Universal Pictures

History

Early years

Universal was founded by Carl Laemmle, Mark Dintenfass, Charles O. Baumann, Adam Kessel, Pat Powers, William Swanson, David Horsley, Robert H. Cochrane and Jules Brulatour. One story has Laemmle watching a box office for hours, counting patrons, and calculating the day's takings. Within weeks of his Chicago trip, Laemmle gave up dry goods to buy the first several nickelodeons. For Laemmle and other such entrepreneurs, the creation in 1908 of the Edison-backed Motion Picture Patents Company (or the "Edison Trust") meant that exhibitors were expected to pay fees for Trust-produced films they showed. Based on the Latham Loop used in cameras and projectors, along with other patents, the Trust collected fees on all aspects of movie production and exhibition and attempted to enforce a monopoly on distribution.

Soon, Laemmle and other disgruntled nickelodeon owners decided to avoid paying Edison by producing their own pictures. In June 1909, Laemmle started the Yankee Film Company with his brothers-in-law Abe Stern and Julius Stern. That company quickly evolved into the Independent Moving Pictures Company (IMP), with studios in Fort Lee, New Jersey, where many early films in America's first motion picture industry were produced in the early 20th century. Laemmle broke with Edison's custom of refusing to give billing and screen credits to performers. By naming the movie stars, he attracted many of the leading players of the time, contributing to the creation of the star system. In 1910, he promoted Florence Lawrence, formerly known as "The Biograph Girl", and actor King Baggot, in what may be the first instance of a studio using stars in its marketing.

The Universal Film Manufacturing Company was incorporated in New York City on April 30, 1912. Laemmle, who emerged as president in July 1912, was the primary figure in the partnership with Dintenfass, Baumann, Kessel, Powers, Swanson, Horsley, and Brulatour. The company was established on June 8, 1912, formed in a merger of Independent Moving Pictures (IMP), the Powers Motion Picture Company, Rex Motion Picture Manufacturing Company, Champion Film Company, Nestor Film Company, and the New York Motion Picture Company. Eventually all would be bought out by Laemmle. The new Universal studio was a vertically integrated company, with movie production, distribution, and exhibition venues all linked in the same corporate entity, the central element of the Studio system era.

Following the westward trend of the industry, by the end of 1912, the company was focusing its production efforts in the Hollywood area.

Keeping leadership of the studio in the family

In 1928, Laemmle Sr. made his son, Carl Jr., head of Universal Pictures, a 21st birthday present. Universal already had a reputation for nepotism—at one time, 70 of Carl Sr.'s relatives were supposedly on the payroll. Many of them were nephews, resulting in Carl Sr. being known around the studios as "Uncle Carl". Ogden Nash famously quipped in rhyme, "Uncle Carl Laemmle/Has a very large faemmle". Among these relatives was future Academy Award-winning director/producer William Wyler.

"Junior," Laemmle persuaded his father to bring Universal up to date. He bought and built theaters, converted the studio to sound production, and made several forays into high-quality production. His early efforts included the critically panned part-talkie version of Edna Ferber's novel Show Boat (1929), the lavish musical Broadway (1929) which included Technicolor sequences; and the first all-color musical feature (for Universal), King of Jazz (1930). The more serious All Quiet on the Western Front (1930) won its year's Best Picture Oscar.

Laemmle Jr. created a niche for the studio, beginning a series of horror films which extended into the 1940s, affectionately dubbed Universal horror. Among them are Dracula (1931), Frankenstein (1931), The Mummy (1932) and The Invisible Man (1933). Other Laemmle productions of this period include Tay Garnett's Destination Unknown (1933), John M. Stahl's Imitation of Life (1934) and William Wyler's The Good Fairy (1935).

The Laemmles lose control

Universal's forays into high-quality production spelled the end of the Laemmle era at the studio. Taking on the task of modernizing and upgrading a film conglomerate in the depths of the Great Depression was risky, and for a time, Universal slipped into receivership. The theater chain was scrapped, but Carl Jr. held fast to distribution, studio, and production operations.

