The period from the end of the First World War to the mid 1920s was the heyday for the independent cinema circuits such as Thompson’s. The quality of films was improving, the social range of the audience was broadening and technology was advancing. Yet by the late 1920s the power of independent exhibitors was beginning to wane. However Thomas Thompson was more than just a cinema owner.
Throughout his career he was not only an exhibitor, a renter and a small-scale producer, but was also involved in national bodies including the CEA and, while a renter, the Incorporated Association of Film Renters Limited, not only to protect his position but to offer the benefit of his experience to his chosen industry. It is therefore interesting to look at the topics where records exist of his public involvement and to try to work out why he took the stands he did. Records of his involvement can be found in relation to quotas to protect British productions; the campaign against block and blind booking; renter pre-releases; and the CEA Trading Scheme.
Quotas and blind and block booking
To understand the calls for quotas and the connected issues surrounding blind and block booking, it is necessary to look first at the balance of power within the industry after the First World War between the three interest groups of exhibitors, renters and film makers. In the worst position were the British producers, who had stopped production during the war. They had not been in a healthy position before the war, so they were now all but starting from scratch and were facing serious competition from the strong American producers.
After the war there were still a large number of small independent renters. Thompson was one of them. It is interesting to note that in 1913 a renter paid £6,000 for the rights to Quo Vadis 1. This sum must, presumably, have been for full national rights but even so equate to around £360,000, in modern money. It was therefore an important business involving not inconsiderable sums of money, and a renter was not merely an unimportant middle-man between producer and exhibitor. As the whole cinema business grew rapidly, it became more and more difficult for the smaller independent renters to survive. While the number of outlets was now much greater, so were the sums being demanded from the producers for the sale of rights to films.
Thompson retired as a renter in 1917 “in order to devote himself more assiduously to the exhibiting side of the industry” 2. After the restraints on building new cinemas and the general economic situation over the war years, I suspect Thompson’s decision to get out of renting was, as announced, primarily motivated by the desire to have more time and money available for expanding his exhibition business, which he did considerably in the next few years. He was one among many who believed that the queues at cinemas by the end of the war indicated that the market needed more venues 3.
Thompson seems to have got out of renting at the right time, as by the early 1920s there were a smaller number of large and increasingly powerful rental companies. A number of these companies were American owned or controlled. Naturally they would concentrate on American films and, as some were owned by film producers, even on the films of their parent companies. There were rental companies that specialised in British films, but it was the American companies that prospered through a mixture of business technique and the quality and the quantity of their products. As their films had already been distributed in America those films would usually have more than covered their production costs in America, and so could be released in Britain at a lower cost and so undercut the local product. On the other hand those renters concentrating on British films suffered from the lack of British films, their lack of quality or perhaps more fairly lack of sophistication, and also from the business practices of the successful renters.
The position of exhibitors was complex and much depended on the size of venues. Smaller venues were finding it increasingly difficult to make money as films got longer and the continuous shows of the early days were no longer a feasible way of exhibition. In many areas there had been plenty of demand during the First World War and there was expansion of new venues when the war was over. However that optimism was short-lived with the economic difficulties of the 1920s. The North-East of England was particularly badly hit with its dependence on heavy industry. Indeed in the second half of 1926 over 40 cinemas were forced to close in the North and many others shut for part of the time 4. Thompson’s reaction seems to have been to reduce prices at some of his venues, in some cases maybe only passing on the benefit of Entertainment Tax being removed from tickets priced up to 6d in 1924. He was no doubt fortunate to be able to afford to do that and in having a big enough circuit to be able to use economies of scale to his advantage.
