lord. The arrangement for importing Colonial films and films from the Dominions has not been very successful up to the moment. 1614. The quality is bad, or you are not satisfied that they comply with the percentage requirements? — I think they should not obtain quota, because they compete with quota produced in this country with no advantage to us. 1615. But is there any other way in which you find it unsatisfactory? — No, my Lord. 1616. Because, of course, there is something to be said from the other end of the story, that already in some cases, and we hope in other cases in future, we get reciprocal advantages for British films? — That is a very important point. 1017. Then in paragraph 1] you deal with the cos! test, and you point out that cost is not an infallible criterion, and I think everybody would agree with you on that view, but would you accept the view that if you had a cost test it would automatically exclude a great many pictures which should he es eluded, and automatically include pictures which in the ordinary way would he much more worth while than the present quickies? — No. my Lord, I do not think that. 1 do not think the solution is to be found in relation to either quality or cost, hut in the fact that a person or company makes a film for its own bona fide distribution — that means to say that the person or company making the film shall make a profit or a loss from its production and dis- tribution, not that he can sell the film to someone who requires it, merely because it is a quota ticket to somebody who badly needs it. There is an enor- mous difference. 1618. That will mean that the foreign renter could not acquire British quota films from anybody < Ise, would it not? — He could make them, my Lord. 1619. He would have to make them, yes. — Or he could acquire them subject to a quality or test clause at your discretion. 1620. The trouble is that even if he makes them at present they are liable to be made extremely cheaply, and do you not agree that a lot of this cheap production for quota purposes is very un- desirable and gives a British film a bad name? — Definitely, my Lord, but it has created labour. The Act was formed to stimulate the film trade. 1621. But it would give just as much labour if the film were worth while, would it not? — No, I am sorry, it would not. It would employ highly qualified technical experts, a few of them, at enormous salaries, chiefly foreigners, and it would put out of business all those very worthy people, those electricians, stage- hands, property people, and so forth, who at the present moment are engaged upon the making of these films. 1622. But surely, if by some means these foreign renters were compelled to turn out good films instead of bad films, and had to turn them out here, just as many people would be employed, or more people, on the good films? — 1 should like to believe that, my Lord. That, of course, would be the solution, but it would put so many people out of business, either on quality or on cost, that it would not be worth the legislation. 1623. Would it not just be a matter of proper adjustment to see that the demands were not too high, that you could get the new output of better quality and of not less volume — if you could achieve that? — I very much doubt it, my Lord. I assure you that the solution rests upon a decision to permit and to encourage production of all kinds. 1624. Would you allow the worst forms of pro- duction?— Provided, my Lord, that they had to be rented to make the profit for those who made them. I object to the production of quota quickies for the foreign company which merely requires a quota ticket. 1625. You only object to it from that point of view? You do not see objection to it in the bad reputation it gives to British films, and the disgust that it inspiies, we are told, among many audiences who want to see a good film? — No, my Lord, it is entirely a commercial proposition. If a person has the money to produce a bad film, and he is prepared to lose his money, all of it, he has a perfect right to do so. 1626. Yes, but the exhibitor — ? — The exhibitor is not compelled to show it. 1627. The exhibitor has the same temptation to show these films, to fulfil his quota requirements, whether they are made by a man for his own profit in this country or on behalf of a foreign renter; it would not really eliminate this evil? — The ex- hibitor generally tries to hook good films, quite definitely. 1628. Yes; but we are told that the exhibitor cannot get good films at the present time, because it pays many producers, not only American pro- ducers, to produce bad films, and you cannot help us to the solution of the problem of eliminating these had films? You think thc\ should he allowed to go on? — No, my Lord, legislation could be found to make the person who must obtain quota provide films of a certain quality. 1629. Yes. Would it work to have an automat ie test of cost, to admit films above thai cost standard without question and to have any films which do MINUTES OF EVIDENCE 149 7 July, 1936.] Mr. F. Green. [Continued. not comply with that test examined on quality, so that if they have got special value and are not a discredit to British film production they may be allowed a licence in respect of the low cost? — It would be frightfully difficult. 1630. Then what is your solution? How are you going to eliminate bad films? — A person who re- quires to make a bad film, and desires to make a film of any kind, be it good or bad, providing it is for his own distribution, should be allowed to make it. 1631. In other words, the bad film is to be allowed to go on, and to cut away profit from the good film, because obviously a good film will not be able to compete, in the case of certain exhibitors, with the bad film ? — No, my Lord, but he would not do it more than once, would he? 1632. Well, they have done it a lot of times already, and there is nothing to prevent them pro- ducing better films. If it paid the exhibitor to show the better films rather than the worse films it is quite open to the producer to produce better films now. and yet he does it more than once, he goes on producing bad films? — It does pay the exhibitor to show the better films always, but the foreign renter has an obligation upon him to provide a certain quota and he obtains his quota in the cheapest market. That is what is bad. That is primarily and fundamentally bad, because he goes to buy his film in the rag market. He will buy any film which has a quota ticket, one that was made by a person for the sole purpose of selling it for a quota ticket. but it was not made for the purpose of bona fide distribution, and for the purpose of making profit. 1633. You think that quickies would be eliminated, because if you cut out their production by the American renter it would not be worth while for the British producer to make them ? — Quite. I am posi- tively certain. Sir. that if the two were separated from each other, quota for foreign distributors here in England, and the making of bad quickies for ordinary distribution here. I am perfectly sure that within one year there would be no quickies. "Who would make one? 1634. I see. Well, how would you deal with tin American renter? — That is the problem. 1635. You have got no solution? — No. 1636. (Mr. Holmes): Supposing we altered the Cinematograph Films Act so that the quota had only to be complied with so far as the exhibitor was con- cerned, and there was no quota on the renter at all — that the exhibitor had to have his quota of British films — would that help in getting rid of the bad film ? — Not a bit, it would automatically put hall the exhibitors out of business because there would not be enough films produced. 1637. But it would be an encouragement for them to produce? — It is no encouragement to produce, unless one is compelled to produce — if one is a foreign company. 1638. But if it is known in any trade that there is a definite market every year, then there are people prepared to produce for that market? — They do not do so, Sir, in our business. 1639. (Mr. Holmes): That is all, thank you. 1640. (Sir Arnold Wilson.) : I have no questions. 1641. (Mr. Conn ron) : I have no questions. 1642. (The Hon. Eleanor Plumer) : In paragraph 1 of your memorandum. Mr. Green, are you re- ferring to all films when you speak of Section 27 (i) or only short films? — I deal chiefly with any film that is a British film made for bona fide distribution by the person who made it, and not for sale to a third party. 1643. And you would include long and short films? —Both. 1644. Would you like a separate quota for short films ? — I think it would be a good idea to separate the two. I think it might stimulate the production of shorts in this country, which is so difficult. 1645. You are mainly concerned with the pro- duction of shorts? — Yes. Next year I shall have the biggest output of shorts in this counntry. 1646. And do you find that the market for them is adequate? — It could quite well become much better. 1647. How is that? — I think the second feature will be eliminated within a year or so, because it is indigestion to the public. 1648. We have had a good deal of evidence to the contrary on that point, of course? — I realise that. 1649. In some quarters we are told that the second feature has come to stay, that you cannot get away from that, but you would take the opposite point of view? — I would say it will come back again eventually; that the big film, which to-day is getting bigger and bigger, will be the main point in the programme, and that the balance of the programme will be short films of various kinds. 1650. You think that is the future development? — That is the ultimate view I hold, yes. 1651. (The Hon. Eleanor Plumer): Thank you. 1652. (Chairman): We are much obliged to you, Mr. Green. (The Witness withdrew.) Mr. T. O'Brien and Mr. J. Rogers, representing the National Association of Theatrical Employees, were then called and examined. The Committee had before them the following memorandum bj Theatrical Employees : — the National Association of The National Association of Theatrical Employees is a registered trade union, and caters for and re- presents many grades of skilled and non-skilled employees in the entertainment industry, particular^ in film studios. It has within its film studio mem- bership, carpenters, electricians, plasterers, painters, scenic artists, mechanics, property-makers, sta hands, riggers, projectionists, make-up artists and other general workers. The interest of the National Association of Theatrical Employees (afterwards referred to as " the Association ") in the Cinemato- graph Films Act, 1927, and in the future of British films, is decidedly one of employment of its members and workers in the British film industry. The Association realises that any progressive or re- trograde policy in regard to the present and future production of British films will have far-reaching effects upon employment and unemployment of the grades of people referred to above, and to many other classes of employees, and technicians, artists, actors and executives. The Association does not propose, nor does it think it relevant, to submit any detailed or analytical case to the Committee of Enquiry. The technical. administrative, commercial and financial angles have, or will no doubt be adequately presented by the appropriate interests. The Association wdl be satisfied to approach the subject from the point of view of the employmenl of British labour, rather than to offer a solution to the general difficulties of the Act. Having regard bo these considerations, the Association offers the following observations: — - 1. The British film production industry could not have reached its present substantial position had there not been the Cinematograph Films Act. 1927, which ostensibly had for its object and was intended 150 COMMITTEE ON CINEMATOGRAPH FILMS 7 July, 1936.] Mr. T. O'Brien and Mr. J. Rogers. [Continued. by the Legislature to establish a British film producing industry for a British market. 2. The Act in regard to the quota provisions has not proved easy of operation. Exhibitors of pictures have a legitimate grievance in being obliged to show a number of certain British films of an inferior standard. Certain film producing concerns have been enabled to make British pictures of such a low standard as to constitute a serious menace to the very prestige and representation of British art, skill and labour. 3. A large number of film producing concerns take the making of British pictures seriously, and are endeavouring to meet Hollywood's generation of ad- vantages and experience and skill in a creditable .way. It follows that if opportunities of low standard production (referred to as " the quickies ") are to be permitted and continued, the future of the British motion film producing industry .will he undermined. The exhibitor of pictures, the better type of produc- ing company, the representation of artists, technicians and labour, and the general public itself, will be adversely affected by the perpetuation of manipulated low standard production. 4. The Association feels that the solution is not to scrap the Films Act, as is suggested in certain quarters, but to amend the Act so as to make it impossible for the evils complained of by the various interests to exist, and to learn from the ten years' experience of the present Act those lessons that will tend to further encourage the continued production of bona fide films, and the future strengthening of the British film industry. 5. The Association suggests that an amended Act should provide for a producers' or renters' quota to reach a minimum of 30 per cent, to 35 per cent, of the imported product by 1943. Exhibitors' quota would require very close study, presuming that in any new Act the production of cheap, trashy and inferior films would be eliminated. The Association believes that the Committee of Enquiry would be better able to form a judgment on the question of the exhibitors' quota from the representations which the exhibitors themselves may make. A suggestion is offered, how- ever, that exhibitors' quota should be no less than 75 per cent, of renters' quota. 6. The definition of a British film should be re- considered in order that a minimum expenditure (excluding the story) is stipulated to entitle the films for registration. The suggested minimum expendi- ture should be £15,000 on each picture. News reels, shorts, documentaries, should be excluded from the Act. The principle at present embodied in Section 27 (3) (iv) should extend to any new Act, but pro- vision should be made that increases in the salary of " Stars " after the date of their original contract shall not be regarded as fulfilling the provision of the British salaries stipulation. A British film shall mean a film made in Great Britain. 7. The Association offers no objection to the con- dition that the scenarist being British, be eliminated from any new Act, provided that the fees and salary of a non-British scenarist shall not rank as an item of expenditure in the suggested minimum cost of the picture. Lastly, the Association desires to make it quite clear that they advocate statutory protection for the British film industry, not in the sense that the in- dustry should be effete, merely relying on legal pro tection, but rather quoting the words of .Mr. Simon Rowson, M.Sc, K.S.K. " That the protection afforded by the Act (the Cinematograph Films Act) is an inseparable part of the whole atmosphere in which the industry works, lives, and has its being. A with- drawal of this protection would in itself create con- ditions which might well prove disastrous to nearly every part and section of the industry.'' Moreover, the question is one that cannot be divorced from national economic and political considerations. Legislative protect ion for the British film industry ought not to be considered solely from the point of view of the industry itself. The relation of the sub- ject of employment of British labour, technicians and artistes, should not be overlooked, nor those higher considerations of British culture, art. educa- tion and national needs. 1653. (Chairman) : Mr. O'Brien, you are the Secre- tary of the National Association of Theatrical Kmployees? — (.1//. O'Brien): Yes, and my colleague is Mr. J. Rogers, who is on our Executive Com- mittee and our studio representative. 1654. I see. In paragraph 5 of the observations in your memorandum you suggest that the renters' quota should reach a minimum of 30 to 35 per cent, of the imported product by 1943. You are, of course, aware that the quota is now measured not on the im- ported product but on a percentage of the total im- ported and foreign together? — Yes, Sir. 1655. What is your reason for wishing to change over the method of calculation ? — There is no par- ticular reason for changing over the method. The principle we desire to maintain is that the British quota shall be increased from its present maximum of 20 per cent., which it will come to in 1938, and in any Act that it should be increased to, at least the minimum stipulation shall be, 30 to 35 per cent., graduated over a period, we will say, from 1938 to 1943, allowing for the first five years of any con- templated new Act. 1656. It would really be the equivalent of 25 per cent, on the present basis of computation? — Yes. 1657. Twenty-five per cent, on the present basis or 33 per cent, on your basis? — Yes. 25 per cent, on the present basis, and it would work out at 33 per cent, on our -own idea. 1658. But you do not attach any particular im- portance to one method of computation over the other provided you get that result? — No, the main point is the result. That is what we are concerned with. 1659. And you say that the exhibitors' quota should be no less than 75 per cent, of the renters' quota. At present, of course, it is the same. Will you tell us whether you want it to be less or whether yen think it ought to remain the same as the renters' quota from time to time? — The exhibitors' quota, we suggest, should be 75 per cent, of the renters' quota provided the renters' quota was increased in accord- ance with our suggestion. We agree with the prin- ciple of the exhibitors having that margin of choice, which could only be provided for, we think, by their quota being slightly lower than the producers' quota. Have I made that clear, my Lord? 1660. Well, as far as we have been able to study the figures the margin of choice does not vary directly with the quota requirements? — Of course, there are other considerations. 1661. Yes, but we need not go into that. You. at least, recommend that there should be a variation between the exhibitors' quota and the renters' quota. and that the exhibitors' quota should be only three- quarters of the renters' quota? — Yes. 1662. I mean your minimum is to be taken as standard — you would like it to be 75 per cent, all through the new quota scale? — Yes. 1663. I see. In paragraph 6 you suggest a mini- mum expenditure on each film and you suggest that news reels, shorts and documentaries should be ex- cluded from the Act. Could you tell us why you wish t) abolish the benefit given by tin- Act to short films? Well, having regard to our main angle on the problem, that is to the interest of employment of British people in British films. We think that the inclusion of news reels, shorts and documentaries without either or any of these terms being verj closely or adequately defined would provide a very substantial loophole for exhibitors or for producers to have films for quota purposes, probably very in- expensive at that, ami thereby perpetuate the same difficulty of abuses in regard to the quickies which now take place. If you eliminate quickies and you MINUTES OF EVIDENCE lo I 7 July, 1936.] Mr. T. O'Brien and Mr. J. Rogers. [Continued. substitute for them an en masse series of shorts and documentaries and alleged news reels and so on —I am not referring to the present adequate news reels of Gaumont-British or Pathe type — you could flood the market with all kinds of pictures which were called news reels, and thereby fulfil quota purposes. 