Kristin Thompson. 'The End of the "Film Europe" Movement'. In T. O'Regan & B. Shoesmith eds. History on/and/in Film. Perth: History & Film Association of Australia, 1987. 45-56.
In this paper I will discuss the decline of one major trend within 1920s film history that has been largely forgotten: the movement to create "Film Europe". This was a name frequently applied at the time to a series of attempts by major European production companies to create a large, cooperative market. Their purpose was to foster their own films by offering a united front against American hegemony. This effort affected the business and artistic sides of filmmaking to a considerable extent during the second half of the decade. I will concentrate on the business side here.
The move toward European cooperation began in 1924 and gradually achieved some degree of effectiveness. "Film Europe" reached its height in 1928-29 and declined rapidly thereafter. Indeed, not surprisingly, its fortunes paralleled the rise and fall of a general movement among leftist politicians toward a federation of European states - an idea based both upon the hope of preventing future wars and the goal of countering America economic power. Similarly, the practice of creating pan-European industrial cartels and trusts emerged in the early to mid-twenties, and film industry officials were thus following a wider trend. I am currently at work on a book on the period from the end of the war to the mid-1930s, which will deal with the rise and fall of the "Film Europe" movement. Since our subject is the 1930s, I shall necessarily be presenting to you material which will come toward the end of the projected book. Hence I must spend the first portion of my paper summarizing the causes and achievements of the Film Europe movement, before going on to discuss the effects of rising nationalism on the film industry. The three countries I will concentrate on in that section are France, Germany, and the USSR, since they are the only ones which produced significant national stylistic movements in the 1920s - and my overall concern in my book will be with the external pressures that caused changes in those styles.
I would like to suggest briefly the outline of that project. Everyone is aware that three major stylistic movements occurred within the commercial cinema in the decade after World War I: Expressionism in Germany, Impressionism in France, and the Montage school in the USSR. When I first started in film studies, these were treated as distinct, separate stylistic trends. Quite early on, however, I began to see films which combined traits of two or more of the movements - Marcel L'Herbier's 1922 Don Juan et Faust, for example, with its touches of Expressionist decor, or Karl Grune's 1923 Die Strasse, which borrows French Impressionist subjective camera effects. Later in the decade, dozens of films were blending these styles. Thus I became interested in tracing the influences and changes among countries as well as within countries. It was while I was researching the possible causes of these influences that I discovered the existence of the Film Europe trend, discussed briefly by Georges Sadoul and very extensively in journals of the 1920s.
As part of this effort at creating a pan-European cinema, industry officials and filmmakers debated the notion of making films with international appeal. There arose a concept of the European or international film - a film whose subject matter and style would be calculated to appeal to audiences across the Continent. It became apparent to me that the blendings of style I had observed in the films might not simply be a matter of personal decisions and influences. Perhaps instead it was partly a result of actual industry policy and an ideological view common within the filmmaking community in the mid-to late 1920s.
Thus the general concept of film Europe became a useful summary term for a whole set of institutions which might have affected film style. It forms the core of my project - which, as I mentioned, is primarily concerned with style change. Here, however, I shall be doing a overview of industrial factors that helped form Film Europe, and especially those which helped destroy it in the 1930s.
There was no question of cooperation among film producing countries in the years immediately after the war. The war had radically altered the balance of control among these countries. France and Italy, which had been forced to cut production back were in a severely weakened position. The USA took advantage of the war to move into markets like South America, Australasia, and the Orient, depriving the Europeans of their biggest sources of foreign revenue. As of 1917, the USA had essentially gained control of most world markets outside Central Europe, the USSR, and the Middle East.
This control was to continue in most areas, of course, but that was not at all clear to people in the film industry at the war's end. American experts speculated nervously in the trade papers as to how to maintain their lead. For a few years it seemed possible to many that one European country or another might cut that lead significantly. France and Italy were possible competitors, but most observers saw Germany as the main contender.
Ironically, Germany had come out of the war with a greatly strengthened industry. Before the war it had exported a negligible amount of film and had in fact been one of America's best foreign customers. But when the government banned the importation of all but Danish films in 1916, the German industry entered a period of isolation. Small film companies proliferated, but the real breakthrough came in late 1917, with the creation of the Universum Film-Aktiengesellschaft (Ufa) by the government and large industrial investors. This marked the entry of big capital into the German film industry, as well as the beginning of vertical integration there. Other large companies were soon formed. The ban on imports continued to the end of 1920, and almost none but German films was released in that country. Such government regulation in support of the film industry would continue throughout the twenties, another factor contributing to Germany's advantage over other European producing nations. The German industry was gearing up to compete on the world market well before the war ended, and German firms moved systematically into neutral countries during and just after the war.
Aside from a general fear of such powerful economic competition, other European nations retained considerable anti-German sentiment as a result of the war. With the American control an accomplished fact and the constant fear of a German "invasion" within film industries in England, France, Italy, and the USA, a highly competitive, uncooperative situation existed in America and Western Europe during the period to about 1921. At that point a slow thaw in relations began, culminating in an almost complete turnaround by 1924, when a spirit of friendly cooperation surfaced among some elements of the European film industry. During this thaw, Western Europe was also beginning to recover from the economic depression of 1921; starting in 1922, most countries made greater progress in rebuilding after the war damage and in moving toward currency stabilization during the mid-1920s.
