The Indicator from Planet Money - The Origin Of The Oscars

It's almost time for The Oscars! We look back at the founding of The Oscars, and how it propelled the American movie industry to the prominence it holds today.

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This is the indicator from Planet Money. I'm Alexi Horwitz Kazi in, for Stacey Vanek Smith, he'll be back next week, and I'm Amanda visiting from Planet, Money Alexi. Nice to see you over here at the end of a long week, and it is a big week is Academy Awards week, the Oscars, but there's kind of a big question looming over the Oscars this year. Like it did for other award ceremonies. Will anybody actually be watching because it's probably not going to be the same, you know, over the top and glamorous Affair that it usually is. So, I didn't even really notice that it was happening. But since you did the story, I think I might watch you going to watch. I don't usually I ate yet. I used to live with people who force me to it to join, a betting pool. That's why I always had money on the line and I basically had to watch but that's kind of out right now. So I still don't know. Right. Right, right now and I haven't movies. I would usually watch it for the red carpet shenanigans that go on, but the Academy Awards are more than just Glitz, and glamour is actually one of the key reasons the movie industry became

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An economic Powerhouse in the first place.

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Today on the show, we are going to travel back in time to hear the origin story of the Academy Awards. How a group of Scrappy Outsiders use the Oscars to take over the American entertainment industry. How history seems to be repeating itself as a new group buys for control of the Silver Screen.

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Love Scrappy, Outsiders a couple of Scrappy Outsiders ourselves.

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Set understand the Oscars shifting role in the entertainment industry, take a trip back to the early days of Hollywood before the film industry. I had a reputation for the glitz and glamour of the red carpet to do that. We call that the Scott eyman, he's a writer and professor of film history at the University of Miami, the men who founded the American movie industry. We're basically Eastern European Jews because no one else wanted it and they didn't see any shame in working in an industry that other people regarded as a peep show. Embarrassment, film was widely seen as a passing fad, buy more established members of the entertainment industry, the guys in the theater and Waterville couldn't be bothered. It was low class. It was demeaning. Do they didn't take it seriously? So it was there for the taking and one of those takers was the man credited with coming up with the Academy Awards guy named Louie, be mayor. Lewis was

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And idealist a pragmatist, a showman he was whatever he needed to be at any given moment. Emigrated from Russia to Canada as a kid in the 1880s. Collecting scrap metal for his father on business and by the time he was in his early 20s, he'd moved to Massachusetts where he used some of that scrap money to help buy a defunct, old burlesque theater, and turn it into a movie theater. Over the next few years, they are learned the ropes, acquiring several more theaters, and he took careful. Note of what kind of movies were drawing? Big audiences. What really made his fortune? He bought the New England rights to The Birth of a Nation. The Birth of a Nation. This is the notoriously racist 1915 DW, Griffith film, which romanticizes the early history of the Ku Klux Klan. It's time screening rights for films were often to go cheated region-by-region. And when mayor heard, it was starting to feel movie theaters, you decided to make a play for the exclusive, right? To screen the movie in his part of the country, it turned out to be a pretty smart business move.

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Besides to profit from this very popular, very racist movie, The Birth of a Nation became one of the first Blockbusters in film history. Because America, mayor Pawn, his wife's jewelry to get the New England rights and under the contract. He was obligated to give Griffith a portion of the proceeds, but he almost certainly underreported throw seat. As one does the birth of Hollywood accounting exactly. The birth of the birth of Show Business and 18 months later, he uses that money to move to LA and he starts making his own movies, Nollywood. I felt about him wanting her at her jewelry to make this first big investment. I suspect she got even more impressive. Exactly. You know, you can always buy more diamonds. You can always get another film. It's going to gross, you know, 10 million dollars in 1915, money, 15 money, West,

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He proceeded to build metro-goldwyn-mayer lion that's inside the gold Circle that would eventually become arguably the most successful movie empire of Hollywood's Golden Age. Kind of a blueprints for the industry but as he was building the studio in the 1920s he faced a couple of major problems first. The whole studio Enterprise depended on keeping the movie stars happy so they would have lodging me. Help the industry to keep cranking out up to 500 movies a year to dealing with egos you're doing is great of temperaments, you're dealing with actors and actresses and acting still wasn't widely seen as a respectable profession. And mayor wanted to find a way to elevate their achievements. Problem number to the threat of organized labor, the introduction of sound into the movies to talkies. Meant there was a huge new demand for writers to script dialogue. And many of those riders came to Hollywood from the East Coast, where unions had a tighter grip by the importing, all this Talent.

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California. It really lit. The fuse for the union movement in the movie industry. So in 1927 mayor and his collaborators come up with the idea for a new organization that would solve both of these problems at once, the Academy of Motion Pictures Arts and Sciences the industry, and its dealings with Nathan unions. And by putting, on an annual award ceremony, it would stroke the egos of the studio Stars, whose Charisma and carefully, manicured public images or what, actually put butts in those theater seats, Morgan industry. Dinner party tickets for just $5. The presentation of the prizes took only 15 minutes and the winners have been revealed months earlier, so there wasn't any envelope tearing suspense when they announced. That Janet Gaynor had won the first best actress award for her performances as Diane and 7th Heaven. And as the wife in Sunrise, classic films are there.

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Was no television. There was no radio there. It was just a bunch of movers and shakers, having a dinner and passing out some awards. But Scott says things changed quickly by the mid-1930s, the award moving broadcast around the country on radio and that was the beginning of its transformation into this. Highly produced self-congratulatory spectacle that we know today, it was as, if suddenly the movie industry, change their brand Tiffany's, the Academy Awards. It was all class. That was tuxedos. It was the respectable people asserting that this is the movie industry. I know and love and work. It was like a movie within a movie hits through the movie about the movies. And that basic formula for the Academy Awards has essentially stuck around since audience, number to continue to grow Peking with some 55 million viewers in 1998, when Titanic won best picture around the same time. Another origin story in the entertainment industry was taking place, couple of tech industry Outsiders were

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Setting their sights on the Glamorous world of Hollywood Netflix may have started as a mail-order DVD service. But over the past decade in has become a juggernaut in the entertainment industry. And unlike the traditional Studio model which depends on getting real physical button to real physical Theatre season, Netflix and its streaming competitors can continuously rake in the cash from subscribers, all around the world from Denver to Dundee, and they have used that enormous pool of money to hire some of the biggest names in filmmaking and blanket Academy voters with campaign advertising. And so far seems to be working for the second year in a row, Netflix garnered more Oscar nominations than any other Studio or streaming platform in Hollywood, like the Studio's before them. They're using the Oscars as a way to Signal their legitimacy to court high-level Talent with the Allure of prestigious Awards. And of course, as a star-studded gilded advertisement for their films. What do you think?

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Originators of the Academy Awards. What would make if they were watching? Whatever is going to happen this year? They wouldn't like the movies. I think they said the business, I would love to be able to talk to them about, okay. How would you compete here? What would you do to compete with Netflix and Amazon?

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The mayor might have sided with the streaming companies in this fight.

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Their strategy to crush the competition under an avalanche of money. That's a page straight out of Mayors Playbook.

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Episode was produced by Brittany Cronin, with help from Josh Newell. It was fact-checked by Sam Tsui and edited by Kate concannon. The indicator is a production of NPR.
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