The end for the Laemmles came with a lavish version of Show Boat (1936), a remake of its earlier 1929 part-talkie production, and produced as a high-quality, big-budget film rather than as a B-picture. The new film featured several stars from the Broadway stage version, which began production in late 1935, and unlike the 1929 film, was based on the Broadway musical rather than the novel. Carl Jr.'s spending habits alarmed company stockholders. They would not allow production to start on Show Boat unless the Laemmles obtained a loan. Universal was forced to seek a $750,000 production loan from the Standard Capital Corporation, pledging the Laemmle family's controlling interest in Universal as collateral. It was the first time Universal had borrowed money for a production in its 26-year history. The production went $300,000 over budget; Standard called in the loan, cash-strapped Universal could not pay, and Standard foreclosed and seized control of the studio on April 2, 1936.

Although Universal's 1936 Show Boat (released a little over a month later) became a critical and financial success, it was not enough to save the Laemmles' involvement with the studio. They were unceremoniously removed from the company they had founded, with studio advertisements referring to "the new Universal". Because the Laemmles personally oversaw production, Show Boat was released (despite the takeover) with Carl Laemmle and Carl Laemmle Jr.'s names on the credits and in the film's advertising campaign. Standard Capital's J. Cheever Cowdin had taken over as president and chairman of the board of directors and instituted severe cuts in production budgets. Joining him were British entrepreneurs C.M. Woolf and J. Arthur Rank, who bought a significant stake in the studio. Gone were the big ambitions, and though Universal had a few big names under contract, those it had been cultivating, like William Wyler and Margaret Sullavan, left.

Meanwhile, producer Joe Pasternak, who had been successfully producing light musicals with young sopranos for Universal's German subsidiary, repeated his formula in the United States. Teenage singer Deanna Durbin starred in Pasternak's first American film, Three Smart Girls (1936). The film was a box-office hit and reputedly resolved the studio's financial problems. The film's success led Universal to offer her a contract, which for the first five years of her career, produced her most successful pictures.

Universal-International and Decca Records

In 1945, J. Arthur Rank, who had already owned a stake in the studio almost a decade before, hoping to expand his American presence, bought into a four-way merger with Universal, the independent company International Pictures, and producer Kenneth Young. The new combine, United World Pictures, was a failure and was dissolved within one year. However, Rank and International remained interested in Universal, culminating in the studio's reorganization as Universal-International; the merger was announced on July 30, 1946. William Goetz, a founder of International along with Leo Spitz, was made head of production at the renamed Universal-International Pictures, a subsidiary of Universal Pictures Company, Inc. which also served as an import-export subsidiary, and copyright holder for the production arm's films. Goetz, a son-in-law of Louis B. Mayer, decided to bring "prestige" to the new company. He stopped the studio's low-budget production of B movies, serials and curtailed Universal's horror and "Arabian Nights" cycles. He also reduced the studio's output from its wartime average of fifty films per year (nearly twice the major studio's output) to thirty-five films a year. Distribution and copyright control remained under the name of Universal Pictures Company Inc.

Goetz set out an ambitious schedule. Universal-International became responsible for the American distribution of Rank's British productions, including such classics as David Lean's Great Expectations (1946) and Laurence Olivier's Hamlet (1948). Broadening its scope further, Universal-International branched out into the lucrative non-theatrical field, buying a majority stake in home-movie dealer Castle Films in 1947 and taking the company over entirely in 1951. For three decades, Castle would offer "highlights" reels from the Universal film library to home-movie enthusiasts and collectors. Goetz licensed Universal's pre–Universal-International film library to Jack Broeder's Realart Pictures for cinema re-release, but Realart was not allowed to show the films on television.