The benefits of exhibitors being in a strong bargaining position were highlighted in the North-Eastern Daily Gazette in 1928. Under a headline reading “DOES MIDDLESBROUGH GET BEST FILMS FIRST?” the paper confirmed Thompson’s bargaining power:
Time and again it is proved that Middlesbrough cinemas are the first in the provinces to secure the best pictures, Leeds and Newcastle are both in the rear. Another instance of Middlesbrough’s priority is provided by ‘Seventh Heaven,’ which will show at the Hippodrome next week before any other cinema in the four northern counties at least.5
There must be some likelihood that this effusive praise had been prompted by Thompson feeling that an earlier article had not praised the local scene sufficiently. Given the news item the following day, Thompson may have been particularly keen for his own position in the locality to be accurately shown so as not to undermine negotiations then in train. That article announced the creation by Gaumont British Picture Corporation of a new company, Denman Picture Houses Limited. 6
Increasingly in the 1920s there were calls for measures to protect and encourage British productions. The interests of the various parties were complicated and interrelated, but there were elements of common purpose between the British producers and the exhibitors in trying to limit the dominant position now held by the renters. The measures discussed were mainly around quotas and the end of block/blind booking. The argument for a quota system was that it would require renters to provide and exhibitors to show a minimum percentage of British films, to break the dominance of American productions. The block booking system was a typical business system that can arise where businesses have unequal bargaining positions. As the renters became stronger, and so more powerful than most exhibitors, they were able to impose increasingly one-sided terms and conditions. Block booking involved requiring exhibitors to sign up for a package of films. Usually there would be one or two films the exhibitor really wanted, but he had no choice but to sign up for the others too. Blind booking went a stage further and involved signing up for films which were not available for advance viewing, either because they were not yet in the country, not yet finished or production had not even started, and which might not be available for up to twelve or eighteen months. Not surprisingly there was much opposition to blind booking but in many cases the exhibitors were not in a strong enough position to resist.
Exhibitors were therefore justifiably unhappy with block and blind booking. Such systems also adversely affected British producers as the block booking system left few slots into which they could get their films booked for showing. The exhibitors could see that the demands for the quota system to encourage the production of British films could also help them with blind and block booking.
How would someone like Thompson have dealt with these problems? As one of the significant exhibitors of the time, he must have been in as good a commercial position as an exhibitor could be. With such a dominant position in his area, he would have been able to secure exclusive arrangements for certain films, albeit at a price, but this would have been to the detriment of his competitors.With a varied portfolio of venues he could, perhaps, have made the most of the block booking system, by showing the best films at his best venues and using the other films at the less prestigious venues or those where there was little or no competition.
In 1925 the CEA, after its conference in Glasgow, set up a Joint Production Committee with the producers to see if a common solution could be found. In the end this got nowhere as the producers would not modify their fundamental position that they wanted a guaranteed number of bookings by exhibitors for British films, while the exhibitors wanted a more flexible approach. It was not so much that the exhibitors were against British film-makers, they simply did not want to be restricted in what they showed at their cinemas. They were running businesses and simply wanted enough good films that would bring audiences in, which was a difficult enough job on its own. Thompson was against the principle of a quota system as he believed that he was the best judge of what his audiences wanted. Reminiscing after the sale of much of his holding to Denman in 1928, Thompson described the problem facing any exhibitor:
The exhibitor is, after all, like the grocer. He has to get his goods from other people. It is not known with any degree of certainty what a picture will be like until it is completed and shown. Pictures are like novels. There are best sellers; there are others. The proportions, I should say, are pretty near the same in each case.7
The second problem, identified in the Kinematograph Year Book 1927, was defining what a British film was, a problem that remains to this day.8 The fundamentalist view of the British producers was that a British film was a completely British film in all aspects i.e. it should be made in Britain, be financed solely in Britain by British backers, and that its cast, director and crew should be British. This view was not accepted in other areas of the business. The producers, realising that the voluntary route was unlikely to yield satisfactory results, returned to lobbying the government, who indicated that they were willing to look at a legislative solution. The CEA General Council, of which Thompson was Treasurer, felt that if legislation was likely, they had better co-operate to try to ensure that their views were properly represented. However that view was not necessarily widely accepted by their members. The CEA General Council set about convincing its members that this was the right way of proceeding. While Thompson had ceased being a renter in 1917, he obviously knew the industry from all angles, and so his views on topics such as this were much respected and influential, at least at the highest level.