By 1924, then, the economic situation in Western Europe was less disorganized than it had been just after the war, and there was perhaps less inclination toward cut-throat competition in the film industry. Furthermore, it became increasingly clear that no one producing nation could make serious inroads on the American control of world film markets. Great Britain, France, and Italy had made virtually no progress in that direction. Even Germany, which had managed to hold the largest share of its own domestic market because of its quota system and the trade barrier of inflation, lost the latter advantage during 1923 and 1924, as the mark was stabilized. The American share of the German market rose sharply, from about one quarter of the total in 1923 to one third in 1924; by 1925, American films held 42% of the German market, surpassing the domestic product for the first time in the post-war era. In 1926 that lead strengthened, with the American films at about 45%, to Germany's 36% (these were the years of the German industry's post-stabilization crisis). Although Germany remained the strongest film industry in Europe, its problems were comparable to those of the other countries, and the advantages of economic cooperation against the common enemy were becoming apparent.
The European film experts were well aware of the reasons enabling America to maintain its world control. The USA was by far the largest single film market in the world. In the early 1920s it had around 18,000 theatres; its nearest competitor, England, had around 4,000, Germany about 3,700, and France only about 2,500. Moreover, American theatres were on the average larger; they operated more days of the week, and their patrons were more regular filmgoers. Thus the American firms could afford to spend a great deal more per film, with a guaranteed return from the large domestic market and predictable revenues from abroad. Indeed, in about 1917, most American producers began figuring negative cost on the basis of estimated world, rather than domestic, revenues; the result was a considerable jump in production values just in time to counter possible post-war competition. American films were not only more lavish than those of other nations' producers, but the American exporters could afford to sell these big films relatively cheaply abroad. Other producers, given a limited domestic market and few export opportunities, had to keep budgets low and rentals high to ensure even a small profit.
But members of the European film industry began to realize that by combining their individual markets into one large unit, with films circulating freely and regularly through reciprocal distribution agreements, they would stand a chance at competing with America. With a larger guaranteed export, budgets for their individual films could also be raised, and those films could be sold more cheaply. Such films still might not be able to enter the closed American market easily, but they could compete on more equal terms with the Hollywood product in such important markets as South America and Australia. The creation of a larger base for production was the main goal of the Film Europe idea.
The notion of pan-European cooperation was gaining much currency at this same time. It had been voiced by leftist politicians and writers since the war's end, but during 1922 and 1923 the European idea was becoming more widespread and plausible. The French occupation of the Ruhr made some sort of peaceful solution more vital. In August of 1923, Gustav Stresemann's election as Germany's chancellor made the idea of Franco-German cooperation a real possibility; late that same year he spoke in favour of the idea. With the election in May 1924 of the Edouard Herriot government in France, the idea seemed even more workable, as Herriot had long been an advocate of European economic cooperation. In October of that year he spoke at the Sorbonne in favour of a "United States of Europe". During this same period, there was an increasing number of contracts made among business leaders of France, Germany, Belgium, Luxembourg, and others. Capitalists in various fields had come to realize that the huge American market gave the USA a trading advantage abroad in many areas. European trade had lost its central position in the world during the war, and it had become apparent that it would not regain it using current strategies.
Thus during the 1922-1924 period, the whole of European cooperation was widely debated, in the popular as well as the specialised press; the business community was also beginning to consider it as a strategy. The film industry followed the trend in 1924 with an early attempt at reciprocal distribution agreements between European countries, aimed at building a larger market. During the summer of that year, Ufa signed a mutual distribution agreement with the Etablissements Aubert, one of the major French companies. There had been many distribution contracts signed between companies of different countries during the years after the war. But most such contracts simply appointed one firm as the foreign distribution agent for another, usually stronger, one. The mutual distribution pact was different, in that it signalled a willingness to open markets for a two-way exchange. Moreover, this arrangement was explicitly presented to the public as an attempt to create a European market. French reporters repeatedly interviewed the initiator of the pact, Erich Pommer. As head of Ufa, the single strongest film firm in Europe, Pommer was seen as a potential leader in a new pan-European industry. He summed up the new approach which many industry members hoped would guide the European film in the future:
I think, said Mr. Pommer, that European producers must at last think of establishing a certain cooperation among themselves. It is imperative to create a system of regular trade which will enable the producers to amortise their films rapidly. It is necessary to create "European films", which will no longer be French, English, Italian, or German films; entirely "continental" films, expanding out into all Europe and amortising their enormous costs, can be produced easily.
These same opinions were expressed repeatedly in the trade and popular papers of Europe for the rest of the silent period.
The general idea of "Film Europe" took some time to bear fruit. It came into being shortly before the German industry entered its post-stabilisation crisis. During 1924 and 1925 there was no successful follow-up to the hopeful beginning made by Pommer and Aubert. When Ufa was in financial difficulty in 1925, it was forced to turn to rival American firms to help it with a loan; the result was the famous Parufamet mutual distribution agreement, which guaranteed a number of Paramount and MGM films a place on the German market, as well as committing Paramount and MGM to distribute Ufa films in the USA.