The production arm of the studio still struggled. While there were to be a few hits like The Killers (1946) and The Naked City (1948), both produced by Mark Hellinger, Universal-International's new theatrical films often met with disappointing response at the box office. By the late 1940s, Goetz was out. The studio returned to low-budget and series films such as Ma and Pa Kettle (1949), a spin-off of the studio's 1947 hit The Egg and I and the inexpensive Francis (1950), the first film of a series about a talking mule, became mainstays of the company. Once again, the films of Abbott and Costello, including Abbott and Costello Meet Frankenstein (1948), were among the studio's top-grossing productions. But at this point, Rank lost interest and sold his shares to the investor Milton Rackmil, whose Decca Records would take full control of Universal in 1952. Besides Abbott and Costello, the studio retained the Walter Lantz cartoon studio, whose product was released with Universal-International's films.

MCA takes over

In the early 1950s, Universal set up its own distribution company in France. In the late 1960s, the company also started a production company in Paris, Universal Productions France S.A., although sometimes credited by the name of the distribution company, Universal Pictures France. Except for the two first films it produced, Claude Chabrol's Le scandale (English title The Champagne Murders, 1967) and Romain Gary's Les oiseaux vont mourir au Pérou (English title Birds in Peru), it was only involved in French or other European co-productions, including Louis Malle's Lacombe, Lucien, Bertrand Blier's Les Valseuses (English title Going Places, 1974), and Fred Zinnemann's The Day of the Jackal (1973). It was only involved in approximately 20 French film productions. In the early 1970s, the unit was incorporated into the French Cinema International Corporation arm.

In 1954, the studio loaned out television syndication rights to the black-and-white cartoons produced by Walter Lantz Productions to Motion Pictures for Television (later absorbed into Guild Films). In 1957, Universal-International secured a deal with Screen Gems, a television subsidiary of Columbia Pictures Corporation to license 600 of its pre-1948 sound films for $20 million.

By the late 1950s, the motion picture business was again changing. The combination of the studio/theater-chain breakup and the rise of television saw the reduced audience size for cinema productions. The Music Corporation of America (MCA), the world's largest talent agency, had also become a powerful television producer, renting space at Republic Studios for its Revue Productions subsidiary. After a period of complete shutdown, a moribund Universal agreed to sell its 360-acre (1.5 km2) studio lot to MCA in 1958 for $11 million, renamed Revue Studios. MCA owned the studio lot, but not Universal Pictures, yet was increasingly influential on Universal's products. The studio lot was upgraded and modernized, while MCA clients like Doris Day, Lana Turner, Cary Grant, and director Alfred Hitchcock were signed to Universal contracts.

The long-awaited takeover of Universal Pictures by MCA, Inc. happened in mid-1962 as part of the MCA-Decca Records merger. As a final gesture before leaving the talent agency business, virtually every MCA client was signed to a Universal contract. In 1963, MCA formed Universal City Studios, Inc., merging the motion pictures and television arms of the formerly Universal Pictures Company and Revue Studios (which was officially renamed as Universal Television). And so, with MCA in charge, Universal became a full-blown, A-film movie studio, with leading actors and directors under contract; offering slick, commercial films; and a studio tour subsidiary launched in 1964.

Matsushita and Seagram

Anxious to expand the company's broadcast and cable presence, longtime MCA head Lew Wasserman sought a rich partner. He located Japanese electronics manufacturer Matsushita Electric (now known as Panasonic), which agreed to acquire MCA for $6.6 billion in 1990.

In 1992, three years after the U.S. branch of Cineplex Odeon Films folded, Universal teamed up with PolyGram Filmed Entertainment to launch Gramercy Pictures for release of arthouse films. Universal first sold its stake in Gramercy Pictures in 1996, then acquired October Films in 1997.

On December 9, 1996, the new owners dropped the MCA name; the company became Universal Studios Inc. and MCA's music division, MCA Music Entertainment Group, was renamed Universal Music Group. MCA Records continued to live on as a label within the Universal Music Group. The following year, G. P. Putnam's Sons was sold to the Penguin Group subsidiary of Pearson PLC.

