Today, MGM is but a shadow of its former self. Its famed studio backlot and classic movie catalog are owned by two of its much larger rivals. Weakened by management that was slow to embrace the changing entertainment landscape and taken to the verge of collapse by a corporate raider who sold everything that wasn’t nailed down to fund his casino empire, the once mighty lion’s roar has become but a whimper. If we take a look back at Hollywood’s Golden era, however, it is easy to see why MGM was the undisputed king of the jungle.
At the height of its power, MGM had the biggest backlot, the largest stable of stars and the most ambitious slate of films each and every year. Studio head Louis B. Mayer had turned the art of filmmaking into an assembly line process, setting up a facility that could produce more films than any other studio at that time. Unlike in today’s Hollywood, MGM kept all of its actors on payroll. Almost everyone involved in the production of its pictures received a weekly paycheck, benefits and was part of its pension plan. While this created huge overhead for the studio, it ensured that MGM could provide a steady stream of product for the world’s motion picture theaters. It also meant that even the lesser known actors earned a guaranteed paycheck as they would get paid whether they worked or not.
MGM’s immense wealth guaranteed that it would typically get the most talented and successful talent in Hollywood. One of MGM’s biggest challenges was making sure that its resources were utilized as much as possible. Even in an era when the public’s desire for motion picture entertainment seemed insatiable, not every cog in MGM’s machine was always used. Louis B. Mayer quickly figured out a way to utilize his resources even when the company didn’t need them; he could rent them out to other studios. Rather than just rent them out to the highest bidder, however, Mayer would often use his resources to reward studios who he saw as being friends of MGM or who had something he needed. As the 1000 pound gorilla in Hollywood, most studios were willing to play ball with Mayer and his empire.
MGM and Louis B. Mayer’s power came with a dark side; since most talent at the time would sign seven year contracts that required them to do whatever they were asked, a few actors often had to be in projects that they may have hated and pass up projects they liked just because MGM and Mayer wanted them to do something else. Additionally, Mayer would punish uncooperative stars by giving them nothing to do. As long as MGM paid out their salary, they were powerless to do anything about it and couldn’t seek employment outside of the studio. Some actors would see their Hollywood careers wither and die just because they had angered Louis B. Mayer and couldn’t get assigned to any new projects.
MGM’s fall from grace would primarily happen due to its stubborn refusal to fully accept television and Hollywood’s changing economics. MGM’s studio machine was unsustainable in a world where people could watch programming for free in their homes. While MGM’s fall might have been shocking to observers at the time, in retrospect it was hardly surprising.
