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Metro-Goldwyn-Mayer

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"MGM" redirects here. For other uses, see MGM (disambiguation).

Metro-Goldwyn-Mayer or MGM, was, until 2005, a media company, involved primarily in the production and distribution of cinema and television programs. The company was acquired by a partnership led by Sony and Comcast Corporation for $US 4.8 billion. The sale was completed on April 8, 2005.

File:Mgmlogob.jpg
Leo the Lion in the MGM logo since 2001

Organization

MGM's principal subsidiaries are:

History

The beginning

The name combines those of three film production companies which merged in April, 1924: Metro Pictures Corporation (formed in 1916), Goldwyn Pictures Corporation (1917), and Louis B. Mayer Pictures (1918). M-G-M was controlled by Loews, Inc., the vaudeville-and-movie theater chain founded by Marcus Loew in 1904. Because of his success as an independent producer, Louis B. Mayer was made head of the studio, with Harry Rapf and the twenty-five year old "boy wonder" Irving Thalberg as heads of production. Though Loew's Metro was the dominant partner, Goldwyn provided the production facility at their Culver City studio, as well as mascot Leo the Lion (Metro's symbol was a parrot.) Goldwyn's corporate motto "Ars Gratia Artis'' (Art for Art's Sake) also survived the merger.

Also inherited from Goldwyn was a runaway production, Ben-Hur, which had been filming in Rome for months without producing much usable film. Mayer showed his command of the situation by scrapping most of what had been shot and bringing production back to Culver City. Though Ben-Hur was the most costly film made up to its time, it became M-G-M's first great public-relations triumph, establishing an image for the company that persisted for years.

Marcus Loew died in 1927, and control of Loews passed to his associate, Nicholas Schenck. Rival theater-owner and entrepreneur William Fox saw an opportunity to expand his empire, and in 1929, with Schenck's assent, bought the Loew family's holdings. Mayer and Thalberg, employees and not shareholders, were outraged; Mayer in particular used his political connections to launch a Justice Department action. Also working for them was a bit of morbid luck: Fox was badly injured in a car accident; by the time he recovered, the 1929 stock-market crash had left him broke, and the Loew deal was off. Having seen his chance to make an instant fortune evaporate, Schenck resented Mayer immensely, and so the Fox incident led to a Hollywood-New York antagonism that would last for thirty years.

MGM's golden age

Right from the beginning, MGM tapped into the audience's need for glamour and sophistication. Having inherited few big names from their predecessor companies, Mayer and Thalberg began at once to create (and publicize) a host of new stars, among them Greta Garbo, John Gilbert, William Haines, Norma Shearer and Joan Crawford. Established names like Lon Chaney, William Powell, Buster Keaton and Wallace Beery were hired from other studios. The arrival of talking pictures in 1928-29 gave opportunities to other new stars, many of whom would carry MGM through the 1930s: Clark Gable, Jean Harlow, Robert Montgomery, Myrna Loy, Jeanette MacDonald and Nelson Eddy among them.

Like its rivals, MGM produced fifty pictures a year. Loews theaters were mostly located in New York and the northeast, so MGM films were often sophisticated, polished entertainments. As the depression deepened, MGM could make a claim its rivals could not: it never lost money. No matter how bad the economy, MGM showed a profit every quarter all through the thirties.

Irving Thalberg, always physically frail, was removed as head of production in 1932. L.B. Mayer encouraged other staff producers, among them his son-in-law, David O. Selznick, but no one seemed to have the sure touch of Thalberg. Rumors flew that Thalberg was leaving to set up his own independent company; his early death in 1936 at age thirty-seven, cost MGM dearly in terms of quality. Still, the company remained profitable, although a change toward "series" pictures (Andy Hardy, Maisie, the Thin Man' pictures, et al.) is seen by some as evidence of Mayer's restored influence.

Increasingly, before and during World War II, Mayer came to rely on his "College of Cardinals", senior producers who controlled the studio's output. This management-by-committee may explain why MGM seemed to lose its momentum, developing few new stars and relying on the safety of sequels and bland material. Production values remained high, and even 'B' pictures carried a polish and gloss that made them expensive to mount, and artificial in tone. After 1940, production was cut from fifty pictures a year to a more manageable twenty-five features per year.

During this time MGM also launched an animation unit. Hugh Harman and Rudolph Ising came from Warner Bros, and were joined in 1941 by Tex Avery. It was Avery who gave the unit its image, with successes like Red Hot Riding Hood, Swing Shift Cinderella, and the Droopy series. MGM's biggest cartoon stars, however, were the cat-and-mouse duo of Tom and Jerry, created by William Hanna and Joseph Barbera. Tom and Jerry won several Oscars and nominations.

