Marcus Loew(1870-1927)
- Producer
His film resume belies the fact that he was the most important man in
motion pictures at the time of his death. Born as Max Loew in New York
City to a poverty-stricken Viennese waiter, his life could've easily
gone the the way of many boys of the east side slums, except that he
was hyper-enterprising. He was also extremely superstitious: he never
walked under ladders, distrusted nearly every doctor he met and refused
to sign anything on a Friday (a habit that was often mistaken for
something semitic; he was Jewish but decidedly non-practicing). Loew
left school at nine and never looked back. Loew sold newspapers and
lemons on the street, worked like a dog in an industrial printing
plant, and began and failed at several business ventures - a print
shop, furniture store and a fur factory - going bankrupt before he was
20. It's a testimonial to his personality and self-assurance that he
picked himself up from these early failures and persevered. A second
stab at the fur business brought him in contact with
Adolph Zukor who became a friend and
partner. Loew bought into a Zukor's penny arcade business and set about
expanding it around the country. While opening up a new arcade in
Cincinnati he was told of a competitor who was scoring bigger money
with motion pictures than his mechanical machines. Loew struck up a
deal with the Vitagraph Company for the necessary equipment and films,
borrowed chairs and based on nickel admissions, grossed almost $250 the
first day. Back in New York, Loew bought a Brooklyn burlesque house and
converted it into the Royal, a first class house mixing the vaudeville
bill with movies. The success of the Royal convinced him to convert his
penny arcades into movie houses. Loew struck up a fateful business deal
with brothers Joseph M. Schenck and
Nicholas Schenck in 1906 when the group
formed the Fort George Amusement Company and began a Paradise Park
concession stand. Over the next decade Loew worked a slow (being a
relative term in the business), methodical plan for theatrical
dominance. By Armistice Day he owned 112 theaters that continued to
offer a mix of vaudeville and movies. Joe Schenck ventured away from
the company to become a movie producer.
By 1920 Loew was the dominant movie theater owner in New York and had recently expanded into Canada. With this expansion he faced increasing problems obtaining a reliable supply of quality films, especially problematic since audiences were pushing vaudeville acts off his stages. On January 3, 1920 he paid $3.1 million for Metro Pictures, a Hollywood studio with a lot of potential but suffering from poor management and a middling track record of success. Marcus Loew understood the value of his theatrical empire but felt that movie production was too huge a gamble to personally manage. At heart he was a New Yorker and felt comfortable handling the finances, not the mechanics of grinding out pictures in far-away Hollywood. It was at this juncture that Louis B. Mayer enters the story - Louis B. Mayer Productions was a far smaller shaker in town, but had three key assets: a successful track record of producing profitable melodramas that played well in the sticks, wunderkind producer Irving Thalberg - recently hired away from Universal and who rapidly proved his worth as a producer all consumed with movie production, and L.B. himself - admittedly a great macro manager, who shared Loew's rise from nothing life story. Oddly, Loew was only impressed with two of these factors; he didn't want Thalberg! He caved after Mayer insisted that any merger include his key producer (one of the wisest manoeuvrings L.B. would ever make). Loew's Metro company was then courting a third studio, troubled Goldwyn Productions (see Samuel Goldwyn). Loew was attracted to its state-of-the art studio and 40-acre lot, an asset that he understood. Unfortunately, the Goldwyn company was hemorrhaging red ink due to an out-of-control production in Italy, Ben-Hur A Tale of the Christ (1925), and was, closer to home, immersed in Erich von Stroheim's costly exercise in artistic overindulgence, Greed (1924), which only further demonstrated the need for competent management. Louis B. Mayer Productions was, despite its relatively insignificant size, the key to the merger. The parties worked out a percentage agreement and Loew merging a third troubled company into the fold, Goldwyn Pictures, which he had purchased for $4.3 million. The conglomerate bought Louis B. Mayer Productions for a mere $76,500 which tells something of the state of L.B.'s hard assets at the time of the merger. Metro-Goldwyn Pictures was formed on May 16, 1924 and dominated by Mayer's management team with Thalberg quickly rallying the best writers, directors, actors and technicians amongst the 3 former concerns. Mayer himself was named vice president and general manager of the new company at $1,500 a week, but that was dwarfed by a profit participation deal that included Thalberg (adding to his $650 a week salary) and key secretary Robert Rubin. These three men would split 20% of the company's profits, an incredibly rich benefits package as it turned out). Marcus Loew had chosen his personnel well, leaving him exactly in the position he wanted to be, writing checks from his 46 acre Long Island mansion and long weekly constructive arguments with Mayer on the phone. Under Mayer and Thalberg, the combination of these 3 shaky production companies and a huge injection of cash from Loew's Inc. created the premier studio in Hollywood. It's first official Metro-Goldwyn release, He Who Gets Slapped (1924), starring Lon Chaney was a hit. The company's name soon reflected Mayer's presence (the MGM moniker first seen in Buster Keaton's Go West (1925)) and for the next three decades MGM stood apart from every other operation in Hollywood, or the world for that matter. Unfortunately the early balanced managerial dynamic of Loew, Mayer and Thalberg ended forever when Marcus Loew died on September 5, 1927 at only age 57, leaving a $30 million estate (including 400,000 shares of Loew's Inc. stock) to his wife Caroline and sons. The title as the most powerful man in the film industry was assumed by Nicholas Schenck and MGM, for better or worse, would never be the same.