Once the post-stablisation crisis ended in Germany, however, in 1926-1927, the film industry there got back to the serious business of cooperation. Similarly, other European countries were stabilising their currencies and getting past the main period of reconstruction of wartime damage; they were entering into the boom years that would precede the Depression. Over the next two or three years, a few countries did actually manage to chip away at the American hegemony and to increase the circulation of European films. They did this primarily through distribution contracts and quota laws.
As a result of these and other cooperative measures, the American share in Germany fell from about 45% in 1926 to 32% by 1930, while the German share rose from 40% to 50% in those same years. British films, which had been at a negligible .4% in the German market in 1926, went up tenfold to 4% in 1929. The pattern was somewhat the same in Britain and France, although in every case, when American shares fell, the slack was taken up primarily by German films, then by a few British films. France benefitted least from Film Europe, simply having too weak an industry to hold up its end. For example, between 1926 and 1930, the American share of the French market fell from about 79% to 50%. Yet while the French share rose from 10% to 20%, the German share passed it by going from 6 to 23%. Still, all three countries benefitted to some extent.
Given this relative success of the Film Europe efforts in the late 1920s, why did the notion die out in the 1930s? We can attribute the decline to a combination of circumstances.
The Depression was a major cause, of course. The general policy in response to the crisis in many countries was to draw back from international cooperation, and to erect trade barriers to try and improve domestic economies internally, rather than through systematic international policy. This approach was carried through in the film industry. In general, the amount of government regulation of all commerce increased during the 1930s. National industries tried to raise exports and lower imports, all without regard to coordinating efforts with other countries.
This trend was exacerbated by the fact that sound happened to be introduced in Europe just at the time when the effects of the Depression were spreading. While sound had been introduced during the 1926-1928 period in the USA, it did not hit Europe until 1929 - and then only as a tentative beginning. The process of widespread conversion of studios and theatres went on during the early 1930s.
Sound offered various reasons for the leaders of the film industry to move toward increased competition within Europe. For one thing, sound introduced language barriers among countries. This new factor seemed to throw all the ideas about a pan-European market out the window. Before, films could circulate throughout Europe with the simple substitution of different intertitles. Now the process became more difficult. At first, dubbing was not feasible, since it was very crude technically. Subtitles were not popular initially, and it was not clear that they would prove an acceptable solution.
Because of these language difficulties, there was apparently a widespread notion that Europe would break up into small clusters of countries with shared languages. These would be protected from a large influx of imported films made in foreign languages. Sound was thus seen at first as a way of wrenching domestic markets back from American domination. Some industry officials and commentators seem to have hoped that American films would be confined to Great Britain, the Commonwealth, and other English-speaking areas. If this had indeed happened, it would have meant that European producers could amortize their films more easily within their domestic markets and in the few other countries using the same language; they would not have met so much competition within this limited area.
This idea had some currency in France. The editor of La cinematographie francaise wrote in 1930 that sound would be good for the French industry: "Numerous are the territories where the French language is spoken and employed, or where it is utilized as the preferred second language." He listed Belgium, Switzerland, North Africa, Egypt, and the Near East as such markets. He also pointed out that ticket prices in France had risen with the introduction of sound:
The coming of the"talkies" is all for the good of the French industry, for now film production can be covered, with considerable profit, within the country itself, in addition to this which there is a certain sure foreign market. Competition from outside is no longer to be feared.
This writer was overly optimistic. By 1931 , subtitles and dubbing had been improved and began to emerge as the standard ways of dealing with language barriers. American films continued to be a major force on the French market; they made up about 43% of the market in 1932, and they hovered around that range of the mid-forties until about 1935.
By 1935, it was apparent that the French-language market was not large enough to permit competition on equal terms with English-language production. A 1935 report by a French government official pointed out that about 75,000,000 people around the world spoke French, and that there were about 5,000 cinema theatres catering to them. But English-language films had a world-wide audience of about 225,000,000, or three times as many; these people had access to 30,000 cinemas, or six times as many. The report concluded: "To protect the French production against foreign production is not only to defend it, but even and above all to place it once more in a position which would permit it to attack, with equal chances, its international competition, at first on its own market, later on foreign markets." It was the same call that had been issued over and over since the late war period: let's get back the French market, then move into export. The report also called for the poorly organized French film industry to be re-structured. We shall see shortly what the industry was up to in the 1930s.
The huge English-language market mentioned in this report had, I suspect, caused the British industry to shift its tactics as well. English firms had had strong links to German and other continental firms in the late 1920s. Yet they had been largely unsuccessful in sending films into the American market. With the coming of sound, the British industry apparently experienced renewed hope. There was a widespread assumption that with great actors speaking English in adaptations of famous literature or in reconstructions of historical events, British films could appeal to American audiences. The tremendous success of The Private Life of Henry VIII in 1933 seemed to confirm this hope. There was a great deal of financial speculation in film production over the next few years, ending in a disastrous falling-off of production in 1937; indeed, the American firms seem to have had a stronger grip than ever on the British industry by the late 1930s. The British industry's gamble on English-language films as its hope for prosperity turned it away from European cooperation during the 1930s, and toward the USA. There were many foreign filmmakers working for English firms in the 1930s, but they no longer came to participate in British-German co-productions; these were refugees from Germany and various Eastern European nations.