1664. Yes. You say if you eliminated the quickie and substituted the short— I take it there would be no suggestion on the part of most people that you should substitute the short? — No. 1665. If you kept the short quota separate, per- haps altered the law in that respect that it should definitely be separate — there are various ways in which you could do it? — Yes. 1666. Have you considered whether shorts are not a very valuable training ground for British per- sonnel, and in any case if we eliminated this re- quirement that a certain proportion of the shorts which will be shown in the theatres should be British, is it not certain that the only people who would benefit would be the foreign purveyors of shorts, who would go on filling the programme in response to the public demand? — That would be problematical. I would not profess to be dogmatic about it, but if shorts met a public need — or. rather, the public taste — British exhibitors and American exhibitors producing in England would still produce shorts to meet that public need. 1667. Does not exactly the same argument apply to longs? — Yes, but whether they should be included for quota purposes is quite another matter. We feel that with the state of the financial control and other interlocking of the film interests in this country at the moment, a new Act at least should definitely protect British produced pictures from the misuse which is now obtaining in regard to quickies. It is no use eliminating quickies as suggested. You can have a seven reel quickie apart from a one reel quickie which is still a badly produced picture. It is no good eliminating that and substituting another form of abuse by way of shorts and newsreels, and so on, which could be done, and probably would be done if there was no adequate check on it. An English programme, if it provided, say — any figure will do for the moment — for 30 per cent, of English pictures, you could have an American picture, a very excellently produced American picture, on the programme and about four or five newsreels, shorts, and so on. all thrown in with the one picture to fulfil quota purposes, just as vou have to-day. 1668. Your case really could be dealt with by say- ing that we cannot count shorts against the long quota requirement? — That is really the point, my Lord. 1669. Now. will you develop the view you express in paragraph 6, that ". . . provision should be made that increases in the salary of ' Stars ' after the date of their original contract shall not be regarded as ful- filling the provision of the British salaries stipulation "? — Well, we are seeking there to anticipate what probably really is now going on. A star is engaged at a certain figure and in the line-up of expendi- ture, and so on, the producer finds that he is down on his expenditure, or down on his allocations on the wages and salaries stipulation. He will prob- ably make a fictitious increase in the salary of a star or he may make nn artist into a star at a fictitious salary who is not, in fact, a star. 1670. Your object is to prevent the cooking of the returns ? — Eixactly . 1671. (Chairman) : I see. Thank you. 1672. (The Hon. Eleanor Plumer) : In that same paragraph, paragraph 6. you say, " A British film shall mean a film made in Great Britain." Is your idea to exclude the films made in the Dominions? — No, not necessarily. We should have amplified that. Our Committee felt, when we put in " Great Britain," that we would not trespass too far afield in entering into the point as to whether films made in the Dominions were ranked for quota purposes, because the condition would still be equal in the Dominions. The Dominions would have their own difficulty, and 1 believe Australia is now at the present time, dealing with the question of their quota, so we would much prefer to keep to our point that a British film shall mean a film made in Great Britain, but personally I may tell you that we are not opposed to a film made in the Dominions, but at the same time we do not want to go into it too deeply in view of the fact that the Dominions them- selves have not reached any parity or any agreement with this country with regard to the inter-exchange of British and Dominion produced films. 1673. Then you would really need to qualify that sentence in which you assert that a British film shall mean a film made in Great Britain, do you not? — Yes. 1674. You do not want to stand by that? — I do not want to make it too wide a case on the Dominion question either. 1675. It is a very important point? — It is, I appreciate that, but of the two evils I would much prefer to stand by the memorandum as it is and leave that problem to the Committee itself. 1676. But you realise it is a problem which has to be faced? — It is a very difficult problem, but repre- senting our particular interests on the employment side we will allow our comparable unions in the Dominions to force their hand in another way. 1677. I see. Then in paragraph 7 you say: — " The Association offers no objection to the condition that the Scenarist being British, be eliminated from any new Act ". Would you enlarge that a little? — Yes. The present provision, as .you know, restricts the scenarist to a Britisher. 1678. Yes? — We feel there is no point to be served by maintaining that provision. It is quite possible that a good British picture, with all the traditions possible in race and so on, could be written and the scenario could be completed by a non-Britisher. That is quite feasible. We feel, therefore, that that provision should be eliminated from any new Act, but with the employment of an alien or a non- Britisher his salary and expenditure would not rank within the wages and salaries stipulation. We want to give the advantage to British producers to have alien scenarists, let them have the advantage of alien scenarists but not the advantage of including the salaries of such alien scenarists within the salaries provision, therefore it would not be detrimental to an English scenarist. 1679. (The Hon. Eleanor Plumer): Thank you very much, that is all. 1680. (Sir Arnold Wilson) : Your Trade Union covers a great variety of crafts, does it not? — Yes. 1681. There is no Trade Union that I can think of which embraces a wider range of different occupa- tions?— Not within the entertainment industry. The nearest outside, I should imagine, would be the National Union of Railwaymen, where they would cover a number of crafts. 1682. What is the approximate number in your Union? — In the film studios? 1683. Yes ?— Approximately 5,000. 1684. Do you run any friendly, i.e. approved, society in connection with it? — Not as such. We have transferred those rights to the General Fed- eration of Trades Unions in Woburn Place, .Mr. Appleton's organisation. We have friendly society benefits of the character of friendly societies. 1685. Have yon any observation to offer on the conditions in the industry as they effect the health of the employees as compared with other indnst r — As far as our grades are concerned we have nothing whatever to complain about with the general wanes or working conditions of the British film studios." 1686. You, as the Chairman has pointed out, are a bit hard on shorts, newsreels and documentaries. 152 COMMITTEE ON CINEMATOGRAPH FILMS 7 July, 1936.] Mr. T. O'Brien and Mr. J. Rogers. [Continued. My understanding of some of the evidence that has been given to us is that they actually employ a larger proportion of men such as would be in your union per thousand pounds than an ordinary film such as you suggest, hecause there are no stars to pay, and therefore the proportion of money actually spent on the ordinary ruck of employees is propor- tionately higher? — That would be a very interesting point to develop in a discussion. I would reply guardedly by stating that from our observations shorts and newsreels, as we understand them, do not employ a great number of people at all. For instance, a short can easily be a one reel picture of the Lake District, but the net or the total number of people employed would be about three technicians. 1687. I .wish to make only this point, that if that film cost 10s. a foot, 7s. 6d. might well be labour, and that a film may cost two pounds a foot ami not more than 10s. may be labour? — 1 would agree there. 1688. From the point of view purely of employment there is a practical aspect of the newsreel film and the documentary and the short which cannot he ignored? — We would not attempt to, but, as I say, it is safe to say from our standpoint that a number of shorts and newsreels are and can be produced merely by the employment of about two or three technicians and no more. I am not, of course, in- cluding the labour involved in cutting and copying and duplicating, which has to bve done with all films irrespective of what they are. 1689. Has there been any development, to your knowledge, in this country in the past ten years of the actual making of the film from the photographic point of view, the making of the actual negative, the development in this country, the preparation of the negative in this country? — No. As a matter of fact, from the knowledge in my possession, this country is hopelessly behind in regard to that in the manufacture and making of the celluloid negative itself. I do not know of any British film company or any subsidiary company which is engaged on the making of the celluloid negative. 1690. Are there no firms ? — One firm has, I believe, a factory where they are trying to do some- thing in that way, but most of their negative stuff comes from America. 1691. That does not directly concern your Union? — No, not directly. 1692. Are you concerned with the stripping of the films to get the silver nitrate? — We are, indirectly. 1693. Have you had any complaints in that matter in regard to the working conditions? — There are very, very serious grievances which have been brought to our notice and brought to the notice of one of our colleagues in one of our other organisa- tions in regard to the general working conditions in the laboratories of this country, both those attached to the film industry and those not attached to it, because it is the practice of a number of film pro- ducing companies to let out their developing to outside people. Some film companies will very soon have their own laboratories and general cutting apparatus, but generally speaking the conditions operating in the laboratories of this country in con- nection with the film industry have very much to be desired. 1694. This does not directly arise under our Terms of Reference, but it is obvious that if we are asked by an industry to give them a further measure of protection for the manufacture of films in this country, the tendency will be not merely to import blank negatives from America but to make them here? — Yes. L695. There are practical technical advantages in making their films and having them fresh and new? —Yes. 1696. Which will mean an extension of the maim facture of the celluloid? — Yes. 1697. And of the stripping of the celluloid? — Yes. 1698. Your memorandum makes no reference to industrial conditions ?— No, we have not made any 'iience to the industrial conditions, because generally, as I have told you, tin- industrial con- ditions are very favourable in the film studios, with the exception of certain grades, such as laboratory grades and one or two general sections. 1699. Are they outside your Union? — The majority are unorganised. 1700. They are not in any other Union ? — No ; there are quite a few in another Union but the majority of those grades are unorganised. 1701. I have been told that conditions in certain laboratories dealing with the films are unsatisfac- tory.— Yes. 1702. Has that any relation to the organisation of the industry as a whole? You suggest that some of these film companies wall shortly start up their own laboratories, and to that extent we may safely assume that the conditions will be improved? — Yes. we have the control there. Our industrial strength in the studio itself is sufficiently strong to impose upon the reluctant firms a remedy for such bad con- ditions. I am not suggesting for one moment they would adopt them. 1703. Are they structural remedies? — What do you mean by structural remedies? 1704. Cubic capacity, light, air, ventilation? — Yes. 1705. Are you satisfied that the Home Office Factories Department have got all the powers they require in such matters? — Oh, yes, and there are adequate provisions for refreshments and meals, and so on. 17C6. Then how is it that these unsatisfactory con- ditions to which you refer have not been brought to the notice of the Factories Department of the Home Office?— Well, largely due to the fact that the em- ployees are unorganised. You see. you must keep in mind the fact that the film industry has deve- loped in one way very quickly in this country. This last three years especially have seen studios growing up around and about London, and we have had a great deal to do to keep in touch with the industrial conditions and to improve them as we go along, with negotiations with various producers — incidentally with whom our relations are very cordial. There is a very good feeling between the leading film pro- ducing companies and our Union. There are certain sections, such as the laboratories, which owing to their unorganised state cannot conscientiously ex- pect the Union to interest itself on their behalf, but at the present time we are turning our attention to the unorganised employees. 1707. But within your knowledge there have been several fatal accidents in film stripping factories in- volving loss of life? — I cannot recall at the moment any fatal accidents in the film stripping side. There have been fatal accidents on the erecting side, and also in regard to the performance of .stunts in the shooting of the pictures. 1708. No, I mean pure stripping of waste films? — I cannot recall any specific accident, although there was an explosion the other day where two people lost their lives. 1709. As far as you are concerned the Factory Acts are working and the Home Office have ii>>t full powers? — As far as our position is concerned, yes. (Mr. Rogers): I am inclined to answer that in this way. that the Factory Act Inspectors are not using the powers that they have to the extent that we would like them to do. because quite recently a big firm of picture makers brought two Iull American experts into the laboratories and the conditions were bad before these two men came, but they are very much worse to-day. In small rooms where ejrls were working they actually had to squeeze them up a bit to make room for another, and the girls bad already complained about not having enough space to work iii. I have worked in these laboratories myself and MINUTES OF EVIDENCE 153 7 July, 1936.] Mr. T. O'Brien and Mr. J. Rogers. [Continued. I know what the conditions are, and since the im- portation of these two American experts the con- ditions are very mnch worse than they were before, and there is any amount of room for an inspector in bhese places. (Mr. O'Brien): My colleague is refer- ring to the laboratories, of course. 1710. (Chairman) : Well, gentlemen, we are verj much obliged to you for your evidence. (The Witnesses withdrew.) EIGHTH DAY Tuesday, 14th July, 1936 Present : The Rt. Hon. Lord MOYNE, D.S.O. (Chairman). Mr. A. C. CAMERON, M.C., MA. Mr. J. S. HOLMES, M.P. Dr. J. J. MALLON, LL.D., J. P. The Hon. ELEANOR M. PLUMEP. Lt.-Col. Sir AENOLD WILSON, K.C.I.E., C.S.I., C.M.G., D.S.O., M.P. Mr. W. H. L. PATTERSON (Secretary). Mr. G. R. Hall Caine, C.B.E., M.P., called and examined. The Committee had before them the following Report on the Cinematograph Films Act, 1927, submitted to the President of the Board of Trade by the Cinematograph Films Advisory Committee: — 29th October, 1936. The Rt. Hon. Walter Runciman, President of the Board of Trade. Sir, 1. In considering the various matters from time to time referred to it by the Board of Trade, and particularly the statements made by exhibitors who have defaulted in quota, the Cinematograph Films Advisory Committee has been impressed by the frequency with which certain difficulties in the several branches of the film industry have been attributed wholly or partly to defects in the Cine- matograph Films Act, 1927. Moreover, the exist- ence of defects of the kind referred to has been confirmed by the trade members of the Committee. 2. In the circumstances the Committee considered it desirable to undertake a full review of the Act. 3. As a result of that review, we are of opinion that two main problems urgently need solution. These are, firstly, the strengthening of Part I of the Act to enable the Board of Trade effectively to enforce it, and secondly, modification of the con- ditions of eligibility for the registration of films as British, with the object of securing that films so registered shall be of a reasonable standard of quality. We are convinced that any other amend- ments that may be desirable are consequential upon, or of minor importance compared with, those required to deal with these main problems. Blind Booking and Advance Booking. 4. The position as we understand it, is briefly, as follows : — It is generally admitted that contraventions of the blind booking and advance booking provisions of the Act are widespread and that renters and exhibitors are equally at fault in this matter. It is suggested, however, that some of the major renters representing foreign interests are primarily responsible for the development of this state of affairs. Since the Act came into force, these renters have controlled a sub- stantial majority of the films of satisfactory quality available for distribution, and they have taken advantage of their position to induce exhibitors to take bookings of blocks of films in contravention of both the prohibition of blind booking, and the limitation of advance booking. Some exhibitors also, in order to obtain films in advance of their com- petitors, seek illegal bookings of this kind. The growth of these practices has forced renters and exhibitors who are desirous of complying .with the A There appears to be general agreement that the position in this respect is getting worse and threatens to become intolerable for many exhibitors now that the exhibitors' quota has risen to 20 per cent, from the 1st October, 1935. From the producers' point of view, " quickies " do not assist the development of the producing industry as would a similar number of films made honestly in accordance with the spirit of the Act, and they are damaging to the prestige of the British industry. 9. We are satisfied that the position is serious and urgently calls for measures to secure that British films which count for quota purposes shall reach a reasonable standard of entertainment value. 10. Various proposals for attaining this object have been made. Under one of these, renters who do not desire to acquire British films would be able to pur- chase quota certificates from renters who had acquired British films in excess of the quota, while under another a renter would be required to spend on his British films a prescribed percentage of his gross receipts from foreign films. We are unable to recommend either of these schemes. 11. Another proposal is, that the conditions of eligibility for the registration of a film as British shall include one requiring that the film shall have cost not less than a prescribed minimum amount. We recognise that the quality of a film bears no necessary relationship to the amount expended upon it, and that it is possible to produce a picture of good enter- tainment value at low cost. A minimum cost test, however, would have as its object the discourage- ment of the production of films of negligible enter- tainment value as cheaply as possible solely for the purpose of a nominal compliance with the renters' quota. That quota has now risen to 20 per cent, during each of the three years commencing on the 1st April, 1935. If, on this basis, a minimum cost test were imposed, the expenditure involved would be so substantial that it is reasonable to expect that renters would make serious efforts to ensure that the British films they acquired were sufficiently good to earn at least the amount spent on them. 12. In view of these considerations, we recommend the adoption of a minimum cost test for British films. 13. Proposals for such a test were made to the Board of Trade by the Federal ion of British [ndustries in May, 1930, and we submit the follow- ing scheme which modifies, hut is based upon, those proposals. 