As audiences drifted away after the war, MGM found it rough going. While other studios backed away from the popular musicals of the war years, MGM increased its output to as many as five or six each year, roughly one-quarter of its annual output. Such pictures were expensive to produce, requiring a full staff of songwriters, arrangers, musicians, dancers, and technical support, and mounting five or six each year ate into profits. By the late forties, as MGM's profit margins became paper-thin, word came from New York: find another "boy genius" who could up quality while paring costs. L.B. Mayer thought he had found this savior in Dore Schary, a writer and producer who had had a couple of successful years running RKO.

Mayer's taste for wholesomeness and "beautiful" movies conflicted with Schary's charge to cut costs and produce better pictures. In August of 1951, after a period of friendly antagonism with Schary, Mayer's employment was terminated by Nicholas Schenck. An embittered Mayer, dismissed after twenty-seven years as head of the studio, never produced another picture.

Gradually cutting loose expensive contract actors, Schary managed to keep the studio running much as it had through the early 1950s. Under Schary, MGM produced some well-regarded musicals, among them An American in Paris, Singin' in the Rain and The Band Wagon. But generally it was a losing fight, as the mass audience preferred to stay home with television.

In 1954, as a settlement of the government's restraint-of-trade action, U.S. vs. Paramount Pictures, et al., Loews, Inc. gave up control of MGM. It would take another five years before the interlocking arrangements were completely undone, by which time both Loews and MGM were sinking.

The lion loses its roar

As the studio system faded in the late 1950s and 1960s, so did MGM's prestige. In 1957 (by coincidence, the year L.B. Mayer died) the studio lost money for the first time. Prior to this, in 1956, cost overruns and the failure of the big-budget epic Raintree County prompted the studio to release Schary from his contract. Schary's reign at MGM had been marked with few bona-fide hits, and his departure (along with the retirement of Schenck in 1955) left a power vacuum that would prove difficult to fill.

Television, thought to be a passing fad, increasingly dominated entertainment, and at the urging of Leonard Goldenson, longtime head of Paramount's theater chain who now ran ABC, MGM made a few feeble moves into the new medium. Like those of the other studios, MGM's first attempts at programming were either glorified trailers (M-G-M Parade), or based on past movie successes like The Thin Man or The Courtship of Eddie's Father.

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The MGM logo at time of 2001: A Space Odyssey release in 1968.

1957 also marked the end of the cartoon era at MGM, as the animation unit was closed. Hanna and Barbera left to start Hanna-Barbera Productions, and production of Tom and Jerry shorts was outsourced, first to an Eastern European-based unit led by Gene Deitch, and then to Chuck Jones's "Sib Tower 12 Productions". Jones' group also produced their own works, winning an Oscar for The Dot and the Line, as well as producing the classic television version of How the Grinch Stole Christmas! (with Theodore Geisel). Jones' association with MGM ended in 1967.

MGM fell into a habit in this period which would eventually sink the studio: an entire year's production schedule was reliant on the success of one big-budget epic each year. This policy began well, in 1959, when an expensive remake of Ben-Hur was profitable enough to carry the studio through 1960. But later attempts at big-budget epics failed, among them Cimarron (1961), Four Horsemen of the Apocalypse (1961), and most notoriously, the 1962 remake of Mutiny on the Bounty.

As MGM sank (along with the other main-line studios), a series of studio heads came and went, along with a succession of corporate managers, all hoping to bring back the studio's glory days.

Kerkorian takes over

In 1967, MGM was sold to the Canadian investor Edgar Bronfman, Sr. (whose son Edgar, Jr. would later buy Universal Studios.) Two years later, an increasingly unprofitable MGM was bought (though some say raided) by Nevada millionaire Kirk Kerkorian. What appealed to Kerkorian was MGM's Culver City real estate, and the value of 45 years' worth of glamour associated with the name, which he attached to a Las Vegas hotel and casino. As for film-making, that part of the company was quickly and severely downsized under the supervision of James T. Aubrey, Jr. Aubrey, known from his days as head of programming at CBS as "the smiling cobra", sold off the studio's accumulation of props, furnishings and historical memorabilia, including Dorothy's red slippers (from The Wizard of Oz). Also put up for sale was venerable Lot 3, 40 acres (160,000 m²) of back-lot property which became an up-scale real-estate project.