Sound had another major effect on the European industry. In every country, the cost of wiring cinema theatres and studios was quite high. In particular exhibitors were hit with this extra expense in the period 1930 to 1935, exactly as the Depression's effects also reached them. To stay competitive, theatre owners had no choice but to wire their auditoriums, or go under. Hence sound helped to intensify the effects of the Depression within the film industry.
At the same time as the Depression and the conversion to sound were occurring, other equally important changes were taking place within the film industries of various European countries. In general, within most major producing nations, there was some attempt at a consolidation of the structure of the industry. Each country experienced a move toward monopolistic or oligopolistic structures of some sort; some were successful, some not. I will concentrate here on the situation in USSR, Germany, and France.
In the USSR the film industry got a late start after World War I. The government nationalised the industry in 1919, but it was unable to function beyond the simplest level, due to a lack of raw stock, equipment, personnel, capital, and so forth. Shortages of basic equipment were to plague the industry into the thirties and would influence the whole import-export question and the first Five-Year-Plan.
Cooperation from abroad was surprisingly significant to the Soviet film industry. During 1922, the Treaty of Rapallo opened trade relations with Germany. This was a key move, primarily because the German Communist group, the Internationale Arbeitershilfe (IAH) provided a link between the Soviet industry and the western world. This group, whose name means Workers' International Relief, was responsible for financing much of the Soviet film industry during the 1922-1923 period, through credit and the supplying of equipment. It also set up Prometheus, a German-Soviet film company, in Berlin in 1924; Prometheus was a major conduit for getting Soviet films out into the world market through the 1920s. The IAH's investment was also used in the USSR, in the formation of the important Mazhrabpom production company. Mazhrabpom kept up its close links with Prometheus in Germany and was highly successful in producing films for export.
The USSR was certainly never a major participant in the Film Europe movement; the government would hardly have been interested in helping set up a healthy capitalist film industry in a European context. The IAH, however, was interested in using the films it produced in the USSR to promote an international workers' cinema. By its early and continuing links with the German film industry, the Soviet film industry participated in and benefitted from the Film Europe movement in an indirect way. By the late 1920s, Soviet films gained a wide reputation abroad, in part because of the kind of international film circulation fostered by Film Europe.
The Soviet Union participated in the general pattern of trying to consolidate its film industry into a monopolistic structure. It initially tried to create a state monopoly by forming Goskino in late 1922. This company is generally held to have been a failure; it never managed to concentrate distribution and import-export functions, or to eliminate the private firms that had sprung up under the New Economic Policy. By 1924, however, Soviet film production was beginning to recover. Another attempt was made to create a state monopoly for the film industry through the formation of Sovkino at the end of 1924. Its general program included the exportation of films, because foreign currency was needed for the film industry. Foreign films had to be imported as well, because Sovkino needed to distribute them and thus make money to expand the Soviet film industry. The government did not subsidize the film industry in the USSR extensively; instead, it expected the industry to pay for itself. Moreover, the film industry was supposed to expand rapidly, and possibly even someday to become a major source of general revenue for the government. On a practical level, exports were also needed to pay for importation of raw stock and equipment; the Soviet film industry was entirely dependent on such importation for its basic supplies, and the country's small stock of foreign currency could not be used for importation.
Ironically, Sovkino began operating on this export basis in 1925, the same year in which Stalin's policy of "Socialism in one country" was first put forth publicly. His goal was eventual self-sufficiency, but the film industry, as with many other industries of the time, was largely dependent on export and import. Indeed, in the mid-1920s, the Soviet cinema was just beginning to be seen in the West. The year 1926 brought the new Soviet Montage movement dramatically to European and American attention with the release of Eisenstein's Potemkin in Berlin. During that same year, the distribution company Amkino was formed in New York; it would be the outlet for most Soviet films entering the American market during the 1920s and 1930s.
Already by 1926 Sovkino's policies were under attack within the USSR. Such attacks would intensify through the 1920s. Basically, both import and export were seen as dangerous to the Soviet film industry. Western films brought dangerous ideological views to the workers and peasants. They presented bourgeois ideals and also exposed the Soviet citizen to the luxuries of consumer society as portrayed by Hollywood. But, more surprisingly, exports were also seen as ideologically suspect. There was no particular push to spread Communist ideas through cinematic propaganda - in spite of what censors and audiences in the West seem to have suspected, judging from the widespread censorship and outright banning of Soviet films in Western countries. But the Soviet government and film industry had other intentions when they sent films abroad; they basically wanted an inflow of foreign currency. As far as ideology was concerned, the impulse to export was seen as creating more decadent Soviet films. Sovkino was repeatedly accused of ignoring ideological correctness in order to appeal to foreign audiences. Sovkino films were consistently compared with foreign films and found to be too similar: they were not considered entirely fit for domestic audiences.
Thus Sovkino was caught in a complete bind. It had to import and export in order to pay for the build-up of the Soviet industry. But it was attacked by government officials and the press for doing so, while the government continued to withhold significant financial support. This kind of criticism continued in spite of the apparent success of Sovkino. During the 1927-1928 season, Soviet films brought in more revenues on the domestic market than imported films, for the first time.