14. We recommend that the conditions of eligibility for the registration of films as British should require that the cost of production of such films should be not less than £2 a foot, excluding certain classes of expenditure and the limitation of others with a view to ensuring as far as possible that items included in the statutory cost represent genuine and reasonable payment-. This production cost should: — (a) exclude (1) cost of the copyright of the story ; (2) cost of the copyright of any music used ; (3) payment to the director(s) of the films; (4) payment to the author(s) of the scenario; (6) include only ( 1 i rent and location ; (2) artistes; (3) technicians; (4) sets and decoration ; (5) furniture and equipment; (6) costumes ; (7) stock (film, etc.); (8) electric current; (9) musicians ; (10) any other expenses directly and neces- sarily incurred for effective production of the picture, and so certified; (11) certified overhead expenses of the pro- ducing company. The figures should he those of actual expenditure, substantiated by receipts and vouchers, if required. The certificate of an accountant being a member of an incorporated society of accountants should be produced in substantiation of all cost figures. To prevent evasions the examining authority should have the right to query, and in extreme cases to disallow, costs obviously in excess of current rates. In the case of an artiste engaged on annual salary the admitted figure should be either the actual salary paid during the period of production or the annual salary paid divided by the number of productions in which the artiste appeared during the year (in- cluding times when the artiste may have been hired to third parties). The amount admissible for overhead charges should not exceed the fair rate customary in the industry. to be certified by the certifying accountant, and in no event exceed 10 per cent, of the total cost of production. 15. There should be established a tribunal (which might be the present Advisory Committee) autho- rised to accept for registration British films which have cost less to produce than the minimum in- dicated above but which, on account of their out- standing merits or for other reasons, are, in the opinion of such tribunal, worthy of registration as British films. 16. Sub-section (4) of Section 27 of the Act should be amended to provide that, where a British film failed to secure registration solely because its pro- duction cost was below the stipulated minimum, any such disallowed British film should not be deemed to be a foreign film, but should be placed in a neutral category that does not require British quota. 17. Sub-section 3 (iii) of Section 27 of the Act. which requires that the author of the scenario must be a British subject, should be repealed. Similar recommendations have previously been made by trade organisations and by the Advisory Committee, and we understand that it is now generally agreed that this requirement is no longer necessary. 18. In order to discourage excessive payment- to foreign technicians and artistes for the purpose of swelling the total cost, for example, by producing units in this country making use of the services of persons employed by associated organisations in foreign countries, we recommend the retention of sub-section 3 (iv) of Section '27. which requires that 75 per cent, of the salaries, wages and payments for labour and services in tin- making of a British film shall be paid to persons of British nationality or domicile. MINUTES OF EVIDENCE 155 14 July, 1936.] Mr. G. R. Hall Caine. [Continued. Small Renters. 19. We have carefully considered the position of small renters to whom British films costing the pre- scrihed minimum might be financially out of scale with their normal business in foreign films. We recognise that renters of this class fill a necessary place in the film industry and that our proposal for a tribunal empowered to recommend the special registration of films which cost less than the statu- tory minimum does not meet the need of them and minor producers for the assurance that films that satisfy all the requirements of a British film except that of cost will be registered on completion. The grant or refusal of registration would appreciably affect the commercial value of such films and the absence of an assurance of registration would seriously handicap persons who desired to make and rent them. At the same time it would be necessary to secure that any concession made in this matter should not be taken advantage of by renters for whom it was not intended. It may be difficult to prevent the abuse of such a concession, but we sub- mit in Appendix A to this report an outline of pro- posals for dealing with this matter subject to adequate safeguards. Special registration of films falling within the excepted classes. 20. We suggest an amendment of Proviso (i) to Section 27 (1) to enable films of any of the excepted classes submitted for registration under that proviso to be registered either for the renters' and ex- hibitors' quotas or for exhibitors' quota only. As such films would be submitted for exceptional regis- tration on the ground of their special exhibition value, they could be admitted on that ground not- withstanding that they might have cost less than the prescribed minimum. 21. The main object of the proposed cost test is to prevent the making of films cheaply without regard to quality, merely for the purposes of the renters' quota. Films registered under Proviso (ii) of Section 27 (1) do not count for renters' quota, and accordingly there is little incentive to the renter to acquire them unless they are of marketable quality. Accordingly we think that films of the classes eligible for registration under this Proviso should not be required to comply with the minimum cost test. A i l.-FiLM Quota. 22. For the reasons stated in the Report on Short Films made by the Advisory Committee to the Board of Trade in February 1933,* the substantial production of short films in Great Britain under existing conditions does not appear to be commer- cially practicable, and in consequence the number of such films registered has at all times been insufficient to enable either renters or exhibitors to cover their foreign short films by British short films. Tbe effect of tbe all-films quota, therefore, has been to compel the acquisition and exhibition of long films substantially in excess of the long films quota. 23. We therefore recommend that, if the proposed cost test be adopted, the all-films quota, which in- cludes both long films (3,000 feet and over) and short films (films of less than 3,000 feet) should be abolished, and the renters' and exhibitors' quotas be limited to long films only. Renters' Quota. 24. We further recommend that the renters' quota should continue to be related to a percentage of the footage of the films acquired. The footage of British films required by a renter on this basis would deter- mine his statutory financial liability. He should be permitted to discharge this liability either by acquir- ing the statutory footage at the minimum cost of £2 a foot, or by a less footage at more than the * Printed as Appendix B. minimum cost, subject to a maximum of £4 a foot. For example, the financial liability of a renter for whom the footage quota represented 50,000 feet would be not less than £100,000; this sum might be spent, say, on eight films of 6,250 feet each at £2 a foot, or on. four films of the same length at CI a foot. In so far as the alternative of acquiring fewer but more expensive films were adopted the quality of the films made might be expected to improve, but the number of films available to exhibitors from renters who complied with, but did not exceed the quota, would be less. The output of films from the major renters representing British interests would, however, presumably not be affected in that way and might be expected to expand so that the footage of British films registered by renters as a whole might be not less than the statutory footage quota for individual renters. Exhibitors' Quota. 25. The adoption of our proposals for a minimum cost test, for its application to the renters' quota, and for the abolition of the all-films quota would result in a substantial reduction in the number of registrations of British long films. On the other hand, the abolition of the all-films quota would also reduce the number of British long films required by exhibitors for quota purposes. Moreover, while the British films available, if they were equally distri- buted, would doubtless be more than sufficient to enable all exhibitors to comply with a quota equal to that of the renters, the conditions in competitive areas, from the pressure of circuits and in other ways, frequently make it difficult for independent exhibitors to obtain an adequate number of such films. We think it essential that the exhibitors' quota should be fixed at a lower percentage than the renters' quota and we recommend that the renters' quota being 20 per cent, the exhibitors' quota should be 15 per cent. " TBT-OUT " EXHIBITIONS OF FILMS BEFORE TBADE SHOW. 26. We understand that " try-out " exhibitions of films to the public before trade show for editing purposes are illegal but that provided a film is so exhibited on one occasion only without advertisement the Board of Trade take no exception to the practice. We agree that such " try-outs " should be permitted and we recommend that they be legalised by an appropriate addition to Section 5 (1). Duration of the Act. 27. In spite of the defect which experience has revealed, the Act has undoubtedly been an important factor in the remarkable growth of the film pro- ducing industry in this country in recent years. In our opinion its main principles have proved, during the period of nearly seven years which has elapsed since it came into force, to be sound and we think that, if the defects referred to in this report were remedied, it would continue to benefit the British industry. (Sgd.) ARNOLD WILSON (Chairman). On behalf of the undermentioned members of the Cinematograph Films Advisory Committee, namely : — Mrs. H. A. L. FISHER Mr. P. GUEDALLA. Mr. CR. HALL CA INK Mr. J. HALLSWORTH. Mr. K. BEWITSON Mr. A. B. KING,* Mr. J. MAXWELL* Mr. S. W. SMTTH, Mr. B. TROUNSON, Mr. C. M. YVnOLF. * Subject to the reservations appended hereto. 156 COMMITTEE ON CINEMATOGRAPH FILMS 14 July, 1936.] Mr. G. R. Hall Caine. [Continued. Reservations by Mr John Maxwell. With regard to the Committee's proposal for the retention of Sub-section 3 (iv) of Section 27 of the Act, I consider it desirable, in view of the fact that it is proposed to require foreign interests to make bigger and more expensive pictures, to give a little more latitude as to the salaries paid to foreign artists or Directors. I think there should be an in- crease from one to three of the persons who may be excluded under the sub-section. In view of the enlarged scale on which British production is embark- ing, in order to secure distribution in the American market, it is now recognised as necessary to introduce important foreign stars into British pictures to make them saleable all over the world. Even if two im- portant foreign star artists and a Director were included it would not make a film any the less a British picture if it were made here, but to widen this clause would make it possible for American com- panies to bring over outstanding stars without endangering the possibility of the picture being entitled to quota. T think this is a very important point at the present time. Nobody would suffer in this country — indeed, it would help employment here by making it possible to make bigger and more expensive pictures. (Sgd.) JOHN MAXWELL. Reservations by Mr. A. B. King. I am in general agreement with my colleagues on the proposals contained in the report. I consider, however, that the 15 per cent, suggested as the Exhibitors' quota is excessive and should be 10 per cent. The proposal to include a cost factor to be applied to British films for quota purposes and the suggestion that films costing £4 per foot or more should count for double the quota so far as the Renters are con- cerned, will undoubtedly reduce the number of British films available to exhibitors. I do agree that these proposals will encourage the production of better films and discourage the pro- duction of cheap " quickies " which are doing so much harm to the reputation of British films gener- ally. Having regard to this and also to the desire- ability of leaving the Exhibitor with some power of selection, I think there should be a substantial margin between the Renters' quota and the Exhibitors' quota. Without such a margin, the Renter is in- clined to rely too much on the Quota Act to secure bookings, with the result that there is not sufficient incentive to improve the quality of product. In view of all these circumstances, I have come to the definite conclusion that the Exhibitors' quota should not exceed 10 per cent. I am also strongly of the opinion that, should the period of the Act be extended, power should be given to the President of the Board of Trade to vary the prescribed quota percentage as conditions in the Industry might render desirable. (Sgd.) ALEX. B. KING. Recommendations by Mr. O. P. Metcalfe. I have carefully considered the report agreed upon by the majority of my colleagues on the Cinemato- graph Films Advisory Committee on the subject of the amendment of the Cinematograph Films Act, 1927 ; and desire to submit the following observa- tions upon it and also some alternative and additional proposals. 1. Blind Booking and Advance Booking. 1 agree that the provisions in the Act have been generally disregarded. Such disregard is evidence, 1 think, that the trade does not want them. There- fore my view is that those provisions should be abolished. In so far as they could be made effective they would have a had influence on the development of the industry because they would operate unfairly as between the independent producers and independent exhibitors on the one hand and those producers who are controlled by or who control cinema circuits on the other hand ; these provisions of the Act can never be operated against the last named class. If it is decided to retain the provisions in spite of their disadvantages I am of opinion that the recom- mendation of the Committee to provide for a " Statutory Declaration " would be absolutely in- effective because it would not assist in the detection of offenders. To assist detection the penalties should be limited to one of the parties only, and, as every contract for the hire of films originates in an offer made bj a renter, my view is that the penalties should apply to the renters only. Further, if these provi- sions are retained the Act should provide a simple system of registration of all film hire contracts with power to inspect them. 2. Quality Test for British Films. I am in full agreement with the object of the Com- mittee which is to bring into existence better quality quota films, but I do not believe that a cost test, per se, would accomplish that object and I am strongly opposed to a cost test based on footage. My opinion is that all British Films should be allowed to rank for exhibitors' quota, but that only those British films which successfully pass a quality test should be allowed to count as quota against foreign film imports. In that way British producers and British renters would not be' interfered with. All the films they make are genuinely intended to be good ones, and if, occasionally they produce a bad film, as is in- evitable, it is their misfortune and they should not be penalised for it. The foreign renters' case is different. They are undoubtedly unwilling to make good quota films, just as they avoid -making a foot more British film than the Act> compels them to make, so they will continue to make films of the poorest quality possible, quite independent of their cost. They will only make good quota films when they are compelled to do so and the only way to compel them is to impose a quality test. The British Board of Film Censors requires films to register up to a certain moral and ethical standard, so surely it is quite as reasonable to demand that they register up to a " production " standard, not necessarily based solely on box office values. The argument that it is impracticable to impose a quality test is apparently not shared by the Advisory Committee, for they recommend such a test in the cases of films costing less than the suggested £2 per foot. My opinion is that foreign renters' quota should be based on two dimensions: — 1st Footage as at present. 2nd Quality. 3. Cost Test. If it is thought necessary to add a cost test, the cost should not be based on footage. A cost test such as is recommended by the Committee would prevent certain types of films which do not earn large sums at the box office, but which are neverthe- less in demand by many cinemas, from being imported, as the cost of quota against them would be prohibitive. Tt -would put a premium on extravagance, put some of the smaller producers out of business, would re- strict expansion and would tend to create monopolies by preventing new production units from coming into existence, unless they were very heavily financed. Any cost quota should be based on the foreign renters' revenue from the hire of films. I suggesl it should be the same percentage of such revenue as the footage quota is of his release footage. Unless a quality test is imposed exhibitors' quota should be abolished entirely. MINUTES OF EVIDENCE 157 14 July, 1936.] Mr. G. R. Hall Cainb. [Continued. I am opposed to the recommendation that films costing £4 per foot or over should be allowed to count double for renters' quota. I am of opinion that power should be given to the President of the Board of Trade to vary quotas and other similar provisions from time to time, as conditions of the trade may make desirable, or they should be capable of alteration by " Orders in Council " or other similar means. The scope of the Act should be extended to provide a scheme of compulsory arbitration in the case of certain classes of dispute arising between different sections of the industry. (Sgd.) CHAS. P. METCALFE. Recommendations by Mr. F. W. Baker. I am in general agreement with my colleagues on the proposals made in the Report F.A.C. 164 under the following headings: — Blind booking and advance booking. Special registration of films falling within the excepted classes. All films quota. Exhibitor's quota. " Try-out " exhibitions of films before trade show. Duration of the Act. I am also in agreement with the main principles of establishing a quality test (for British films to fill Renter's quota) based on a value, but I am of the opinion that basic cost per foot would be more easily administered if applied only to British salaries and wages shown on the Registration Form " C " than if applied to the total cost of the film. I am opposed, for the following reasons, to the recommendation that the quality test should be applied to all British films. (1) The proposals are against public interest in as much as they are restrictive and cannot fail to discourage entry of new production units, resulting in a decrease of " worth while " British films. (2) That the recommendations would tend to reduce the number of films available to exhibi- tors and it would appear that any fixation of a minimum price per foot for films before they can be registered as British would tend to impose hardships on small or independent renters and a deterrent upon initiative. (3) The small or independent renter should receive full consideration as he has not the entry to the circuits controlled by the two major British Companies which, by reason of their exercising the combined functions of production distribution and exhibition, are able to ensure the exhibition of the product they have made and which they rent, and whose position for dis- tribution would be favoured by a reduction in the total number of British films available for offer to exhibitors. (4) The proposals as to cost would tend to drive out of business small or independent rent- ing organisations and would thus give a virtual monopoly to the few larger British Renter/ Producer/ Exhibitor concerns. During the 12 months ended 31st March, there were 106 long British films registered by foreign Renters and 88 registered by British Renters. Of these 88, 54 were distributed by the two larger British companies, leaving only 34 distributed by small British Renters. It will be appreciated that a vast number of independent Exhibitors are unable to obtain, upon terms satisfactory to them, any of the 54 films rented by the two major British concerns and are in consequence, forced to fill their British quota from either the 106 British films rented by foreign Distributors or by the 34 rented by small British Renters. Any diminution in this last number must be detrimental to the independent Exhibitor as tending to put him in the position that, desiring to exhibit some of the attractive films distributed by foreign Renters, he will find it an obliga- tion, in order to acquire such films, to book at prices dictated by those same Renters, the British films distributed by them. At the present time, much of the opposition emanating from the Exhibitors against " Quickies " arises from the fact that in order to acquire the attractive foreign films rented by foreign Distributors, they are obliged to obtain the " Quickies " offered by the same Dis- tributors to fulfil their Quota obligations. (5) The proposals in regard to British films placed in a neutral category are unsatisfactory as these films would, by their definite limitations not be required by Exhibitors and would there- fore involve the Renters in considerable addi- tional difficulties in distribution. I note in the Report that it is thought that the suggestion for the quality test might fall hardly upon small renters with the result that an appendix was attached to the Report, giving an outline of proposals for a modified standard minimum cost for such renters. In my opinion such proposals open up a grave difficulty that any small renter who desired to take advantage of such proposals would find the conduct of his business entirely dependent upon the attitude, sympathetic or otherwise, of the Board of Trade. I am also of the opinion that the suggested tribunal authorised to accept for registration British films which have cost less to produce than the mini- mum, could not be a satisfactory commercial proposition. The Report clearly shows the unanimous conclusion arrived at by the signatories is that the " Quickie " is a defect of the Act. I would suggest, therefore, proposals which, in my view, deal with that aspect but confine themselves thereto. I propose that the Act be amended so as to require renters to acquire British footage in proportion to the foreign footage registered and upon such British footage a quality test, by means of a price per foot, be applied. This would leave any renter free to offer in the ordinary course of business, and without the means of exerting pressure on exhibitors, other British films which have complied with the con- ditions of Section 27 (3) of the Act but have mo limitation or requirement as to cost. Any British picture would, under this proposal, be able to be counted as quota by the exhibitor, but would not count for quota for the registering renter unless it complied with cost requirements. I suggest that this proposal would not encounter any of the objections which I have indicated above as being applicable to the scheme favoured in the Report in Memorandum F.A.C. 164, some of which objections are so obvious that the signatories of the Report have had to suggest ways of overcoming them. On the question of setting up a price standard or> British films to comply with renters' quota, I would suggest that consideration be given to a formula which would vary the price per foot for different renters by a sliding scale based on foreign footage registered, the scale ascending in proportion to the rise in footage. (Sgd.) F. W. BAKER. 