Matsushita provided a cash infusion, but the clash of cultures was too great to overcome, and five years later, Matsushita sold an 80% stake in MCA/Universal to Canadian drinks distributor Seagram for $5.7 billion. Seagram sold off its stake in DuPont to fund this expansion into the entertainment industry. Hoping to build an entertainment empire around Universal, Seagram bought PolyGram from Philips in 1999 and other entertainment properties, but the fluctuating profits characteristic of Hollywood were no substitute for the reliable income stream gained from the previously held shares in DuPont.

Extensions and NBCUniversal/Comcast era

In 1999, after selling October Films, Universal launched its new arthouse label, a second iteration of Universal Classics, which was soon renamed Universal Focus in 2000. Afterward, Universal Pictures acquired the United States distribution rights of several of StudioCanal's films, such as David Lynch's Mulholland Drive (2001) and Brotherhood of the Wolf (2001) which became the sixth-highest-grossing French-language film of all time in the United States. Universal Pictures and StudioCanal also co-produced several films, such as Love Actually (2003); a $40 million-budgeted film that eventually grossed $246 million worldwide. In late 2000, the New York Film Academy was permitted to use the Universal Studios backlot for student film projects in an unofficial partnership.

In late 2005, Viacom's Paramount Pictures acquired DreamWorks SKG after acquisition talks between GE and DreamWorks stalled. Universal's long-time chairperson, Stacey Snider, left the company in early 2006 to head up DreamWorks. Snider was replaced by then-Vice chairman Marc Shmuger and Focus Features head David Linde. On October 5, 2009, Marc Shmuger and David Linde were ousted, and their co-chairperson jobs were consolidated under former president of worldwide marketing and distribution Adam Fogelson, becoming the single chairperson. Donna Langley was also upped to co-chairperson. In 2009, Stephanie Sperber founded Universal Partnerships & Licensing within Universal to license consumer products for Universal.

In September 2013, Adam Fogelson was ousted as co-chairman of Universal Pictures, promoting Donna Langley to the sole chairperson. In addition, NBCUniversal International chairman Jeff Shell would be appointed as chairman of the newly created Universal Filmed Entertainment Group. Longtime studio head Ron Meyer would give up oversight of the film studio and appointed vice chairman of NBCUniversal, providing consultation to CEO Steve Burke on all of the company's operations. Meyer retained oversight of Universal Parks and Resorts.

Universal's multi-year film financing deal with Elliott Management expired in 2013. In summer 2013, Universal made an agreement with Thomas Tull's Legendary Pictures to distribute their films for five years starting in 2014 (the year that Legendary's similar agreement with Warner Bros. Pictures ended).

In June 2014, Universal Partnerships took over licensing consumer products for NBC and Sprout with the expectation that all licensing would eventually be centralized within NBCUniversal.

Units

Universal Pictures International

Universal International Distribution

Universal Pictures Home Entertainment

Universal Home Entertainment Productions

Universal 1440 Entertainment

DreamWorks Animation Home Entertainment

Universal Sony Pictures Home Entertainment Australia (joint venture with Sony Pictures Home Entertainment)

Universal Playback

Studio Distribution Services (joint venture with Warner Bros. Discovery Home Entertainment)

Focus Features

Universal Pictures International Entertainment

NBCUniversal Entertainment Japan

Working Title Films

WT2 Productions

Working Title Television

Rede Telecine (former; 12.5%, joint venture with Canais Globo, Walt Disney Studios, Paramount Pictures and Metro-Goldwyn-Mayer)

Illumination

Illumination Studios Paris

Illumination Labs

Moonlight

DreamWorks Animation

Filmography

Highest-grossing films

Universal was the first studio to have released three billion-dollar films in one year; this distinction was achieved in 2015 with Furious 7, Jurassic World, and Minions.

‡ Includes theatrical reissue(s).