In December 1927 the first Five-Year Plan was announced; it was applied to the film industry in March, 1928. As in other industries, the call was for the elimination of imports and for self-sufficiency in production. In effect, this meant that the whole notion of cooperation with European film-producing nations was now against official policy. As in other industries, exports were to be used to finance the build-up of the cinema in the USSR, while imports were gradually phased out. We will see this same basic goal taking hold in other countries: to boost exports without a reciprocal willingness to take imports from other European countries. The goals of the Five-Year Plan were not achieved on schedule in the case of the Soviet film. Exports continued with some success during the late twenties and early thirties. But importation was to continue as well, into the mid-1930s.
The Five-Year Plan in film took some time to achieve its goals primarily because the industry was wholly dependent on foreign raw stock and equipment at the time when the Plan started. In order to make the Soviet cinema self-sufficient in these areas, production had to be built up from scratch. One part of the Plan was to avoid the importation of the new sound-film technology. Through government control, the introduction of sound was largely delayed in the USSR until successful domestically-invented systems could be put into use. Production of sound films began in 1930; yet due to a lack of funds and to the very far-flung system of locally-owned rural cinema installations, the wiring for sound proceeded slowly. The Soviet industry was still making silent films into the mid-1930s; thus the silent period persisted there longer than in any other major producing country except Japan. Through such means, however, the goal of self-sufficiency was slowly achieved.
Similarly, the Five-Year Plan demanded that all raw stock for the domestic industry would be produced in Soviet plants. It took several years to build the promised factories, but they opened in late 1931. During 1932 there occurred a complete switchover from 100% imported to 100% domestic raw stock. Hence the Soviets did succeed in providing the material base which had originally delayed the recovery of the entire film industry.
In 1930, the film industry was also restructured in a way which changed its entire operations. First, import and export for all industries in the USSR were controlled through the formation of a series of import-export combines; the one for cinema was Intorgkino, formed in April. Then during May and June, Sovkino was replaced by Soyuzkino, a company controlling the domestic market; it formed a more complete monopoly than had Sovkino, and was vertically integrated to control all segments of the industry. Together, Intorgkino and Soyuzkino changed the policies of Sovkino. Officials at Sovkino had persisted in their orientation toward import in spite of the Five-Year Plan; now imports began to fall more quickly. According to American customs figures for shipments of film into and out of the USA, 1932 marked the first year when the Soviets achieved a trade surplus with the USA. By 1937, virtually no imports were coming into the USSR. Indeed, the American trade publication, the Film Daily Year Book, finally gave up covering the USSR in its annual survey of foreign market; there was simply no hope for American firms dealing with the Soviets.
In 1935, the last separate production company within the USSR, Mazhrabpom, was dissolved into Soyuzkino. Mazhrabpom, as I have mentioned, originated through investments and loans from the German Communist group, the IAH, in the early 1920s. By 1933, the remnant of the IAH had fled the Nazi regime, re-establishing itself in Paris; the Comintern dissolved it in 1935 - hence the disappearance of Mazhrabpom as a separate entity in the USSR. Thus the last vestige of Soviet cooperation with European film interests in the 1920s was eliminated, and a total monopoly organization was achieved within the film industry. We can assume, then, that by the middle of the decade, the USSR had largely achieved its goal of separating its film industry from the rest of the world.
The situation in Germany presents some parallels to that of the USSR, in the sense that the Nazi government eventually nationalised the film industry and capped the process of cartelization by forming one large monopolistic company in 1942. But the earlier circumstances that led up to that culmination were of course quite different from those in the USSR. Germany had been the leader and the strong stabilising force in the Film Europe movement, and it had been the country that had benefitted most from the movement's achievements. Yet, this success made it all the easier for Germany to turn away from cooperative policies and to attempt to dominate its neighbouring markets once the adverse effects of the Depression became apparent. Germany was among the countries hardest hit by the economic crisis, and it has been argued that some effects of the slump occurred there even earlier than in the USA.
The German film industry suffered through deepening crisis in the 1929-1932 period. The introduction of sound meant that costs were rising, and the major producers were competing fiercely among themselves. There did not exist any structure comparable to the relatively peaceful oligopoly within the Hollywood film industry; that oligopoly had established itself in the teens and twenties and functioned without cut-throat competition. In Germany, one the other hand, large firms frequently absorbed smaller ones or drove them out of business. While there were 83 film production companies in existence in 1929, the number had fallen to 49 by 1934. Moreover, many of the smaller companies became contractually linked to the three largest German firms during that period. One of the most powerful firms was Tobis-Klangfilm, which had arisen only with the introduction of sound in 1929. During the early 1930s it was expanding its influence both horizontally and vertically. Of the 49 firms mentioned as existing in 1934, 24 had links to Tobis. Nazi policy consistently favoured this trend toward concentration in the film industry.
During the 1930s, the Nazis fostered a course of consolidation, first toward oligopoly, and later toward monopoly. The few biggest companies, primarily Ufa and Tobis-Klangfilm continued to get bigger, and the many small companies that had typically existed alongside them were gradually eliminated. The nationalisation process began in 1936, with the formation of a government-sponsored company to buy up the existing film companies; this process culminated in 1942 with the formation of the state monopoly, Ufi.