37873 !•'. 158 COMMITTEE ON CINEMATOGRAPH FILMS 14 July, 1936. J LConrinuetf. APPENDIX A. 8 mall Renters. Outline of proposals for a modified standard minimum cost for British films acquired for the purposes of the renters' quota. Any renter who considered that British films of standard statutory cost would not be financially practicable for him might be given the right to apply to the Board of Trade within, say, two months of the beginning of a renter's quota year to have that cost related to his gross receipts from foreign films in the previous quota year, and the Board of Trade, after consultation with the Advisory Com- mittee, might be authorised to fix such lower stan- dard statutory cost as might appear to them to be reasonable having regard to all the circumstances of the case. The conditions of eligibility for registration of films as British for the purposes of that renter's quota would then, in the year of the application, be the general statutory conditions with the excep- tion that the minimum cost would be that fixed by the Board instead of £2 a foot. Any film registered under these conditions should be allowed to count for renter's quota only by the renter concerned. Any excess over the reduced standard cost should not entitle the renter to satisfy the quota by a reduction of footage except in so far as the cost exceeded £2 a foot. The reduced cost standard should continue in force only during the year in respect of which it was fixed by the Board of Trade. Application might, however, be renewed annually if desired. Statements of gross receipts in support of claims should be furnished in a form to be prescribed by the Board of Trade and should be certified by an accountant being a member of an Incorporated Society of Accountants. The Board of Trade should be empowered should they think fit to require the renter to submit his accounts to investiga- tion by an independent accountant appointed by the Board and to pay the expense of the investigation. The concession should be limited to renters who did not acquire more than a limited number of long films in a year or whose average gross receipts for each film did not exceed a specified amount and the Board of Trade should be given discretion to regard allied and associated companies and organisations as a single renter for the purposes of the concession. APPENDIX B. The Right Honourable the President of the Board of Trade. February, 1933. Sir, 1. As you are doubtless aware the quota pro- visions of the Cinematograph Films Act, 1927, must be satisfied as regards both long films (i.e. registered films of 3,000 ft. or upwards) and all films. In con- sequence an excess over the long film quota may be offset against a deficiency of British short films (i.e. registered British films of less than 3,000 ft.) for the purpose of satisfying the all films quota, but an excess of British short films may not count towards the long film quota. 2. We have observed from the statistics of registered films periodically furnished to us by the Board of Trade that whereas the production of British long films since the Act came into force has more than kept pace with the periodical increases in the statutory quota, the production of British short films has failed to do so. During the lasti renters' quota year ended 31st March last, when the quota was 12J per cent, while the percentage of British long films to all long films registered was as high as 25, the corresponding figure in the case of short films was only 6-2. We have also observed that many of the exhibitors whose quota defaults have been submitted to us for consideration have defaulted in respect of the all films quota only, any excess on the long film quota having been insufficient to make good the deficiency in the British short films exhibited. 3. In these circumstances we have considered it desirable to investigate the difficulties attending the making of short films in this country, and how those difficulties may be surmounted. For this purpose Mr. Rowson, one of the renters' representatives on the Committee prepared a memorandum on the subject for our information. A copy of this memorandum is attached. 4. The memorandum takes the view that the diffi- culties attending the making of registered British short films arc commercial rather than technical, and that under present conditions the making of such films does not, and probably cannot be made to pay. Those conditions are attributed to a numbei of causes including: — (a) The concentration of exhibitors on bhe feature items of their programmes leading to a comparative neglect in the selection of the short items ; (o) the great excess in the supply of short films, mostly foreign, over the demand; (c) the prevalence of the trade practice of selling feature films on sharing terms under which renters supply supporting programmes, the majority of which include shorts, thus seriously restricting opportunities of selling good shorts independently at commercial prices; (d) the growing practice of exhibitors of adding a second feature film and sometimes one or more variety items to their programme in substitution for short films; (e) the absence of practically any sale for British shorts outside the British Isles, with the result that the entire cost of such films must be recovered in the home market ; (/) the over-supply of British long films beyond those required for long film quota pur- poses, which has restricted the demand for British shorts to cover quota liabilities for the foreign shorts shown ; (g) the operation of the "series "' clauses of the Act, as administered by the Board of Trade with the advice and approval of the Advisory Com- mittee, which tends to reduce the commercial possibilities of British shorts. 5. We have discussed at length the possible methods of overcoming these difficulties. It is clear that some of the remedies which have been suggested to us would depend for their effectiveness upon the extent to which they were generally adopted by the film trade itself, while others might be put into operation by administrative action on the part of the Board of Trade. 6. In some respects, however, we are of opinion that the situation might be materially improved it it were found possible to make certain amendments to the Cinematograph Films Act. 1927. The amend- ments which we suggest for consideration are as follows : — (a) Under Section 27 (2) of the Act. " serial film or series of films means a serial film or series of films comprising a number of parts not exceeding 26, each part not exceeding 2. ft. in length, intended to be exhibited on successive dates at intervals not exceeding fourteen days." We are of opinion that the relaxation of the requirement fixing two weeks as the maximum MINUTES OF EVIDENCE 159 14 July, 1936.] [Continued. interval between consecutive exhibitions of parts of a serial film or series of films would tend to an increase of business in short films by permitting greater elasticity in the arrange- ment of dates of exhibition. We recommend the amendment of Section 27 (2) of the Act for this purpose ; (6) we are also of opinion that, notwithstand- ing the restrictions imposed by the Act upon the blind booking and advance booking of films, the introduction of a system whereby short films might be sold to exhibitors on an indefinite service or running contract similarly to " news " films, subject to provision being made for the termination of contracts by reasonable notice on either side, is desirable. We therefore recommend the amendment of the Act to permit the introduction of such a system. 7. We understand that you are considering pro- posals made to you in April last by a deputation representing the Film Group of the Federation of British Industries and the General Council of the Trade Union Congress for the amendment of the Cinematograph Films Act, 1927, in certain respects, and we therefore venture to urge that amendments on the lines of those we have recommended should be considered at the same time. On behalf of the Cinematograph Films Advisory Committee. (Sgd.) L. N. GUILLEMARD. Chairman. THE PROBLEM OF BRITISH " SHORTS." " The difficulties attending the making of short films " (i.e. registrable and therefore counting for quota) — referred to in the question put at the last meeting of the Committee, are merely commercial. Under present conditions they do not pay, and I believe they cannot he made to pay so long as those conditions prevail. Exceptional cases may arise from time to time, when a satisfactory commercial return for special shorts may occur, but these are so rare that the general conclusion in the previous sentence may be regarded as fully conforming with experience. A statistical measure of the problem is provided by the information contained in the tables prepared by the Board of Trade for the Advisory Committee. These show that in the year ending March last the length of registered British shorts amounted to 7-3 per cent, of all British films whereas foreign shorts amounted to 26-6 per cent, of all foreign films. There is thus an enormous disparity in the propor- tions of British and foreign " longs " and " shorts " respectively on the (market. In the first case there is available nearly 13 feet and in the second case only three feet of long film to each foot of short. The following figures give, I believe, a more in- structive view of the statistical sitnation. In the last quota year (i.e. April, 1931-March, 1932), when the quota liability was 12^ per cent., British " shorts " registered by renters amounted to 6-4 per cent of all " shorts," whereas British " longs " amounted to 23-9 per cent, of all " longs." If the production of British " shorts " had grown pari passu with the production of " longs," nearly four times as much " shorts " would have been produced. If British " shorts " had been produced to satisfy the quota requirements in respect of short films without trenching on the long films for this purpose, nearly twice as much British " shorts " would have been prodiu -I'd. The figures, by themselves, are not conclusive in proving a shortage from the point of view of the exhibitors. There might be an average of twice as many showings for British " shorts " than for foreign ; in that case there would not be any shortage of British films. But taken in conjunction with the hundreds of returns from defaulting exhibitors which have come under the review of the Advisory Com- mittee, nearly all of which show that short films are in greater deficiency than long films, we may re- gard it as definitely established that there is an unquestionable deficiency in British " short " films. There are many causes contributing to this result. Some of these may he of small importance, but to- gether they suffice to overwhelm all the efforts and enterprise of the most commercially-daring manufac- turers and the most skilled distributors. The first of these causes arises from the concen- tration of the exhibitor on the feature item of his programme for his attraction. On this he con- centrates all his publicity presentation values, and attention, to the comparative neglect of the " shorts " items in his programme. These items are put on, frequently without rehearsal, sometimes with- out examination of condition, and much too often without any regard for the character of the neigh- bouring items. Everything is done to concentrate the entire attention of the public on the feature, and success in the cinema is made to depend only on the agreement of the public with the exhibitor on his feature selection. The effect of this kind of show- manship, .whose wisdom need not be questioned, is that the exhibitor has little interest in his " shorts," and he is convinced that the public are equally dis- interested. In filling up his programme with " shorts " he is accustomed therefore to choose what is cheap rather than what is good, and the pressure tends always to bring prices downwards. For this reason the market price for " shorts " tends to become too low to become commercial. Again, the supply of " shorts " is much greater than the demand. Out of a programme containing 140 minutes of registered subjects it is doubtful if ever more than 20 minutes or 14 per cent, will be given to " shorts." Yet the figures quoted show that the length of " shorts " offered by the renters amounts to more than 22 per cent. The jostling competition of this over-supply for the limited market brings about a still further tendency to depress prices. Perhaps the most serious contributory cause to low prices is the trade practice which has grown up in recent years among renters. In their insistence on " sharing terms " for their feature films to take the place of the old " flat rate " which was common in the old " silent " days, renters have found them- selves compelled to supply a supporting programme — consisting of, in some cases, a second feature, but more frequently one or two comedies. The exhibitor generally leaves the selection of these supporting items to the renter who, in his turn, has been tempted to supply such " shorts " as could not bo sold independently to the exhibitor. Not only is the reputation for " shorts " destroyed or depreciated by these means, but the available free market into which worth-while " shorts " might be sold is very consid- erably restricted. There is no doubt whatever that this practice in recent years, encouraged by the depression, has reduced very considerably and very seriously the opportunities for selling good " shorts " at commercial prices. One more contributory cause may be mentioned. To meet the prevailing depression in the industry, ex- hibitors have very extensively adopted the practice of adding a second feature and sometimes one or more " turns " to their programmes, in order, by such a combination of added attractions, that some improvement in the box-office returns might be achieved. Whether these practices have averted the box-office depression need not be discussed here : we are concerned only that these changes have made further encroachments on the time in the programme not occupied by the " star " feature attraction. The conditions described so far apply to foreign and British " shorts " alike. There are however certain other conditions which affect adversely British " shorts " even more than foreign " shorts " The first of these is the absence of, practically . / sale whatever of British " shorts " in any market outside the British Isles. Even more therefore than in the case of long subjects — for which some market KiU COMMITTEE ON CINEMATOGRAPH FILMS 14 July, 1936.] Mr. G. R. Hall Caine. {Continued. is growing in the Empire and even in the U.S.A. — the entire cost of " shorts " must be returned in the home market. These are therefore at serious commercial disadvantage in competition with foreign " shorts ". The enormous over-supply of " long " British features beyond what is required for " long " quota purposes, has restricted the demand for British " shorts " to cover the quota liability for foreign " shorts " shown. The demand which it was hoped therefore that the Act would create for British " shorts " has, in fact, not been realised. Finally, the operation of the " series " clauses of the Act — as administered by the Board of Trade with the advice and approval of the Advisory Committee — tends further to reduce the commercial possibilities of British " shorts ". In order that the sale of " shorts " should not be loaded with too heavy a burden of sales costs, the Act made special provision for the sale of any number of " shorts " up to 26, so long as the first three were booked from time to time, for exhibition within the booking period. For administrative purposes it has been found necessary to limit the definition of " series " very considerably, and some time ago the trade was asked to impose on itself, voluntarily, the condition that it would not seek to register more than 13 numbers in a series at one time. The result is that British manufacturers are compelled to limit their attention to subjects which will unmistakeably comply with the " series " test of the Board of Trade, and /or which can be sold separately to exhibitors. This, in practice, proves to be a very definite and appreciable handicap on the commercial exploitation of British " shorts ". The obvious conclusions for the foregoing dis- cussion are as follows : — 1. If British " shorts " are desired by ex- hibitors, they must reserve a portion of their programme for them. This might be done either by reserving a small percentage of their playing time for British " shorts ", or by reserving for British " shorts " at least the quota percentage of foreign " shorts ". 2. The introduction of a wider definition for " series " so as to admit a greater variety of subjects for registration as a " series ". 3. The restoration of the practice permitting 26 subjects to be registered in a series. 4. An amendment of the two-weeks maximum interval between consecutive exhibitions of subjects in a series. 5. The introduction of a system whereby " shorts " might be sold to exhibitors on an indefinite service contract, similar to the " news " film. These changes would, no doubt, have the effect of making the manufacture of " shorts " a better com- mercial possibility than at present. I refrain, how- ever, from saying whether I recommend them, until the views of other interests can be made known upon them. (Sgd.) S. ROWSON. 4th July. 1932. 1711. (Chairman): We have been looking forward to this opportunity because we appreciate that your Committee have been examining the same subject. They have had long experience in the administration of the Cinematograph Films Act and have given the matter much thought, the results of which "we should like to have at our disposal? — I shall be only too happy. 