By 1920 Loew was the dominant movie theater owner in New York and had recently expanded into Canada. With this expansion he faced increasing problems obtaining a reliable supply of quality films, especially problematic since audiences were pushing vaudeville acts off his stages. On January 3, 1920 he paid $3.1 million for Metro Pictures, a Hollywood studio with a lot of potential but suffering from poor management and a middling track record of success. Marcus Loew understood the value of his theatrical empire but felt that movie production was too huge a gamble to personally manage. At heart he was a New Yorker and felt comfortable handling the finances, not the mechanics of grinding out pictures in far-away Hollywood. It was at this juncture that Louis B. Mayer enters the story - Louis B. Mayer Productions was a far smaller shaker in town, but had three key assets: a successful track record of producing profitable melodramas that played well in the sticks, wunderkind producer Irving Thalberg - recently hired away from Universal and who rapidly proved his worth as a producer all consumed with movie production, and L.B. himself - admittedly a great macro manager, who shared Loew's rise from nothing life story. Oddly, Loew was only impressed with two of these factors; he didn't want Thalberg! He caved after Mayer insisted that any merger include his key producer (one of the wisest manoeuvrings L.B. would ever make). Loew's Metro company was then courting a third studio, troubled Goldwyn Productions (see Samuel Goldwyn). Loew was attracted to its state-of-the art studio and 40-acre lot, an asset that he understood. Unfortunately, the Goldwyn company was hemorrhaging red ink due to an out-of-control production in Italy, Ben-Hur A Tale of the Christ (1925), and was, closer to home, immersed in Erich von Stroheim's costly exercise in artistic overindulgence, Greed (1924), which only further demonstrated the need for competent management. Louis B. Mayer Productions was, despite its relatively insignificant size, the key to the merger. The parties worked out a percentage agreement and Loew merging a third troubled company into the fold, Goldwyn Pictures, which he had purchased for $4.3 million. The conglomerate bought Louis B. Mayer Productions for a mere $76,500 which tells something of the state of L.B.'s hard assets at the time of the merger. Metro-Goldwyn Pictures was formed on May 16, 1924 and dominated by Mayer's management team with Thalberg quickly rallying the best writers, directors, actors and technicians amongst the 3 former concerns. Mayer himself was named vice president and general manager of the new company at $1,500 a week, but that was dwarfed by a profit participation deal that included Thalberg (adding to his $650 a week salary) and key secretary Robert Rubin. These three men would split 20% of the company's profits, an incredibly rich benefits package as it turned out). Marcus Loew had chosen his personnel well, leaving him exactly in the position he wanted to be, writing checks from his 46 acre Long Island mansion and long weekly constructive arguments with Mayer on the phone. Under Mayer and Thalberg, the combination of these 3 shaky production companies and a huge injection of cash from Loew's Inc. created the premier studio in Hollywood. It's first official Metro-Goldwyn release, He Who Gets Slapped (1924), starring Lon Chaney was a hit. The company's name soon reflected Mayer's presence (the MGM moniker first seen in Buster Keaton's Go West (1925)) and for the next three decades MGM stood apart from every other operation in Hollywood, or the world for that matter. Unfortunately the early balanced managerial dynamic of Loew, Mayer and Thalberg ended forever when Marcus Loew died on September 5, 1927 at only age 57, leaving a $30 million estate (including 400,000 shares of Loew's Inc. stock) to his wife Caroline and sons. The title as the most powerful man in the film industry was assumed by Nicholas Schenck and MGM, for better or worse, would never be the same.