Through the 1970s studio output slowed considerably; Aubrey preferred four or five medium-budget pictures each year, along with a smattering of low-budget fare. With output cut back so severely, Kerkorian closed MGM's sales and distribution offices in 1973, handing that duty to United Artists. Kerkorian now distanced himself from the operations of the studio, focusing on his casino properties. Another chunk of the back lot was sold in 1974; the last shooting done on the backlot was the introductory segments for That's Entertainment! a retrospective documentary that became a hit for the studio.

In 1979, Kerkorian conceded that MGM was now primarily a hotel company, but he did commit to increased production and an expanded film library when he bought the sinking United Artists in 1981.

MGM/UA, Turner and Pathe

Following the United Artists acquisition, the company was re-christened "MGM/UA Communications." UA, which was essentially bankrupt following the disaster of Heaven's Gate, cut its production schedule sharply.

Following a failed attempt to take over CBS in 1985, the ambitious media entrepreneur Ted Turner offered to buy MGM/UA. But his bankers, concerned about the already heavy debt-load his companies carried, refused to back him, and exactly seventy-four days later, Turner announced he was re-selling most of MGM/UA to Kirk Kerkorian. For roughly one-and-a-half-billion dollars, Turner retained the one MGM asset he really craved, the MGM film library. Kerkorian got United Artists and rights to the MGM name and trademark. The venerable Culver City lot, home to MGM and its predecessor since 1918, was sold to Lorimar, an ambitious television production company.

How much of MGM's back catalogue Turner actually got was a point of conflict for a time; eventually it was determined that Turner owned all of the MGM library, dating back to pre-merger days, as well as the extensive UA library, which comprised of the pre-1948 Warner Bros. catalogue, the entire RKO library, and a good share of United Artists's own backlist.

Having sold and re-purchased MGM, Kerkorian continued to profit from this corporate shell game. In 1990, an obscure Italian promoter, Giancarlo Parretti, announced that he had taken control of France's Pathe Freres, and was about to buy MGM/UA. Despite a cloudy past (and denials of having been sold by Pathe), Parretti got backing from Credit Lyonnais and took control of MGM/UA. But his house of cards quickly collapsed, and in 1992, Parretti having defaulted, Credit Lyonnais became the new owner of MGM.

Despite a few commercial successes, Credit Lyonnais was unable to stem the tide of red ink during the mid-1990s; putting the studio up for sale, it found only one willing bidder: Kirk Kerkorian. Now the owner of MGM for the third time, Kerkorian at last conceded that a solid business plan was the studio's only hope. By committing to more and better pictures, selling a portion of the studio to Australia's Seven Network, and installing a professional management team, Kerkorian was able to convince Wall Street that a revived MGM was worthy of a place on the stock market.

But despite a few successful pictures and a re-built film library, it was clear that MGM could not compete in a business which required hundreds of millions in capital for even the most ordinary picture.

1997-present

In 1997, MGM bought John Kluge's collection of film properties (Orion Pictures, Goldwyn Entertainment, and the Motion Picture Corporation of America), enlarging their catalogue. It was this catalogue, along with the James Bond franchise, which was considered to be MGM's primary asset.

The first suitor was Time Warner; it was not unexpected that Time-Warner would bid, since the largest shareholder in the company was Ted Turner. His Turner Entertainment group had risen to success in part through its ownership of the pre-1986 MGM/UA library.

The leading bidder, though, proved to be Sony, backed by Comcast and venture capital bankers Texas Pacific Group and Providence Equity Partners. As noted above it is expected that MGM will produce occasional films independent of Sony's other units. Time Warner made a counter-bid (which Ted Turner reportedly tried to block), but on September 13, 2004, Sony increased its bid of $11.25/share (roughly $4.7 billion) to $12/share ($5 billion), and Time Warner subsequently withdrew its bid of $11/share ($4.5 billion).

MGM and Sony agreed on a purchase price of nearly $5 billion, of which about $2 billion was to pay off MGM debt [1] [2].

While the MGM name may live on, the United Artists name continues to be utilized on a limited basis.

MGM's Library Today

As of the present day MGM (via the Sony/Comcast consortium) owns nearly all of its own post-1986 library, a majority of the post-1952 United Artists catalog (although it also includes a tiny fraction of pre-1952 UA material), a majority of the Orion Pictures film and television library (which includes material from predecessors American International Pictures and Filmways), the pre-1996 Samuel Goldwyn library, and theatrical distribution rights to the ITC Entertainment catalog (The Return of the Pink Panther, Capricorn One, On Golden Pond, etc.).

Notable films

1920s

1930s

1940s

1950s

1960s

1970s

1980s

1990s

2000s

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