1712. So may I just ask you a few questions. The Report is very clear in its recommendations. In paragraph 6, as to provisions to combat blind and advance bookings, you suggest that there should be a statutory declaration. Would it be useful to go further and, where the offence is proved, cancel the registration of the film ? That would be a very strong penalty? — I think you can only tackle the subject by bringing in the strongest possible penal- ties. If I may just explain for a moment : this is a problem in regard to which you will find you have to protect somebody from himself. In the beginning, at the time of the introduction of the Bill which is now an Act, the exhibitors, if you remember, came to the Government complaining that they were under the heel, as you might say, of the foreigner, and saying that this blind and block booking was throttling the industry. Producers particularly said so. The point of the exhibitors with regard to block booking for two years, as they were doing at that time, was that in two years' time the film that they had booked was usually out of date. That was the problem which primarily the Act set out to solve: to make an outlet for British films and to release the exhibitors from the thraldom of the foreign renter and producer. It worked very well for a little time ; and then the exhibitor, being weak, gave way to the blandishment, shall we say, of the foreign renter, and gradually weakened and weakened and began to break the Act. Quite frankly, we have not found it possible to stop that gap. This docs not stop it. 1713. A declaration will not stop it? — We do not pretend that this stops it; we think it will act as an additional deterrent. 1714. We have had a suggestion made— it may lie in one of your minority reports — that penalties should only lie against the renter and not against the exhibitor. Do you consider that possible? — I think if you make the penalty on both sides you always have the difficulty of finding someone to turn King's evidence; if you make the penalty on one side, at any rate you have a little more hope of getting some evidence. Our difficulty always has been to get somebody to give evidence. 1715. Am I right in thinking it was in one of your minority reports ?■ — -Yes. 1716. You approve of that? — I think it should be on one side only, yes, I do. 1717. And you approve of the cancellation of registration as a penalty, do you? — Yes, I do certainly; I think the stiffer you can make it the more complete will be the deterrent ; but I do not think you .will completely stop it by this method. I am sorry ; but we put forward this recommmenda- tion in the hope that it would add an additional deterrent. 1718. Do you think you can go further than this in dealing with block booking, because I take it block booking is a great evil apart from the blind book- ing ? — Yes. 1719. Could you deal with what we understand sometimes happens : the renting of a film that is much desired only on condition that less desirable ones are taken? — That it so. 1720. Do you think it is possible to deal with that by any statutory provision ? — I think it would be most desirable if we could stop that form of bribery. if I may use the word, by which they say: You shall have a Charlie Chaplin if you .will take a lot of this other stuff. That is block booking ; in a sense it is both blind and block, because they have not seen any of them. 1721. Have you got any definite proposal for deal- ing with that allied difficulty? — No; the difficulty with which you are faced is the fact that it is at present illegal but you cannot get any evidence to stop it. 1722. It is not illegal to block-book — to agree that you will take the whole of somebody's output pro- vided it is not against the blind booking or the advanced booking? — I see what you mean, if it is within the ambit of the Act? MINUTES OF EVIDENCE 16] 14 July, 1936.] Mr. G. 11. Hall Caine. [Continued. 1723. Apparently it is quite legal within the limita- tions of time? — Within the limitations of time, of the 6 months and the trade show. 1724. And, of course, you cannot prevent it where the renter goes out, as, for instance, in this new amalgamation of which we have read in the last day or two ; then there is nothing to prevent block- booking against the interests of other producers in this country? — That would be a block-booking within your own circuit ; that I am afraid it is going to be very difficult to prevent. 1725. There would not need to be any contract? — No. 1726. It would be the natural procedure: they would sell to their own subsidiary ? — Yes ; but then you get over that perhaps in another way, by the later date, where we put forward the test of what shall be. 1727. Yes. Then in paragraph 14 you recommend a cost test on the basis of not less than £2 per foot ? — Yes. 1728. And you go on, I think, to include certain specified headings and to exclude certain other head- ings in arriving at the cost. Could you tell us how your basis differs from that under Form C, and whether it really is better than Form C, which I believe works out to something like 50 per cent, of the total cost on the basis of experience? — Yes. It differs in this way : we sat down to consider in what way our cost test could be avoided ; I mean how they could still comply with it and yet spend the money in ways which would not be altogether shown in the quality of the picture shown on the screen. For instance, we felt that we should exclude the cost of copyright of the story, because it is possible to give very large figures for copyright.; of film stories. We also felt that the payment for directors could be very extravagant and perhaps out of all proportion to the value which the director contributes to that picture; at any rate, it was a means of avoidance. We felt that the author of the scenario might be used or the various authors might be used in some ways. In other words, to put it quite frankly, these are the best ways we know by which to make a picture seem to cost a lot of money and really not cost the company much at all. 1729. You think Form C gives an opportunity for cooking? — Yes; we think this is an improvement. 1730. As against the basis of Form C, you re- commend this as being more watertight? — These are to the best of our knowledge and belief and the best expert advice we can get; any money spent on this; must definitely go into the film itself. 1731. I wondered whether there would be ad- ministrative complication in having two bases of com- putation?— I do not think so, because the four that we exclude are very easily ascertainable. 1732. In paragraph 16 you propose that films which do not qualify before the tribunal on your basis of cost should be placed in a neutral category? — Yes. 1733. And not be counted for quota. The pro- ducers have I think proposed to us that they should count for exhibitor's quota but not for renter's quota ? — Yes. 1734. What do you feel about that?— Well, I think there is some disadvantage to the young and enter- prising and genuine British producer if you make a cost test the only test of the quality of a film ; and it was brought to our notice very strongly that there was in his country a rising number of young producers — when I say " young " I mean new pro- ducers— who were making perfectly genuine British films without having the overhead costs which some of the bigger companies had to bear; and this was put in in order to try and find a means of encouraging these smaller but quite genuine British producers ;is opposed to the people who are definitely trying to avoid compliance with the Act. 1735. These are British films and you recommend that they should be placed in a neutral category that does not require British quota; that really means 37873 it would not count for British quota? — Yes; what we mean is that they do not count against the exhibitor. 1736. They do not count against foreign. Well, would you see objection in the producers' suggestion that they should count as quota but that they should be stigmatised and labelled? — No. 1737. Or that they should be without the label of the quota? You .would have them right out of the quota altogether? — Yes; my Committee took the view that they would prefer that to be the case; but they do not like the idea that they should be stigmatised, because I know that that point was raised against us when we made this suggestion : that it would rather make fish of one and fowl of another ; but we do not feel that. If these films were passed by some Committee, whether it be the present Advisory Committee or otherwise, we think they .would rather be accentuated in value than lose in value, because we would have said that although this picture does not come up to the £2 standard, it is a very good picture. That is really what we are saving in point of fact. 1738. But those are for the pictures which are admitted to quota because of quality? — Yes. 1739. But the pictures which were not admitted to quota either because of cost or quality — it was not proposed that they should be stigmatised, and that was one of our difficulties. It is quite right : I mis- represented the suggestion. You would only stigma- tise the low quality picture that does just squeeze through the cost qualification? — Yes. 1740. And it was suggested that both the worst pictures which did not rank for quota and the best pictures that had not been counted for quota would equally be in an unlabelled category? — Yes. If a picture is not of merit of that kind, I do not think it should. The .whole idea is to raise the standard of the quota picture, and if you allow any loophole of that sort I think you might open a gate. 1741. They would not count for quota, and there would be no inducement then on the exhibitor to show them? — Yes. 1742. Perhaps you would develop what you say about small renters and as to the necessity of com- plicating the qualification on the cost by varying standards? — Well, that is what I was saying just now, Sir: it is beause we felt that it might be a serious handicap to the coming new British pro- ducer, who is in earnest and trying to come in but who has not yet got sufficient capital and who is not handicapped by having very distinguished stars on his salary list and other very high expenses, but still can produce a thoroughly good picture, that we tried to find some means of encouraging that type of producer. 1743. Then perhaps I misunderstood it : these films .would only he registered but would not rank for quota ? — Yes. 1744. I am looking at Appendix A. You say it would raiA for quota? — Yes, we do let them rank. 1745. That seems to me to be rather a difficult provision ; I should have thought that the new category which did not rank for quota would give an opportunity for these young producers to sell their films on their merits; but if you once let them rank for quota, is not it going to be making a very big hole in your protection? — Well, the disadvantage of the scheme is this, as I am sure you will appre- ciate: that you are having a cost test and a quality test at the same time. The cost test was supposed under reasonable circumstances to give us in advance and blind-book them, even when ihe exhibitor has known that he has been breaking the law. 1788. Quite; but if the thing booked in advance were not in itself undesirable, would thai advance booking really matter very much? — No, not so much; it would only matter from another point of view. 1789. Would not you agree that in general it should be the purpose of legislation to deal with the central trouble in the industry, and, in so far as it can deal with that central trouble, to leave 37873 F 2 164 COMMITTEE ON CINEMATOGRAPH FILMS 14 July, 1936.] Mr. G. R. Hall Caine. [Continued. other matters to settle themselves? — Yes, I do take that view. 1790. Then it follows from that that we should con- centrate upon the elimination of the quickie? — Yes. 1791. Mr. Holmes was putting some questions on that and the same kind of question was in my mind. In paragraph 14 you set out the items to vvliich the Chairman has referred? — Yes. 1792. Would you agree that it might be very difficult to compel disloyal producers to deal with you honestly under this kind of specification? Imagine, for example, the case of the distinguished performer who worked for one of the big syndicates in America and in this country; would not it be easy to overpay that person in respect of an English appearance and to underpay him in respect of appearance in America? — Yes, but if you will look further down, Sir, I think you will find we do have the right to disallow. I mean it may be only in ex- treme cases, hut we have &■ right even to go so far as to disallow a charge or to reduce it if we think it is excessive. 1793. (Chairman) : You propose an average too? — I think we have. 1794. (Chairman) : It is towards the end of para- graph 14. I do not know whether that would be effective. 1795. (Dr. Mallon) : Yes, I see that, and that is to some extent a check ; hut generally might there not be considerable difficulty in ensuring the loyal fulfil- ment of the prescribed conditions by those who wish not to fulfil them? — I think there is always a diffi- culty about that; if a producer wished to be dis- honest he could falsify to some extent these figures ; but I think the checks we put upon them are a sufficient deterrent, and we have not left open obvious methods of loading the cost. That is what I was trying to explain to the Chairman. 1796. Yes, but the point has been put, and I feci that it requires emphasis, that you might have a fairly substantial expenditure on a film and it might nevertheless be a bad film? — Quite, I admit that.. 1797. It seems to me there is much more to be said for some other kind of test if it should prove to be possible. Is it not true that the costs of film production are rising rapidly in all respects? — Yes. 1798. And, in so far as that is the case, is not there a public interest in doing all one can to prevent extravagant and unnecessary expenditure? Do we not, by emphasising these elements of cost to the exclusion of other elements, artistic, quality and taste and so on, rather encourage that tendency to be extravagant? — I think I have said that I per- sonally would prefer the quality test ; but if that is ruled out for reasons which may b.e quite good, this is the only substitute that we have been able to discover. And as for what you were saying about extravagance and so on, this £2 a foot is not an extravagant production at nil. I mean that is not asking people to. be extravagant in production; it really is the minimum for which you can make a worth-while film. 1799. But such a condition might operate in favour of the more stupid of two producers if one of the producers were well prepared in the sense that he had money available and the other had not money available. Do you not think it is highly likely that in the next few years men will be coming into this business impelled to do so by their fooling that the films ought to be improved, and they will bring to the improvement of the film not necessarily money but perhaps brains and initiative? — Quite. 1800. Is not if vital in the interests of the improve- ment of British production to encourage that type of man? — Entirely; that was what I was rather dealing with in the remarks I made to the Chairman earlier on with regard to the exception which w<> have pul in here lor 1 he man who is able in produce a good English film but at lower eosi than we are putting it down at. That [ have always admitted. 1801. (Mr. t\n i, ron) i We had a specific suggestion put to us by the Film Producers Group, first of all that the quota should be a proportion not of the total footage of films hut of the footage of foreign films imported, which meant that the only people who would have to produce films for renters' quota would be firms desiring to import foreign films. They then went on to say that any film made under con- ditions to rank as British for that purpose which is over a certain figure should have no label attached to it, and should be eligible for renters' and for exhibitors' quota; that films within a certain range below that and above a certain minimum should be quota pictures, because ex hypothesi they would have been made by the people desiring to import foreign films, and should be labelled : This is a film made by so and so to fulfil quota requirements — that films below that amount, not being eligible for renters quota and therefore ex hypothesi made by British firms, should be eligible for exhibitors quota ; so that any exhibitor if he liked to take and show a film however cheaply made by a young English producer could show it, and it would count for his quota but not for renters' quota. I should like to know what you think of their scheme? — I have tried to understand to the best of my ability the evidence given by the five gentlemen who spoke from the Federation of British Industries, but, as they some- times mutually contradicted one another, it was a little difficult for me. I see some objection to the idea of labelling a film which comes below a certain standard of cost. I take it that they are accepting the Advisory Committee's suggestion that there should be some standard footage costs, and then if the film which is produced for a foreign film renter comes below that it has to bear a label which says: This is a rotten film, or something like that : it has merely been made for renters' purposes ; that is what it comes to. It is here: " This picture is a Renters' Quota Film acquired by Messrs. to enable them to distribute foreign films ". Well. I think that would go further to discredit British pictures; I think that is the very thing that we have all been striving to avoid. I do not think it would be such a deterrent to the renter. When it was shown it would say : Well, this is a very rotten film; it is a British film, but it is a very rotten one and we label it as such. I should hesitate to do that. 1802. I quite see that. You prefer the recom- mendation of the Board of Trade Committee, to the suggestion that such films should be eligible for exhibitors' quota? I was not quite clear on that point? — I must say I was a little confused about the question : this is a film which has been made but which does not quite comply with all our require- ments under the recommendation which we have made ? 1803. Yes? — Yes, we think that should be put in a neutral category — not count for or against quota ; it is still a British film, but it has not complied with our requirements. If you do not do that, if you give it exhibitors' quota, then all the work that you have done beforehand really is nullified. Renters' quota is not everything by any means. 1804. I quite see that point. If in order to increase quality you had to reduce quantity and lower the quota percentage, you would still keep that ratio, would you, 20 and 15? — iWell, I think it is a very good ratio. 1 mean I would not like to be bound by that, but 1 want to emphasise again that I think quality of British films is more important than quan- tity; and, as to employment, if you get the quality up you will give the requisite employment. You do not necessarily give more employment by producing a lot of rubbish. 1805. If you have your fairly high cost basis on the lines of your recommendation, thereby increasing quality and reducing quantity, and if you leave it to the discretion of the President of the Hoard of Trade to van the quota percentage from year to year, you would presumably, would you not. also have to Leave it to the Presidenl to vary the cost basis? — Yes; certainly there would have to be seine MINUTES OF EVIDENCE 165 14 July, 1936.] Mr. G. R. Hall Caine. [Continued. discretion in that, because obviously these costs, while being based to-day upon to-day's values, might in 10 years or five years' time have changed entirely , and a film which might be a very good film if things got cheaper costing 30s. would fulfil the same pur- pose as one to-day which we value at £2 a foot. 1806. And it might also be possible later on with- out unduly straining the resources of British studios to go to a higher cost? — Yes. 1807. There would be two sliding scales? — Yes. 1808. There is the difficulty which Mr. Metcalfe was putting in his minority report of the independent exhibitor? — Yes. 1809. There is the avowed policy of the K.R.S. not to allow independent exhibitors to combine for the purpose of renting films? — Yes, I know. 1810. That is not a point dealt with in your re- port. Do you think it is a point with which we ought to try and deal? — In what way? 1811. It is not a very easy thing to deal with, but I suppose it would be possible to introduce a clause preventing the K.R.S. from, in effect, obstructing groups of independent producers desiring to combine for renting purposes ? — Yes ; I am not in favour of that K.R.S. policy at all; I never have been. 1812. But do you think we ought to try to do something to alter it? — Yes; I think it does not help the industry. I am not in favour of that at all. 1813. Have you any suggestion to make? — Not at the moment, no. 1814. You agree, I take it, that there will always be a group of smaller British producers making serious films, but doing them cheaply, perhaps taking subjects that are of special value for showing in this country? — Yes, I hope there always will be, and that is what we want to encourage. 