For my purposes here, the main question is, what were the Nazi policies concerning import and export? Even before nationalisation began, government regulation and policy were influential in these areas. For example, in 1933, the government changed the existing system for awarding certificates to films shown domestically. Previously these certificates had only been used to indicate the artistic quality of a film so that it could qualify for tax breaks. Now all films had to have a certificate to be exhibited at all. Some of the categories added over the years were "Politically especially valuable", "Valuable for youth", and "Artistically valuable". This last description was for prestige, many intended primarily for export. For the most part, however, the Nazis favoured strongly nationalistic films. This attitude goes against the Film-Europe spirit of the 1920s, when it was widely assumed that films should appeal to an international audience. For example, on March 23, 1933, Goebbels addressed the film producers' organisation for the first time, informing them of new policies; he stated: "I gain the impression that all present are honestly willing to cooperate. The film can only be re-established on a healthy basis if German nationality is remembered in the industry, and German nature is portrayed by it." This could be interpreted as an anti-Semitic statement, but it also suggests a more general desire to avoid films calculated to appeal to any non-German groups. Similarly, when the new head of the German theatre-owners association gave an address shortly thereafter, he expressed similar sentiments; David Hull describes his speech:
He warned the audience that the "Friedrichstrasse crowd" (a reference to the Berlin street where Jewish producers had their offices) was through for good. Germany did not want to cut herself off from the rest of the world, he said, but German films must be made by Germans who understand the spirit of the German people. All non-Germans in distribution must go.
Again, Hull takes this reference to the "Friedrichstrasse crowd" as directed only against Jewish producers. But it is worth noting that the Friedrichstrasse was also the location of many of the foreign companies' import and export offices. Quite early on, then, nationalism became the explicit policy of the Nazi government, and this would tend to discourage importation.
Film exportation was still necessary to the German industry, however. Germany in general was still dependent on imports of certain raw materials. Yet the country had a very small stock of gold and foreign currency. When the Depression hit Germany, bank runs and unemployment alarmed foreign lenders and investors, and many withdrew their money from the country in mid-1931. Thus exports of manufactured goods were central to the Nazi policy of recovery and expansion. In spite of lowered film imports, therefore, the German industry tried to maintain exports at as high a level as possible. Welch argues that this was one reason for the delay in nationalising the film industry until the second half of the decade. Such a move would have scared away foreign buyers of German films.
Nevertheless, film exports did fall. As of 1929, approximately one third of the cost of an average feature film was paid by export revenues. These revenues declined to a low level by the 1934-1935 season. By this time, they paid only 8% of the industry's income, and went down to 7% by 1938-1939. In spite of attempts at appeasement abroad, there was much resentment of the Nazi regime. Exhibitors in many countries would not want to risk offending their patrons. For example, when Hitler became chancellor, all German films playing in New York theatres were immediately withdrawn - with the significant exception of Madchen in Uniform, which was publicised as an anti-Prussian film and therefore inimical to the new regime. There were also many Jews within film industries abroad, and they refused to deal in German films.
Again, customs figures on imports and exports to and from the USA give an indication of the fortunes of German films abroad. The height of German exporting into the American market was the 1930-1932 period; thereafter there is a steady decline. Similarly, American exports to Germany peaked for the whole interwar period in 1929 and 1930, then fell fairly regularly; there was a considerable drop from 1933 to 1934. As Ufa had its own branch office in New York City during this period, the USA seems a good market from which to judge the decline of German films on world markets in general.
Government protectionism and support did aid the domestic German film industry, at any rate. Moreover, the long-range Nazi policy was of course to take over foreign markets through conquest rather than cooperation. Territorial expansion during 1939 and 1940 created an expanded film market with no competition. Welch states that by the end of 1939, German distributors had a monopoly within an area with about 8,300 theatres - that is, well over double the number of theatres in Germany alone.
Ultimately the effects of the Depression in Germany and the changed policies under the Nazi regime were almost certainly the biggest factors in the decline of the Film Europe movement. The withdrawal of the USSR from participation in the European market would not have made a significant difference by itself, but Germany was the leader of the movement from the start. It probably had the only film industry capable of extending the cooperative policy into the sound era, but that industry moved in an entirely different direction at that point.
The third producing country, France, also showed signs of attempting to develop a film industry organised around larger companies. In this case, the outcome was considerably different from the state monopolies we have seen in Germany and the USSR.
Since World War I, France's film industry had adhered to the general pattern of business in that country. France had lagged behind the more developed industrial countries like the USA, Great Britain, Germany, and Japan; while they were modernising their technology and developing large, vertically-integrated corporations, France clung to an ideal of small, privately-owned businesses. These companies tended not to have the means to modernise, and they were so small that they could not benefit from economies of scale. Many were family businesses and had a small, regular market. Such a situation did not foster competition, and hence the firms had little reason to innovate. In spite of the growth of some large industries during the 1920s, the pattern of small companies lingers into the 1930s.
The film industry was no exception. After the war, there were few companies which were extensively vertically integrated. The relatively large companies had only small theatre chains and were reluctant to undertake production, preferring to distribute independently produced films. This meant that the small production companies had to take most of the financial risks, and throughout the 1920s and 1930s, the bulk of the French production sector was made up of dozens of small firms that made only two or three films before going under. Firms of this type were constantly entering and leaving the market-place. Moreover, there was little organization of any type within the industry. Since the vast majority of theatres and distribution companies were individually owned, their interests were often opposed to those of the producers. The French film industry was not particularly successful at controlling its own market, and it also did very badly in foreign markets. The figures for Britain and Germany are low, and very few French films managed to get released in the USA. Hence producers had a difficult time amortising their films.