After many months of, sometimes heated, debates a vote was held and out of the 71 per cent of members voting, the legislative route was accepted by a majority of 1,704 to 198.9
Among other interest groups the CEA prepared their own version of a proposed bill for discussion. This was limited to preventing block booking, which was really a provision against the power of renters and was only indirectly likely to benefit British producers, in that they would have been able to book films and not be cut out completely. It did not go far enough for the producers. Given the repeated failures of the parties to agree, the government stepped in and eventually the Cinematograph Films Act 1927 was passed. It aimed to restrict blind and block booking by requiring films to be registered. They had to exist to be registered and advance booking was limited to six months. In addition, a quota system was introduced. Once again there was a registration system. The renter’s quota was 7½ per cent for the first year rising to 20 per cent in 1936-8. The exhibitor’s quota was 5 per cent for the first year rising to 20 per cent in 1936-38. As with so many compromises the Act was flawed. The definition of what was a “British” film referred to “British” companies rather than “British controlled” companies. It did not cater adequately for circumstances where a renter/exhibitor simply could not obtain enough British films to satisfy the quota. Finally, no quota system could guarantee that the films would be of any quality, and many made under the system, later described as “quota quickies”, took advantage of this, being cheap short and lacking quality. Thompson himself seems to have taken advantage of the new system with his new production, Neath Skies of Spain, in 1928 and the re-issue of Rilka, Gypsy Queen.
Pre-release by renters
Another particular dispute arose when the distinction between renters, exhibitors and producers became blurred. From around 1920 renters had realised that an extra way of making profits was to give a pre-release run of particular films. By this they could make money from ticket sales, and create a demand for certain films that could increase the rental price. Exhibitors never liked this, so any further expansion by renters into exhibition was viewed suspiciously. There were obvious reasons why strong American producers should get into the rental business as it gave them a good outlet for their products. While those companies could already dictate the terms upon which their products were shown, there seemed no real need for them to expand further and become exhibitors, but when it did happen British exhibitors were anxious as to where this was leading. They could see a time when all studios would control a circuit, leading to independent exhibitors being denied the more lucrative premieres and first showings of films in their region. The focus for their anger was Famous-Lasky in 1926. They already produced and rented films and had dabbled in exhibition in 1919, to complaints from exhibitors. Now they acquired two cinemas in Birmingham. Local exhibitors wanted a national boycott on renters who acted in this way. The CEA took a national vote on such a boycott. The result of the northern area vote was 81 in favour and 70 against. Thompson had been unable to persuade his local colleagues to vote against, or perhaps they doubted his motives or were jealous of his success. Most likely they were simply concerned about a new threat. He instantly resigned as Council delegate and as Treasurer of the CEA, explaining that he could not go to meetings of the General Council and “uphold ideas which he did not favour” 10. Much was made of Thompson’s stand.
In the end however Thompson’s view prevailed, given the inevitability that such a boycott would never hold against the commercial imperative of needing films to rent to keep exhibition businesses going and an agreement was reached with Famous-Lasky.11
It is interesting to consider whether Thompson’s position reflected the pragmatism of a seasoned veteran, or whether he had any inkling that circuits such as his might be attractive to similar ventures to Famous-Lasky in years to come. While such an ulterior motive theory is intriguing, and while it was only to be one year later that Gaumont established its first such venture, Thompson was a practical man and as, with hindsight, it seems so obvious that such a boycott would fail, it seems most likely that this view led him to express the views he did.
The “Trading Scheme”
Before the end of 1927 Thompson was involved in another national cinema industry debate, this time relating to what was known as the “Trading Scheme”. Essentially this was intended to be a co-operative booking scheme. The idea was that it would help the smaller exhibitors by putting them in a better bargaining position with the renters. Cinemas would be put in one of three categories and contribute capital to the scheme depending on that categorisation. At a CEA meeting in Newcastle Thompson vehemently opposed the scheme, prompting headlines of “STRAIGHT TALK AT NEWCASTLE”, “THOMPSON AND MORRISON IN OPPOSITION” and “Arguments Over the Trading Scheme”. 12 Nationally the scheme was opposed by the commercial circuits as it presumably offered them no benefits. Thompson voiced his concerns on commercial grounds:
The only scheme with which I can compare it is that of the C.W.S. and the co-operative societies. Can you tell me of people, not in the co-operative societies, who are not doing as well as those who are in it?13
As a successful exhibitor it must also be likely that his view was that he could deal satisfactorily with the renters he knew, and such a scheme might improve the quality of films shown by some of his less successful or astute competitors. As before, he seems to have picked the winning side, although the Trading Scheme really failed when the Kinematograph Renters’ Society voted not to trade with it. They showed the unity that had always eluded the CEA at times of crisis.