1815. But at the same time I take it you would agree that the main progress of British films de- pends on their commanding a sufficiently wide market to justify expenditure in some way com- parable with the expenditure of the big American corporations ? — Yes, undoubtedly. 1816. And that to that extent some linking up with American distribution might help British? — Yes ; I am not opposed to the linking up of British and American interests together as long as the essential quality of British films stands out. 1817. Provided it is an equal partnership, so to speak, and not a tutelage? You envisage the smaller British renter and producer being a perma- nent feature ? — Yes, and he ought to be encouraged to-day. If it is a recommendation which your Committee are making, I hope you will encourage him, because he is the foundation of the future of the industry. 1818. Do you see a danger, if you have too much protection for him, of a group of mushroom com- panies springing up which have not got the brains or resources either of intellect or of capital or technically to produce good films, bringing further discredit on the industry by turning out trash? — No; once you get over this quickie thing, which in my opinion has been one of the most serious detriments, then I think a number of companies will come along with genuine people who are genuinely trying to produce films of specialised value. Of course, they usually do what they term films of a specialised character. I think that will be to the good of the industry. In my humble opinion those people will not attempt to compete with concerns like Gaumont-British ; it is impossible for them to do so ; but, on the other hand, they can fulfil a very useful purpose in producing a type of film which perhaps Gaumont-British or British International would never think of doing and which is most necessary. 1819. I agree. I was only wondering whether there is a danger, as has been suggested to us in some evidence, that if their number increases too rapidly you may get a new breed of home-made quickies?— Well, I have not envisaged that danger yet. 37873 1820. (The Hon. Eleanor Plumer): Continuing a point which -Mr. Cameron made about the K.R.S. booking policy, the only suggestion we have had for dealing with that evil is one which might involve, and probably would involve, the legalisation of advance and blind booking. Now you think that a greater evil than the one it is designed to cure? — Well, I am a very great opponent of this advance and blind booking; but, as J said before, 1 realise that it is something which is really within the control of the exhibitor himself; if he does not want to advance- or blind-book, he need not do so; there is no compulsion on him to do it ; he can protect him- self like every other business man tries to do in this world and usually succeeds in doing. If he were an ordinary normal being, he would say : No, I am not going to book in advance, a year in advance and so on. But unfortunately the cinematograph exhibitor seems to be of a different kind altogether; he is a race of his own ; and apparently he needs some form of legal protection in order to prevent him from doing something which it is obvious to everybody on this Committee should not be done. 1821. In paragraph 17 your Committee recom- mends the repeal of the Section which lays down that the author of the scenario must be a British subject. There has been a good deal of evidence in support of that suggestion. Do you think it is generally agreed ? — Well, I am in rather a difficult position in the matter, because it was my clause that was brought into the House of Commons in Committee ; I suggested the amendment and the President of the Board of Trade accepted it. The reason why I did it at that time was this, that it was no use having a British film if the scenario was going to be so dis- torted from British ideas that the whole purpose of producing it was defeated. Ln other words, I can give you an example of a book which is to be turned into a film and handed over to an American scenario .writer, and he will change everything in it ; he will alter the setting and the character; he will keep the same theme but he will alter it so that you would never be able to tell it was a British film at all. The only man who can stop that is the scenario writer, and we thought that if we had a scenario writer with British mentality and British ideas we might hope to get an example of a British film. But there have been obvious difficulties. There are not sufficient British scenario writers and time apparently has not given us very many more. It has had a certain handicapping effect upon certain of the British pro- ducers. I think now ,we have reached a moment of time when the danger is not so great as in the early days, and, as I proposed the thing, I am satisfied. 1 sl»l>. You are satisfied now? — Yes. 1823. In spite of the possibility of the whole atmosphere being changed by a foreign scenario- writer ? — Yes. 1824. In paragraph 26 you deal with try-out ex- hibitions of films before trade shows. Again we have had a good deal of evidence with regard to that, that that might be altered. Do you suggest any limit to the duration or the number of such try- outs? — No, I do not think so. I think this try-out is a trade method, as long as it is not advertised and that sort of thing and as long as it is simply clone for the purpose of getting what you might call a dress rehearsal of the film. 1825. You do net think it necessary io salo-jiard it in any way? — Well, it is exhibited on one occasion and without any advertisement; I do not think that would be abused. I do not see that there is any opportunity of abusing it if it is, as I say, like a dress rehearsal. 1826. At the end of Mr. Metcalfe's report it is sug- gested that the scope of the Act should be extended by a scheme of compulsory arbitration. Could you tell us what class of dispute he had in mind? — This has been a hobby of .Mr. Metcalfe, for some years, this question of compulsory arbitration. I do not quite know what he had in mind there. I know he has raised it. F 3 166 COMMITTEE ON CINEMATOGRAPH FILMS 14 July, 1936. j Mr. 6. R. Hall C.une. [Continued. 1827. I do not quite understand Mr. Baker's pro- posal. Would you explain it? — You mean the italicised part? 1828. Yes?— Well, that is very much what Mr. Holmes was saying just now : first of all that the quota should be based upon foreign footage only, and, secondly, that a quality test should be imposed upon any quota films produced for renters for the purpose of fulfilling quota against foreign footage. He suggests a quality test there. 1829. It is rather puzzling? — Yes, I think it is; because a quality test is one thing and a price test is another. Perhaps Mr. Baker, as most of us think, thinks that if you put a footage price of a sufficient size on it will in itself tend to raise the quality of the film. That is all I can think he means. 1830. (Lt.-Col. Sir Arnold Wilson) : I apologise for my enforced absence, which may make it necessary for me to ask questions which have already been dealt with. I am in the position of being asked to criticize in one capacity what I have already un- reservedly endorsed in another. You will observe my signature as Chairman to a report the conclud- ing phrases of which may appear to pre-judge the work of this Committee. And I am further em- barrassed by the fact that I am a colleague, of the witness not only in the House of Commons but on the Advisory Committee, and he has served on that Advisory Committee considerably longer than I have. The report which is now before us is the outcome of a great deal of thought and research and considera- tion on his part and on the part of his sub-Com- mittee as a whole, and should carry great weight. Mr. Hall Caine has noted his objections to label- ling films as quota films, on the ground that it would tend to prejudice films so exhibited. 1 should like to ask him whether he has any alternative suggestion as to distinguishing between various categories of films by some anodyne unobjectionable word which would serve the purposes of Government without in fact raising prejudice, or would he prefer to have simply no label at all? — Well, I have never given that matter thought. I certainly would prefer to have no label at all, because whatever label you put on would tend to identify itself with something which might be thought to be distinguishing and therefore to some extent objectionable. If you could leave it without any label it would be better. Really any name would do ; if it falls under a bad category it would always tend to. 1831. And would you regard the present and im- pending financial rearrangements within the industry as making the labels even less valuable? — Yes. 1832. You have given your reasons why you think the proposals to prevent evasion which are laid down in paragraph 6 would in practice work fairly well. Have you any reason to think that the American film companies have succeeded in getting round the Chancellor of the Exchequer in relation to income tax? — No; I have got my own ideas on the subject but I have never gone very carefully into that side of it ; but I do want to say that before you came in I did tell the Chairman, as you will see in the evidence, that my Committee did not consider this suggestion for a statutory declaration a.s by any means a final suggestion or as any other than another deterrent against abuse. 1833. But as a matter of fact, the arts of counter- ing avoidance and evasion have been so highly de- veloped in other directions, at the Treasury, in tin' Hoard of Inland Revenue and elsewhere, that it should not be impossible for the Board of Trade to learn from the experience of other Departments and administer a carefully drafted scheme of this sort? — 1 do not think it would. I moan, after all. take income tax for instance: you know your return I'm' income tax: you either make an honest return or a. dishonest one: and. after all. there is roalK i cry little moans of finding out whether that is the entire income you derive except from ex- traneous sources. It is the same way here; I think you have to find it in that way. Nobody is going to the Treasury and turn evidence again-t himself and say: " I made a false return of income tax."' 1834. Have you in your business capacity been impri sscd by the ability of the Treasury to detect any involuntary omission on your part? — I think we all have. 1835. So you hold by your general scheme as being adequate? — I think it is the best that we can suggest to protect the industry against itself. 1836. I gather from your answer to Mr. Cameron that you were not opposed to a quality test? — No. 1837. Can you elaborate further your ideas as to how a quality test could be superimposed upon the cost qualification? — Well, before you came in, Sir. I had said to the Chairman that I thought the whole of the Acts dealing with the cinematograph industry should be brought under one control which should include the British Board of Film Censors. I think it is quite ludicrous that we should have a voluntary organisation censoring its own work. All these things should be brought in, and then if you do that. if you put it up for ethics and morals, it is quite easy also to judge for quality. 1838. With regard to the scenario writer, I prefer on the whole, to be wrong with you in 1927 than to be right with you to-day, in the belief that it is important that the scenario writer should be a British subject, and not merely a British subject hut have qualifications other than those which are imposed by the naturalisation laws of this country. There is no country in the world in which it is so easy to become naturalised as this country. I do not think being a British subject is by any means necessarily a qualification ? — No. 1839. I know many British subjects whose men- tality is further removed from that which I would wish to be typical of a British subject than the mentality of many foreigners? — You mean that the qualification should be British born, but even then that would not do. 1840. I feel that if we had an independent hoard there might be, quite unofficially, a general tendency by companies to select scenario writers with greater care. We do want to maintain the ideal of a scenario- writer whose work will represent the spirit that we wish to maintain in this country, and not those rather woolly misrepresentations of classical authors, which have to my mind spoiled so many potentially good films. 1841. (Mr. Stanley Holmes): May I intervene? If we had a quality test for all films, that could include historical and geographical accuracy? — Yes. 1842. (Lt.-Col. Sir Arnold Wilson) : I agree. — (Mr. Hull Caine): May 1 answer Sir Arnold on the point which led me to take the modified view that I have taken. I entirely agree with what he has said. I so expressed myself in the Committee stage of the House and was successful in getting my amendment through. It was for the reason that 1 wanted to ensure that when a British film went out to the Dominions and foreign countries it would actually show- our mentality and express the British spirit. The foreign producer was able to circumvent the clause: he did not call the man a scenario writer. He wrote the scenario, which, as you know, i- the short draft of the long story: then he brought in a man whom he called a continuity writer; he broughl in another fellow whom he called something else. And SO we found that, though they were strictly complying with the law in that they had engaged Mr. So and So, who may have been British horn and British bred and everything else, to write the scenario, they then handed it afterwards to another man who was an American, and he re-adapted it and made it entirely different. We had no power sec that the scenario when written was transcribed into the actual film. 1843. It has been suggested that n might he possible to organise a school >>r institute of technical training, which would make it easier to produce MINUTES OF EVIDENCE 167 14 July, 1936.] Mr. G. R. Hall Caine. [Continued. British writers; and that one of the things that the cinema industry lacks in this country — and it is almost unique in that respect — is any single institute where the art and technique of the film industry, which is a many-sided subject, is taught. Have you any observations on that? — Well, of course, anything that could be done on that line would he to the benefit of the British film industry as a whole. As a business man I am a believer in the hard school of practical experience, going through the actual studios of the big companies and learning the work rather in that way than academically. I do not know whether you could ever satisfactorily educate people to be scenario writers. I know you cannot educate people to become writers, because I had a father who was a writer and he was never able to educate me into becoming one. I do not know whether you could take a number of people who can express themselves well but do not know how to dc it in a way which would benefit the film and bring them into touch with what is wanted. That is what I think you meanp 1844. Yes. You are aware that there are in America a number of institutes which are purely technical institutes relating to the film industry, which have heen founded and subsidised by the in- dustry?— In short, I think that once you have formed your board or your central organisation, you will give the British film industry a standing which I think it deserves now, and which will all tend to development on the very lines of thought winch you are now bringing forward. How it will come it is impossible to say, hut it will elevate the industry and put it into a position which I hope it will attain, that is to say, make it respect itself. For years it had no self-respect at all, and a part of the trouble which you are endeavouring to clear up and which 1 for eight years have -been endeavouring to clear up has been due to the fact that there has been a type of man in the industry who has had no respect for himself, and has not realised that he is part of a big business and a big organisation, which he is. If you can get him to respect himself, you will not have half the trouble which you have in this matter. 1845. In fact, the B.B.C. in this respect has lessons for us? — Yes. 1846. (Chairman) : I am very much indebted to you, Mr. Hall Caine. (The Witness withdrew.) MEMORANDA OF EVIDENCE FURNISHED TO THE COMMITTEE ON WHICH NO ORAL EXAMINATION TOOK PLACE. (a) Further Memoranda by the Cinematograph Exhibitors' Ireland. Association of Great Britain and (i) A " Quality " Committee. If a committee he constituted upon the lines which we have suggested we do not think that it would be necessary for it to review all British films. We beg to suggest the following mode of procedure : — ■ When a film was trade shown it should be com- petent for this Association (or, if preferred, a given number of exhibitors — say five) to ask, within three days, for a re-viewing of the film. If the film failed to satisfy the " Quality Committee " the registra- tion should be cancelled and the film would there- upon fall into a neuter class. It would be unfair that because a film was disallowed from registration as a British film that it should automatically be deemed to be a foreign film and, therefore, re- registration should be unnecessary. Once two or three decisions had been given by the Quality Com- mittee we do not anticipate that it would be required to do much work, as the first decisions would quickly eliminate the " quickies " as the producers would know that they would not have any chance of being passed by the committee and, therefore, they would not be made. The committee would seek to establish as a standard that the films passed represented a bona fide attempt to produce a film possessing enter- tainment and exhibition merit which would enable the renter to rent that film in a free market in competition with foreign films generally acceptable to the public. We do not think that it is necessary to have a large committee. We suggest that it should be five in number — a producer, a renter, two exhibitors and an independent chairman in whom the public 87873 would have confidence. We do not anticipate that the Association would find any difficulty in obtaining the services of two exhibitors to act in a voluntary capacity, and anticipate that similar public service in the interests of British production would be forth- coming from other sections of the cinematograph trade. The remuneration of the independent chair- man is a matter which we have left to the con- sideration of the committee, if such a course was found necessary. 9th July, 19.36. (ii) Sub-standard films. There are a number of halls showing per- formances of sub-standard film regularly and charging for admission. Some of our members have been endeavouring to secure village halls, etc., where cinematograph performances could be given regularly on sub-standard films. There is a difference of opinion amongst Licensing Authorities to-day on what constitutes an inflammable film as expressed in the definition clause of the expression " theatre." All films are inflammable, but some Licensing Authorities do not bother themselves to enforce any provisions of this kind in respecl of non-flam film, which is more accurately described as slow burning. The above performances are generally of an entertainment character and a charge for admission is made. The other type of performance is a mixture oi advertising and entertainment films. One of the apparatus manufacturers fixes up with a national advertiser that he will show in the various working F4 168 COMMITTEE ON CINEMATOGRAPH FILMS 14 July, 1936.] I ( 'on t inued. men's clubs, etc., a programme including the par- ticular advertising film which is the main object of the performance. It would not be any trouble to include British quota in such programmes, and as the clubs, etc., concerned are anxious to show as many of this type of programme as possible, it would be useful if they were licensed so that you could keep track of them. Bona fide educational exhibits would not be affected, as the films in use would come within the excep- tions specified in Section 27. On the entertainment side, sub-standard films are reduced by the renter from standard stock so that very little complication would ensue in regard to any question of registration. 