Sound did bring a small boost in 1930 and 1931, at least at home and in Germany. This boost was aided by the fact that the Depression hit France somewhat later than other countries, and many in France actually believed that the system of small businesses would protect it from the effects of the economic crisis altogether. Such confidence, combined with hopes for high profits with the sound film led to a higher rate of investment in the film industry of France. During 1929 big companies formed or expanded through merger. This was the year when Tobis-Klangfilm formed a major production subsidiary in France; this subsidiary actually became one of the most successful firms at exporting films from France. (It produced Rene Clair's first four sound films.) 1929 also saw the formation of Gaumont-Franco-Film-Aubert, a merger of three companies; the biggest firm, Pathe, became Pathe-Nathan through a similar merger. The French industry seemed to be moving along a path similar to those of the American firms when they formed the Hollywood oligopoly a decade before.
As a result of this investment and growth, production rose significantly over the next few years. Yet these big companies and other relatively large ones failed to form a successful oligopoly; rather, they practiced cut-throat competition in an attempt to monopolise the industry. A government report in 1936 concluded that the French industry structure of the early 1930s had been weakened by the great contrast between the big, vertically-integrated firms and the large number of small, independent producers: "The large companies committed the error, in the early years of sound, of wanting to enlarge themselves in order to monopolise the French market." The competition was simply too intense; it caused a great number of failures among both types of companies in the mid-1930s. The crisis was worst in 1934, when Gaumont-Franco-Film-Aubert almost went bankrupt; it was saved only by a government loan. Pathe-Nathan did go bankrupt and was broken up. Thus in the second half of the decade, production was almost entirely given over to a host of tiny independent companies, reverting to its situation of an almost total lack of vertical integration. Investment and credit remained low, of course, as a result of the widespread failures.
These problems meant that the French film was still weak abroad. But it did manage to do better in its domestic market, aided by a series of government trade barriers introduced beginning in 1933. Up to this point, the French government had offered little protection against imported films; a weak quota had been set up in the late 1920s, allowing in seven foreign films for each French one released. Even this quota could not be rigidly enforced, since French production did not always meet the demand. In 1933, however, a quota of dubbed features was set for the next year's imports which was raised in later years. This was the first attempt to put a definite number of imports, as opposed to the earlier fixed proportion. Coverage of France in the Film Daily Year Book suggests that this new regulation was the first one actually to hinder American firms dealing in France. Over the next few years the French share of its domestic market slowly grew, while the American and German portions declined. After 1935, the German share fell to virtually nothing. French films continued to be more popular on the domestic market than were American imports. At mid-decade they reached fifty per cent of the French market for the first time since the war. Moreover, after a long decline in box-office receipts since the Depression hit France, receipts there finally rose beginning in 1937, and the crisis eased a bit.
All this suggests that France was more successful on its own than it had been as part of the Film Europe movement - though the change was slow and unspectacular, and the French industry still considered itself to be in crisis in the late 1930s. Cooperation with other countries during the 1920s had benefitted them at the expense of the weaker French industry. In the first half of the 1930s, Germany in particular continued to be important in the French market, and the French companies were remarkably willing to continue their cooperation. Germany kept up a policy of making French-language versions of its films long after other countries had stopped doing so. France continued to enter into co-productions with German firms and sent its best personnel regularly to work in Germany. Thus the remnants of the Film Europe policy continued to benefit German firms at the expense of the French industry.
Finally I should note that the decline of the Film Europe movement paralleled that of the general European idea and the effort to create a federation of European states. After much discussion during the 1920s, this effort came to a head at the Tenth Session of the League of National Assembly in September 1929. There Aristide Briand, France's foreign minister and one of the central proponents of the European idea, proposed a European federation; he was supported by Stresemann and Herriot. There was much debate over the next few years, but it soon became clear that the project was doomed. The rising right wing parties in Germany condemned the move as an "enslavement" of their nation. Stresemann's death on October 3, 1929, and Briand's on March 7, 1932, were severe blows. By the autumn of 1931, the European idea was waning quickly and was soon largely eclipsed - though it never died out completely and helped form the basis for the formations of the Council of Europe and the Common Market after World War II.
In conclusion, I would suggest that the Film Europe movement had primarily short-term, but significant effects. It made many filmmakers known abroad who might otherwise have remained primarily national figures; in this sense it probably paved the way for the assimilation of European emigres into the Hollywood industry in the 1930s and 1940s. The circulation of films provided many influences that enhanced the style of filmmaking world-wide. And ultimately Film Europe may have provided a sort of model for strategies which have been carried out far more thoroughly in recent decades. Today international film festivals, co-productions, the circulation of personnel, and so on are all common strategies for fostering the European cinema. All of them either originated in the 1920s or at least received their first widespread and systematic use during that period.
1. Carl H. Pegg's Evolution of the European Idea, 1914-1932 (Chapel Hill: University of North Carolina Press, 1983) offers a detailed account of this trend.