31st July, 1936. (h) Memorandum by Mb. Stuart F. Doyle. Statement by Stuart Frank Doyle, Managing Director of British Empire Films Limited, Distribu- tors of British Pictures in Australia, principally British International Pictures, Associated Talking Pictures, Capitol Productions, Herbert Wilcox Pro- ductions, General Film Distributors Productions, with Offices at Dorland House, 14, Regent Street, London, S.W.I, the Head Office of the Company being at Film House, 251a, Pitt Street, Sydney, Australia, and with Branches in Melbourne, Adelaide, Perth, Brisbane, Hobart and Wellington (New Zealand). Also Managing Director of Cine- sound Productions Limited, being the largest Pro- ducers of Film in Australia, with their Principal Studios at Ebley Street, Waverley, Sydney, and Head Office at 49, Market Street, Sydney, Australia, and with London Offices at Dorland House, 14, Regent Street, London, S.W.I. I am making this statement on behalf of British Empire Films Limited, and Cinesound Productions Limited, both Companies being vitally interested in the future of the Cinematograph Films Act. My Company, Cinesound Productions Limited, m common with other producers in Australia, are alarmed at recommendations that have been made before your Committee, that Australian pictures made within the Empire should not be eligible under any future Quota Act. Should this be accepted by your Committee and become Law, it would spell the death knell of Australian production, because Australia cannot supply sufficient revenue to enable pictures to be successfully manufactured there without the benefit of the English market, and the disqualification of Australian film from the benefit of quota, particularly from the exhibitors' quota, would put a handicap on Australian films and make them impossible to produce. Up to date no Australian picture is able to earn anything on the foreign market, and is dependent entirely upon Australia, New Zealand and England, for its earning capacity. I would favour either a qualifying Committee to deal with production, or a qualifying cost of pro- duction from the point of view of Australian pictures. Of the two methods we would favour the qualifica- tion of cost rather than that of quality, as Australian stories might be misunderstood by the Committee set up to judge. I might mention that in the Quota Act of New South Wales and Victoria, a Qualifying Committee has been set up, but the Act has not been in existence long enough to ascertain whether the activities of this Committee are satisfactory. In any case, there is no representative of the trade on the ( Miumittee, and it can be considered a layman's Committee in its control. From the point of view of the distribution of British film in Australia, in my opinion it is highly desirable to have some qualifying machinery to improve the standard of British film. The majority of the pictures that are released in Australia are those that are manufactured by purely British organisations. Any system that will eliminate the cheap indifferent British picture and bring about a higher standard of British production, will be welcomed by the distributors of British film in Australia. Nowhere else in the World, even in England itself, has such an effort been made as in Australia to develop public interest in British film. Special circuits of theatres have been created for the presen- tation of British film alone, and the public have been educated to becoming all-British film minded, and as a matter of fact, a distinct public has been developed who follow British film. However, it is found that it only needs a number of indifferent British films to be presented in these all-Brit i>h theatres when the public, notwithstanding their patriotic outlook, lose interest in the entertainment, and it is a very difficult task to re-capture their interest and re-build these theatres back to a pro- fitable basil. The public, ever critical, and expecting British films to develop at the same speed as the technique of American films, are naturally critical of the poor and indifferent British film that comes on the market from time to time. If, in the passing of the new British Quota Art. a qualifying clause is introduced, either by way of cost or quality, it will be welcomed by the Australian distributor of British film, and the Australian exhibitor. The Australian exhibitor welcomes good British film, but desires that a better class of picture be concentrated upon and the weaker pictures kept out of Australia altogether if they must be produced. As an alternative to any qualifying clause in relationship to Australian pictures, it is suggested that a voluntary or public organisation should be created to prevent indifferent British film being exported out of the country, just as is frequently done in relationship to manufactured goods and produce in other countries, so that only the best of British film is presented outside England itself. This would have the effect of keeping away from any country, particularly within the Empire, films of mediocre character which does much to lower the prestige of British film production, and indeed of England itself. London, 2nd July, 1036. MINUTES OF EVIDENCE 169 14 July, 1936.] [ ( itiit'inued. (c) Memorandum by the Electrical Trades' Union. We have had the privilege of reading a copy of the evidence submitted to you by the Trades Union Congress General Council, with which we entirely agree. As a trade union having over 1,000 members em- ployed as electrical craftsmen in the production of films in this country we wish to add that the condi- tions of employment generally observed by the pro- ducers are of a satisfactory nature and in nearly all cases governed by mutual agreement between proprietors of the studios and the trade unions con- cerned; that in our opinion the competition from America, unless restricted, will eventuate in a re- duction of employment to our members; that the electrical accessories and the technical skill of our members is, in our judgment, equal to that of any other country and that given reasonable protection against " dumping " the class of production in this country will be fully equal to that of any of the competing nations. Fully realising that the only danger to increased production in this country is the " dumping " here of surplus foreign films, we fully endorse the application for the continuation in the proposed amended form of the Cinematograph Film- Act of 1927. 16th July, 1936. ( Memorandum by the Theatrical Artists' Filji Society. The Committee of the Theatrical Artists' Film Society is in favour of maintaining the quota film if proper safeguards are provided to improve the quality and make it worthy of being a British film. At the present time it is a common practice for foreign waiters and other aliens, gathered from the foreign quarter of Soho and other districts, to be employed for parts and as extras. To make matters worse these people are not, and never have been, artists and this seriously affects the artistic value of British quota films. To prevent this happening in future the Committee suggests it be laid down in the regulations that only artists, who are members of one of the professional organizations devoted to the entertainment industry, be employed. In the interests of art, and where the story re- quired that a foreign artist should be engaged for a principal part, the Committee would not raise any objections, but it is strenuously opposed to the whole- sale engagement of foreigners in British quota films. The Committee urges that steps be taken so that the minimum rate of pay, for small parts and extras, be that laid down in the agreements entered into between the studios and the aforementioned artists' organizations. The Committee also urges that the regulations in future demand that all artists must fill in and sign the printed form declaring their nationality before engagement and not after the production at the studio. The latter is the usual practice at present. 13th June. 1936. \li) Memorandum by thf. Trades Union Congress. Introduction . The Trades Union Congress General Council is the representative central body of the British Trade Union movement. The unions and societies affiliated to the Trades Union Congress include within their membership workers in all branches of industrial and commercial activity. This memorandum has been drawn up by the General Council of the Trades Union Congress after full and careful consideration of the present position of the British film industry and of the Quota provi- sions of the Cinematograph Films Act of 1927. and after consultation with those unions affiliated to Congress who are directly interested in the British film industry. The observations made and the pro- posals put forward in this memorandum are those of the Trades Union Congress General Council. They are concerned with, and are submitted in the light of, wide considerations of social significance. General Observations. 1. A film industry, particularly production and distribution, occupies a unique position. Wireless broadcasting alone approaches it. It is distinguished from industrial and commercial activity generally by reason of the influence it possesses in affecting the general level of education and culture — in act- ing as an advertiser and a propagandist, at home and abroad, of particular products, ideas and stan- dards of conduct. 2. Of the possession of this influence by the film industry there is ample evidence in the post-War experience of films in this country. The one-time almost completely ail-American character of cine- matographic performances and the existing pre- ponderance of American films shown in this country has had the effect of familiarising and popularising American products, American speech, customs, social arrangements and ideas amongst British cinema audiences. Americans themselves are con- vinced that the film is a powerful influence in in- creasing the sales of American products in other countries. The influence of American films upon speech and dress in this country is so obvious as to have passed the stage of general comment. Equally, it can hardly be doubted that many people in Britain base their judgments of the United States and its people upon tile impression- tlie\ derive from visits 172 COMMITTEE ON CINEMATOGRAPH FILMS 1 ! July, 1936.] [Contvn \ii d. to the cinema. There have been comments from abroad on the effect of showing highly-sophisticated western films to eastern audiences. 3. On the general ground of the desirability of maintaining and extending industrial and com- mercial activity within this country, the General Council of the Trades Union Congress are anxious to see the production of British films soundly estab- lished and progressively developed. Though the amount of employment that is and can directly be given by film production is not to be compared to the amount of employment that is given by the basic industries of this country, it can nevertheless provide direct employment for a substantial number of British workpeople and that, judging from current experience, under reasonably decent con- ditions and at reasonably good wages. The in- direct employment and industrial value of a well- established and progressively developing British film producing industry is indeterminate but considerable. 4. It is, however, because of the possession by a film industry, particularly film production and distri- bution, of a unique power to influence the customs, habits and ideas — all that may be described broadly as the level of cultural and educational attainment — of cinema audiences and the power to sustain, ex- tend or diminish the prestige and the sale of the products of a country in other lands, that the Trades Union Congress General Council desires to have an intelligently conducted British film producing in- dustry maintained and developed. The Trades Union Congress General Council believe that the proposals put forward in this memorandum will assist in the attainment of that object. 5. The Trades Union Congress General Council do not wish that the attainment of that object shall be made the excuse for the production of poor quality films or for the propping-up of an inefficient industry. They have given the most careful con- sideration to this matter and they are convinced that for several reasons British film production can- not hope to be maintained and developed on quality and merit alone. The prevalence of practices whereby the exhibitor is more or less firmly controlled by the distributing agent — the renter — who, in turn. in Great Britain, is often little more than the agent of a foreign producer, makes it difficult to secure bookings for films, other than the undoubted " hits ", not produced by producers in control of or in close association with the renters. The business of distributing or renting is largely under American control or influence partly by reason of the oppor- tunities open to American producers during the War when production in England was suspended, and partly by reason of the fact that the American pro- ducer, having by his control of distribution in America practically closed the American market to British producers, is enabled to recover his costs in his own country and supply an expensively produced film at a low figure for distribution here. Under such handicaps the British producer's difficulty in securing a satisfactory distribution and exhibition of his films is not one that merit alone will help him to resolve. 6. The quality of British films, once low, has im- proved considerably and rapidly during the past several years and it is suggested that the proposals of this memorandum will assist in the maintenance of that rate of improvement. The Quota Provisions of the present Act. 7. The Trades Union Congress General Council be- lieves that, on the whole, the Quota Provisions of the 1927 Act have worked for the benefit of the British film industry. Certainly, during the period of the operation of the Act, British film production and capacity to produce has increased and the quality of British films has shown considerable im- provement. Quite early, however, in the operation of the Act it became apparent thai means had been found of evading the fulfilment of the intention of the Act though not of its provisions. The method of evasion is for Renters who desire mainly to distribute foreign films, to make or to have made for them in the British Empire, films at a very low cost and usually of very poor quality simply in order that they may fulfil the legal Quota requirements necessary to enable them to distribute foreign films. This practice is acceptable to the Renter of foreign films since it serves both to enable him to fulfil his Quota requirements at little cost and does not pro- vide any real competition with the products he is most desirous of distributing. In fact, the practice tends to show up British films in general in a poor light in contrast with the comparatively excellent foreign product. The existence of this practice is not disputed and the effect has undoubtedly been to create an entirely unwarranted prejudice against British films in general. The Trades Union Congress General Council strongly urge the need to eliminate this type of cheap Quota film, and the proposals of this memorandum for a minimum cost requirement for films eligible for Quota are submitted for that purpose. 8. The Act of 1927 distinguishes long films (films of three thousand feet and upwards) and short films (films of less than three thousand feet) and provides that Quota requirements shall be satisfied in respect of long films as well as in respect of all films. Thus, under the present Act, Renters and Exhibitors must acquire and exhibit respectively a proportion of long British films, if long films are acquired and ex- hibited at all, but there is no compulsion upon Renters and Exhibitors to acquire and exhibit short British films. . 9. In considering the effect upon short film pro- duction of the omission from the present Act of any compulsion upon Renters and Exhibitors respectively to acquire and to exhibit short British films, the Trades Union Congress General Council have been concerned with the probable effect of the inclusion of such a provision rather than with the known effects of its omission. 10. It is, however, known that the difficulties of finding a market for " short " British films have been increased by the development during recent years of the " two feature programme " in cinema theatres and that the present Quota provisions are less favourable to the exhibition of short films than to the exhibition of long films. 11. Certain types of short British films have always been in an exceptionally unfavourable position in re- lation to films generally. Films of quite exceptional merit and of high social, educational and cultural value are almost exclusively of the " short " variety and are often produced by small groups of persons possessing a limited amount of capital and whose influence with Renters and Exhibitors is negligible in comparison with larger producers. Because of these limitations and because their products are often less obviously likely to be to the taste of the unimagina- tive sections of film audiences, such producers are at an even greater disadvantage in finding a market for these products than are British producers generally. The Importance of Short Film Production. 12. Yet the need to encourage the production and exhibition of short British films of exceptional merit and of high social, educational and cultural value is as great if not greater than the need to maintain and develop an intelligently conducted film-producing industry. It is in the production of short " Docu- mentary", "special subject" or "special treat- ment" type of film that the industrj as a whole finds the material — the men and the ideas — with the use of which the quality and the presentation of film plays is improved. 13. The General Council of the Trade- Union Con- gress is convinced that if legal provision can be made with the object of encouraging persons possessed of MINUTES OF EVIDENCE 173 14 July, 1936.] [Continued. original ideas but of little capital and less influence with the distributing section of the industry, to undertake film production, the prospects of continued improvement and extension of British film production will be increased. The certain future development of television broadcasts in this country is another reason why intelligent experimentation in film pro- duction should be encouraged. Proposals in detail of the General Council of the Trades Union Congress. 14. The following paragraphs set out in detail the proposals which the Trades Union Congress General Council wish to submit to the consideration of the Departmental Committee. 15. The object of these proposals is to ensure the maintenance and development of a strong and intelligently conducted British film producing industry and to assist progressively to improve the quality and to extend the influence of British films. Proposal 1. — That the Quota principle of the present Act be retained in any future Act but applied as a percentage of foreign films acquired and exhibited instead of a percentage of all films as at present, and that in any future Act the percentage of British films required to be acquired and exhibited by Renters and exhibitors respectively shall be as follows : — Renters' Quota : Proposed new Quota (being the percentage of British film to be acquired based upon the total of foreign film acquired). In the 1st year of any future Act, 29 per cent. In the 2nd year of any future Act, 33 per cent. In the 3rd year of any future Act, 38 per cent. In the 4th year of any future Act, 43 per cent. In the 5th year of any future Act, 48 per cent. In the 6th and subsequent year of any future Act, 54 per cent. Exhibitors'1 Quota: (To commence not earlier than six and not later than 9 months after the date of the commencement of Renters' Quota.) Proposed new Quota (being the percentage of British films to be shown based upon the total of foreign films shown). In the 1st year of any future Act, 25 per cent. In the 2nd year of any future Act, 29 per cent. In the 3rd year of any future Act, 33 per cent. In the 4th year of any future Act, 38 per cent. In the 5th year of any future Act, 43 per cent. In the 6th and subsequent year of any future Act, 50 per cent. Proposal 2. — The inclusion in any future Act of provisions to ensure that if films acquired and exhibited by Renters and Exhibitors respectively include both long films and short films the Quota requirements of such Act shall be satisfied as respects the short films so acquired and exhibited as well as respects all films so acquired and exhibited. Proposal 3. — (a) All films to be registered as at present in order to be eligible to serve as Renters' or Exhibitors' Quota. (b) Long Films (i.e. films over 3,000 feet in length). Subject to exceptions permitted by the reconstituted Advisory Committee herein pro- posed, no long film costing less to produce than 15s. per foot in respect of the items required to be returned on Board of Trade Form " C," subject to a maximum requirement of £5,(100 on Form " C " in respect of any one film, shall be eligible to serve as Renters' or Exhibitors' long Quota. (c) Short Films (i.e. films of 3,000 feet and !, Subject to the exceptions permitted by the re- constituted Advisory Committee herein proposed, no short film costing less to produce than 5s. per foot in respect of the items required to be returned on Board of Trade Form " C," subject to a maximum requirement of £1,500 on Form " C " in respect of any one film, shall be eligible to serve as Renters' or Exhibitors' short Quota. (d) The inclusion in any future Act of a pro- vision to enable the Advisory Committee to the Board of Trade, as reconstituted in accordance with Proposal 4 of this memorandum, to permit of the registration of " long " British films costing less to produce than 15s. per foot on Form " C " basis and of short British films costing less to produce than 5s. per foot on Form " C " basis, as films eligible to serve as Renters' and Exhibitors' Quota if, in the opinion of the Committee, they possess special features entitling them to be so registered. Proposal 4. — That the Advisory Committee to the Board of Trade shall be reconstituted and made more representative (including representation of the Trades Union Congress and the Federation of British Industries) and shall be given power to make recom- mendations to the Minister as well as to supervise the working of the Act generally. It should also make an annual report, which should be published, on the working of the Act and the position of the British film industry. (Nate 1. — The above proposal was submitted to the President of the Board of Trade by the T.U.C. and the F.B.I, jointly in 1932. The General Council of the T.U.C. are of the opinion that the proposal re- submitted is of even more importance now that proposals are put forward for a greater measure of favourable treatment for British film producers. The General Council believes that it is a wise principle to include in any proposal for special treatment of an industry a proposal for the exercise of supervisory and advisory powers in connection with it.) Proposal 5. — The inclusion in any future Act of Clauses permitting the employment of juveniles in studios for the purpose of portrayal in films. (Note 2. — Detailed proposals in this connection have already been submitted by the T.U.C. to the Home Office.) Proposal 6.— That Section 27 (3) (iii) of the Act of 1927 shall be deleted thus removing the restrict ion that scenario writers must be British in the case of British Quota Films. (Note 3. — This Clause in the present Act is an unnecessary hindrance to British producers and is hardly in the best interests of the industry.) 17th June, 1936. (i) Memorandum by Wing Commandeb W. E. Wynn, R.A.F. (retired) At no time during the past nine years has feeling in America been so favourable towards Britain as to-day. This change in sentiment, especially marked in California, is to some extent due to British films, which, to many Americans, have broughl England closer than anything else could possibly bave done, Thej have undoubtedly established a subtle though effectual bond between many American picturegoers and ourselves. British films can becoi still stronger pro-British influence in the United St 174 COMMITTEE ON CINEMATOGRAPH FILMS 14 July, 1936.] [Continued. provided their .wider distribution is encouraged and their character and tone worthily represent Great Britain. Rumours have, however, recently boon current that the British Government desires to end the present entente between Hollywood and British studios, with hints in the local Press that America should begin to think of measures of retaliation, to meet what is feared may be British discrimination against Holly- wood. It is certain that an abrupt and graceless break in relations now existing between the American and British branches of the motion picture industry would not only lead to retaliation, but to regrettable re- actions upon Anglo-American harmony in general. There can be no question of the need for a re- adjustment, as between American and British films, but discord and a sudden dislocation should as far as possible be avoided, despite the fact that at the present time nearly half the gross earnings of im- portant American productions are drawn from the British Empire, and thai British pictures are not yet a serious challenge to Hollywood's pre-eminence, in the United States or elsewhere. What is necessary to enable British films to play a larger part in the entertainment of the world, especially the English-speaking world? The answer lies primarily in the law of supply and demand. The demand is for good and ever- improving pictures. If British films can supply their share of that demand they will be sure to prosper. British studios should, therefore, consistently make films capable, on their own merits, of winning publi • preference, rather than seek the encouragement of mediocrity by protective legislation. The final arbiter of relative entertainment value is the ticket- buying public. The only way to win its favour, and its cash, is by giving it good pictures. What can British studios do, to improve the general quality of their product, more than they are already doing? A criticism often heard in Hollywood, for instance, is that British producers do not fully appreciate the importance of the story as an element in films. The Americans have no illusions on this point. They pay high salaries to writers ready to learn and adapt themselves to the requirements of the screen, and give them every chance to gain experience. British producers are alleged to rate the British writer very low. and. apart from foreigners and those whose name alone has advertising value, to make little effort to make the screen writing career an attractive one. More attention will have to be paid to story structure, and editing, in this country, before we can hope to compete with the Hollywood product, at least in America. Another thing that sometimes brings a smile to Hollywood li] is is the fact that many of our pictures represent Hollywood, rather than British, talent, in spite of having been produced in England. It is true that the British industry had much to learn from the U.S.; it still has. The Americans have been very ready to instruct us, though not entirely from altruistic motives. The increasing demand for film entertainment in the British Isles did not pass unnoticed by the Holly- wood producers, who, naturally enough, decided they would like the major share of the growing British market. They saw the futility of trying to stifle their sole potential competitor, and decided to assist in its development, thereby gaining a considerable measure of control over the British film industry. This has been done by making British producers depend mainly upon Hollywood for their supplj of talent, neglect the development of home resources and spare the Americans the prospect of a firmament of British stars competing .with their own. Actors who show promise are lured to the Pacific COast, hound by a contract, built up as only Hollywood builds up and thereafter only become available for British films on Hollywood's own terms. Anoth sr thing; the fact that distribution in America is almost entirely controlled by Hollywood gives it the whip hand over our producers who seek American outlets for their pictures. These are some of the reasons why so many of our films have a Hollywood complexion, and why producers favour foreign talent rather than British. Hollywood believes, not without some justification, that any unemployed actor, writer or director has only to come here immediately to find a job, pro- vided he is not a British subject. As an example of this, an American acquaintance of my own. tried and found wanting in America, had no trouble in securing work in England. His contract provided for a salary, very moderate for Hollywood, higher than that of every British writer on that studio's staff. Presumably he was entitled to a premium, for not having the misfortune to be British. There is in Hollywood quite a number of British, experienced in various branches of the motion picture business. Why are some of them not brought to England? Is it because of the prejudice of those producing pictures in this country against all but foreign talent? Is it true that a British subject's only chance of a job with a British studio is to change his nationality? Or is it because it is be- lieved that Americans will not go to see a film produced b3T British subjects and typically British? "Henry VIII " was essentially British in tone: so were " The Scarlet Pimpernel.'" " Sanders of the River," and " Thirty-nine Steps." all very popular in the United States. Jessie Matthews has a large following, in spite of being British. " Lives of a Bengal Lancer," though produced in America, successfully caught and faithfully present a British atmosphere and spirit (all a motion picture can hope to achieve, or that it need achieve). It was as great a success in the United States as elsewhere. The average American is by nature sympathetic, rather sentimental, intensely human, kindly to- wards the world at large and generally free of strong prejudice against foreigners. He likes pictures with a foreign setting, and to be shown how life is lived in countries other than his own, provided the atmosphere is presented with sincerity and truth. He is quick to sense artificiality, is tired of what in Hollywood is known as " Hollywood " and always welcomes something new. He has no objection to British ways and points of view. On the contrary, he takes a generous interest in Britain and the British Empire. It is a pity he cannot see more of us as we really are. rather than as Hollywood would have us. It is not intended to suggest that foreign talent should be barred by act of Parliament ; merely that British talent be developed in order to lessen our dependence upon Hollywood, and in order to build up a truly British motion picture industry. Legislation should aim at encouraging our pro- ducers to make pictures worthily representative of Britain, and of the standard of excellence that alone will give our industry a place in the sun. These re- quirements might be met somewhat as follow-. A special tax of, say. three shillings per foot, to be levied on every film, intended for release in the United Kingdom, whether produced in England or abroad. This tax. however, to be subject to appreci- able deductions. In order to encourage the employment of British subjects a deduction to lie made for. (a) The proportion of British personnel's emolu- ments to the total nay-roll borne by the picture on account of. producing staff, actors, directors, writers. art and sot dressing departments, musician-, camera men sound engineers, special effects department, cutters and editors. Maxi- mum deduction, if the above is 100 per cent. British, sixpence per foot of film. MINUTES OF EVIDENCE 175 14 July, 1936.] [Continued. In order to make producers aim at a high standard, deductions from the special tax also to be allowed for. (b) Entertainment value. To be determined by an unofficial panel of critics. Maximum, ten- pence per foot. (c) Educational and inspirational value. To be determined by the Board of Censorship. Maximum, eightpence per foot. (d) A special award, to be given for a film of exceptional excellence, on the recommendation of a majority on the panel of critics. Maximum deduction from the special tax under this head, fourpence per foot. With a view to encouraging their distribution abroad, and discouraging discrimination against British films. (c) A foreign picture to be granted deductions according to the proportion the total of British films' gross earnings, during the preceding year, in the country of origin of the foreign picture, bear to the total grosses of that country's pictures in the United Kingdom. For equality, tenpence. For a 50 per cent, balance in favour of British films, an additional deduction of four- pence. (/) For films made in England, a deduction of fourpence per foot. (a) British films that, during the previous year, had grossed as much abroad as they had at home would be entitled to a deduction of fourpence per foot. This to encourage efforts to extend the showing of British films abroad. 'The maximum total of deductions obtainable by a foreign film, with no British elements included in its making, would be as follows: — s. d. (b) 10 per foot of film. (c) 8 (d) 4 (e) 1 2 Total 3 0 The maximum total of deductions obtainable 1>\ British film would be as follows : — s. d. (a) 6 per foot of film (b) ... . 10 (c) ... . 8 (d) ... . 4 (/) ■■■ • 4 (g) - • 4 Total ... 3 0 Any film that had won deductions amounting to three shillings (or more) would be freed entirely of the special tax. Although the maximum deductions only have been shown under each head, it is to be understood graduated deductions would be provided for. To help in this, each penny might be divided into hundredths and the deductions assessed in these terms, e.g. Fivepence expressed as five-hundred, tenpence as a thousand, etc. 21st September, 1936. (j) Memorandum by Julian S. Huxley, John Grierson and Paul Rotha on a Further Method or Encouraging the Production and Showing of Short Films of Good Quality in the United Kingdom. The production of an adequate supply of short films can be catered for by arranging a separate quota for shorts. With this system alone, however, there is no provision for encouraging high quality in the shorts produced. At the moment, short films are under a disability for a variety of reasons. (1) A deficiency in the quota for shorts can now be met by substituting long films of equiva- lent footage. This, as mentioned, can be met by insisting upon separate quotas for shorts and longs. (2) There is virtually no premium on exhibi- tors showing a good short as against an in- different or even poor one. The same applies, mutatis mutandis, to the renting of shorts. (3) There is usually no means by which the public can know what shorts are being shown at any theatre, unless they actually ring up and inquire. Shorts are in general regarded as mere fillers, to fill up the programme; the price per foot paid for them iby exhibitors and Tenters is extremely low in comparison with that for good or even moderate long films; and the public has little or no opportunity of bringing their in- fluence to bear in favour of good-quality shorts, although it is clear that good films of document- ary, natural history, and travel interest are very popular. It is suggested that these disadvantages could be in large measure remedied if the advertisement of one short film were made compulsory in every adver- tisement of a long film. This would enable the public to know where a particular short film was being shown, and so would enable them to choose between two otherwise equally attractive long films on the basis of the superior attraction of a good short. It would bring shorts more prominently before the public, and lead to more appreciation of their interest and attractions. It would lead to greater numbers of cinema-goers writing to exhibitors to demand the showing of particular shorts. The precise method suggested is as follows: — That it should be compulsory, in all advertisements (in- cluding Press) to the public of cinema programmes, to insert a reasonahle advertisement, including the title, of one short film, this to be alternatively either (a) a British-produced short, other than a news reel or news magazine, or (b) any short, other than a news reel, news magazine, or animated cartoon, wherever such films are shown. The former alternative is more suitable if the primary aim is to encourage British production of shorts, the latter if it is to encourage high quality in documentary and allied types of shorts. There appear to be no technical difficulties in the way of such a regulation. In the case of large posters advertising long films, the provision oi a smaller poster for a short film would suffice, or the pasting across the large poster of a strip advertising a short. By this means, rapid progress in the quality of the shorts shown in British theatres and of those pro- duced in Great Britain, would bo achieved. 22nd August, 1936. 176 INDEX INDEX TO EVIDENCE [Note. — References in italics are to Questions in the Oral evidence ; other references are to Pages of the Written evidence] Ace Films, Ltd. : — memorandum of evidence, 147. oral evidence, 148. Administration, 113, 134, 157, 1228, 1238, 1458, 1500, 1773. Advance booking, 113, 153, 156, 159, 160, 1008, 1125, 1239, 1712, 1785. Advisory Committee, 127, 132, 134, 147, 154, 157, 173, 1111, 1458, 1484. Advisory Committee, Report to Board of Trade, 153, 1712. Blind booking, 113, 115, 153, 156, 159, 160, 1008, 1125, 1161, 1172, 1239, 1292, 1712, 1785. Block booking, 113, 115, 159, 160, 169, 1043, 1125, 1161, 1172, 1239, 1292, 1722, 1785. British film, statutory requirements, 147, 150, 153, 154, 156, 1180, 1196, 1669. Cinemas : — ■ independent, 1158, 1163. Cinematograph Exhibitors Association of Great Britain and Ireland : — supplementary memoranda of evidence, 167. Cinematograph Films Act, 1927 : — ■ excepted films. See Films, penalties, 153. quota provisions, 172. Denning Films, Ltd. : — memorandum of evidence, 146. oral evidence, 146. Documentary films, 132, 140, 170, 175, 1444, 1464, 1686. Doyle, Stuart F. :— memorandum of evidence, 168. Electrical Trades Union : — memorandum of evidence, 169. Employment in film production, 133, 148. 149, 169, 171, 1131, 1685, 1693. Exports, 112, 1150, 1298, 1355, 1506. Film industry : — ■ administration, 114, 1200, 1239. capital invested in production, 115, 1147, 1220. economic factors, 110. personnel, 96, 114, 133, 134, 1001, 1032, 1037, 1059 1069, 1180, 1200, 1239, 1245, 1529, 1666. stages in operation and under construction, 126. Films : — British : — advertisement, 127, 128, 175, 1323, 1331, 1388, 1516. cost, 113, 114, 127, 148, 154. 155, 156, 157, 158, 978, 1031, 1084, 1186, 1437, 1439, 1687. Empire films and the quota, 147, 150, 168, 1613, 1672. exhibited in quota years 1932-5, 125. footage screened, 125. quality, 96, 97, 127, 148, 150, 154, 156, 157, 175, 961, 987, 992, 999, 1015, 1030, 1037, 1042, 1056, 1059. 1078, 1090, 1179, 1296, 1306, 1620. qualitv test, 114, 128, 154, 155, 156, 157, 158, 167, 168," 169, 985, 1113, 1186, 1328, 1348, 1359, 1517, 1525, 1727, 1771, 1805, 1836. registered for exhibitors quota only, 157. short. 115, 127, 133, 155, 158, 172, 173, 175, 1003, 1038, 1210, 1274, 1336, 1355, 1425, 1666. supply, 96, 110, 940, 992, 1049, 1436, 1452. value of output, 115, 1313. foreign : — footage screened, 125. for speoiaJ theatres, 139, 1534, 1585. quality, 1 10, 175, 1022, 1045, 1296. Films — -ceroid. : — ■ foreign — contd. : — short, 115, 115,1210. supply, 96, 97, 110, 944, 1056, 1182. serial films and series of films, 158, 160. sub-standard, 167. taxation of, 174. to which Cinematograph Films Act, 1927, does not apply, 109, 127, 132, 147, 155, 171, 175, 1365. " try-out," 155, 1824. Film Society : — ■ memorandum of evidence, 139. oral evidence, 143. Finance, 115, 1139, 1232. Greene, J. Leslie : — memorandum of evidence, 169. Grierson, J. : — memoranda of evidence, 132, 175. oral evidence, 134. Incorporated Society of Authors, Playwrights and Com- posers : — memorandum of evidence, 169. Hall Caine, G. R., C.B.E., M.P. :— oral evidence, 153. Huxley, Julian S. : — memorandum of evidence, 175. Kinematograph Renters' Society of Great Britain and Ireland, Ltd. : — membership, 96. memoranda of evidence, 96. oral evidence, 98. Marketing, 1319. National Association of Theatrical Employees : — memorandum of evidence, 149. oral evidence, 150. Quota : — exhibitors', 150, 155, 156. 946, 990, 1016, 1205. proposals for amendment, 96, 113, 114, 115, 127. L28, 134, 142, 147, 150, 154, 155, 156, 157. 173, 175. 969. 995, 1106, 1115, 1121, 1173, 1191, 1207, 1221. 1372, 1446, 1524, 1617, 1644, 1654, 1735, 1748. 1766. 1801, 1830. renters', 96, 150, 155, 156, 995. 1015. 1277, 1311, 1438, 1636, 1742, 1750. Remittances abroad, 125. Renters' booking policy, 1144, 1158, 1292, 1809, 1820. Rotha, Paul : — memorandum of evidence, 175. Rowson, S. : — appendix to evidence, 125. memoranda of evidence. 109, 159. oral evidence, 1 1 6. Scenario author, 114, 150, 154. 169, 173, 1070. J2(iO. 1H7 7. 1821, 1838. Special exhibition value, 132, 134, 147, 154, 155, 170, 1517. Strand Film Co.. Ltd. :— memorandum of evidence, 170. Television, 134. Theatrical Artists' Film Society : — memorandum of evidence, 171. Trades Union Congress General Council : — memorandum of evidence, 171. Woolf, H. Bruce :— memorandum of evidence, 127. oral evidence, 128. Wvnn, Wing ('..,,-in. W. E.. H.A.F. (retd.) :— memorandum of evidence, 173. (37873-11) Wt, 1557 A- 6886 375 10/36 P.St. G. 335 S.O. Code No. 51-213-2 The Museum of Modern Art 300039899