2. George Sadoul, Histoire generale du cinema, 2nd ed., 5 vols. (Paris:Denoel, 1975), pp. 36-9. The Film Europe debate can be found in virtually any American or European trade paper from 1924 on; a few samples: "Europaische Monroe-Dokrtrin", Lichtbildbuhne 17, 23 (1 March 1924): 9-10; Paul de la Borie, "Le Film Europeen", Cinemagazine 5, 2 (9 Jan 1925); Jean Tedesco, "Tactique Européene," Cinea-Cine pour tous 98 (1 Dec 1927): 9-10.
3. For an account of the American move to domination in world film markets and the Euopean response, see my Exporting Entertainment: America in the World Film Market 1907-1934 (London: BFI, 1985), Chs. 3 and 4.
4. Derek H. Aldcroft, From Versailles to Wall Street 1919-1929 (Berkeley: University of Calif-ornia Press, 1981), pp. 125-149.
5. Die Kinotheater der Erde, Lichtbildbuhne 14, 4 (22 Jan 1921), p. 27.
6. A. George Smith, "English, French and Italian Films will Reduce American Exportation," Moving Picture World, 43, 9 (28 Feb 1920), p. 1423.
7. For one of many statements on this point, see W Wengeroff, "Es darf night gezogt werden!" Lichtbildbuhne 17, 86 (26 July 1924), p. 14.
8. C. de Danilowicz, "Chez Erich Pommer," Cinemagazine, 4, 27 (4 July 1924), p. 11.
9. Thompson, pp. 107-11.
10. P.A. Harle, "1930-France-1931," Film Daily Year Book, 13 (1931), p. 572.
11. Quoted in Franci Courtade, Les Maledictions du cinema francais (Paris: Editions Alain Moreau, 1978), p. 117.
12. For an account of this period in Britain, see Robert Murphy's "A Rival to Hollywood? The British Film Industry in the Thirties," Screen, v. 24, nos. 4/5 (July/October 1983), pp. 96-106.
13. For accounts of the Internationale Arbeitershilfe's film work, see Vance Kepley, Jr., "The Workers' International Relief and the Cinema of the Left 1921-1935," Cinema Journal, v. 23, no. 1 (Fall 1983), pp. 7-23; Denis Hartsough, "Soviet Film Distribution and Exhibition in Germany, 1921-1933," Historical Journal of Film, Radio and Television, v. 5, no. 2 (1985), pp. 131-48; and my "Government Policies and Practical Necessities in the Soviet Cinema of the 1920s," Conference on Soviet Cinema: Image Making and Social Impact, Kennen Institute for Advanced Russian Studies, Washington DC, 18 Sep 1986.
14. Willi Munzenberg, Solidaritat: Zehn Jahre Internationale Arbeitershilfe, 1921-1931 (Berlin: Neuer Deutscher Verlag, 1931), p. 515.
15. Denise Youngblood, Soviet Cinema in the Silent Era, 1918-1935 (Ann Arbor: UMI Research Press, 1985), p. 112.
16. Richard Taylor, The Politics of the Soviet Cinema 1917-1929 (Cambridge: Cambridge University Press, 1979), p. 96; Youngblood, p. 112.
17. Taylor, p. 65.
18. B. Kotiev, "L'organisation cinematographique en U.R.S.S.," in Le Cinema en U.R.S.S., ed. A. Aroseff (Moscow, 1936), p. 215.
19. Based on Annual figures from the Foreign Commerce and Navigation of the United States (Washington, DC: Government Printing Office).
20. Kepley, p. 19.
21. Charles P. Kindleberger, The World in Depression 1929-1939 (Berkeley: University of California Press, 1973), pp. 116-17; R.J. Overy, The Nazi Economic Recovery 1932-1938 (London: Macmillan, 1982), p. 18.
22. David Welch, Propaganda and the German Cinema 1933-1945 (Oxford: Oxford University Press, 1983), p. 20-1.
23. Quoted in David Stewart Hull, Film in the Third Reich (Berkeley: University of California Press, 1969), pp. 18-19.
24. Hull, p. 23.
25. Welch, p. 31.
26. "German Films Get a Setback in City," New York Times (9 May 1933), p. 20.
27. Foreign Commerce and Navigation of the United States.
28. Welch, p. 35.
29. Nathanael Greene, From Versailles to Vichy: The Third French Republic 1919-1940 (Arlington Heights, Illinois: AHM Publishing, 1970), pp. 5-12.
30. Georges Sadoul, French Film (London: The Falcon Press, 1953), p. 56; Richard Abel, French Cinema: The First Wave 1915-1929 (Princeton: Princeton University Press, 1984), pp. 62-3.
31. Quoted in Paul Leglise, Histoire de la politique du cinema francais: Le cinema et la III Republique (Paris: Librairie Generale de la droit et de jurisprudence, 1970), p. 123.
32. Leglise, pp. 107 and 123; Raymonde Borde, "The Golden Age: French Cinema in the 1930s," in Rediscovering French Film, ed. Mary Lea Bandy (New York: The Museum of Modern Art, 1983), pp. 67-69.
33. Thompson, Exporting, pp. 119-21, 211-2; Film Daily Year Book (1929-1938); P.A. Harle, "France During 1937," Film Daily Year Book (1938), p. 1147.
34. Courtade, p. 107.
Html mark-up Tom O'Regan 20.2.96, Garry Gillard 10 February, 2015