On November 22, 2019, the Department of Justice filed to formally terminate the Paramount Decree, the landmark 1948 antitrust decision that ended vertical integration in Hollywood and sought to prevent the monopolization of the film industry. This process of de jure rescinding decrees seemed inexorable given the de facto erosion of them by streaming. Stopping vertical integration ended the delivery of Hollywood's industrial product (films) from being sold direct-to-consumers (à la company-owned theaters) or by studios only selling to independent exhibitors through block booking, a practice where A-features would be packaged with B-movies. That system was going to go through a crisis regardless of the result of U.S. v. Paramount, given that TV was going to fundamentally alter distribution, profit avenues, and audience tendencies.
While Netflix couldn’t own a movie theater, they could have their own means of direct distribution through their streaming service. This possibility plus the formal repeal of the Decrees meant that Hollywood was up for direct sales, both with what they produce and themselves as a product, ready-made for the biggest investor with the best possibility of growth (even if, on the human scale, it means the loss of jobs—growth is about money, not people).
We’re in an age of monopolies. Everyone’s seen the infographics of the dozen or so companies that own all the other ones, and news is accelerating of CBS-Viacom mergers, 20th Century getting absorbed into Disney, and Warner Bros-Discovery getting bought out by Netflix for $82.7 billion. The Paramount Decrees have been stopgaps towards this age, but a dam isn’t a historic necessity, but a river’s an environmental inevitability. The currents of a capitalist determinism can be pushed back against, but one can’t forget they are part of its nature.
One of the main projects in Marx’s economic criticism was explicating how capitalism as a system necessarily moves itself towards this monopolization. In the wake of the WB-Netflix merger, one of the hosts of the Cold War Cinema podcast shared this passage from the first chapter of Lenin’s Imperialism, the Highest Stage of Capitalism, which is worth quoting at length:
“Half a century ago, when Marx was writing Capital, free competition appeared to the overwhelming majority of economists to be a ‘natural law’. Official science tried, by a conspiracy of silence, to kill the works of Marx, who by a theoretical and historical analysis of capitalism had proved that free competition gives rise to the concentration of production, which, in turn, at a certain stage of development, leads to monopoly. Today, monopoly has become a fact. Economists are writing mountains of books in which they describe the diverse manifestations of monopoly, and continue to declare in chorus that ‘Marxism is refuted.’ But facts are stubborn things, as the English proverb says, and they have to be reckoned with, whether we like it or not. The facts show that differences between capitalist countries, e.g., in the matter of protection or free trade, only give rise to insignificant variations in the form of monopolies or in the moment of their appearance; and that the rise of monopolies, as the result of the concentration of production, is a general and fundamental law of the present stage of development of capitalism.”
The refutations of Marxist critiques of capitalism have been proven hollow as the history of capitalism has shown only more consolidation. Lenin argues that “The enormous growth of industry and the remarkably rapid concentration of production in ever-larger enterprises are one of the most characteristic features of capitalism.” Going further, Lenin writes that “Competition becomes transformed into monopoly. The result is immense progress in the socialisation of production… this means that the development of capitalism has arrived at a stage when, although commodity production still ‘reigns’ and continues to be regarded as the basis of economic life, it has in reality been undermined and the bulk of the profits go to the ‘geniuses’ of financial manipulation. At the basis of these manipulations and swindles lies socialised production; but the immense progress of mankind, which achieved this socialisation, goes to benefit… the speculators.”
While there’s a limit on how much we can draw a comparison between the critiques of capitalism by a socialist revolutionary from over 100 years ago in a mostly agrarian society (itself based on the work of an economist from the height of the Industrial Revolution decades earlier), this issue of speculation is prescient. Just as Nixon taking the dollar off the gold standard opened the door to extraordinary “value” as banks were basically given the ability to create federal currency out of thin air by having loans backed on nothing more than institutional trust, so too does the financialization of all other markets—housing, transportation, entertainment—create unprecedented new levels of value out of increasingly poor and wrung-out products. Banks don’t deal in physical currency anymore, and real estate is more about perceived resell prices than it is physical places.
Netflix isn’t a company that needs to be conventionally profitable. It’s a hub for content and a method of its delivery which leads to the perception that it’s worth money which raises its valuations and stock prices and in turn gives it the ability to purchase and acquire more pieces of entertainment content—or companies which produce that content—which raises the value, and the cycle goes on. It’s not so much a question of if a company will grow to dominate the entertainment market, or even all aspects of the overarching market, but which one it will be. Netflix, right now, is the snowball with the most momentum rolling down the hill. Unless the actual form that governs the world (capitalism) changes, everything will ultimately be a footnote until that total dominance is the case.
In the meantime—on the immediate, human scale—what Netflix does to assert its market dominance is threaten those traditional means of exhibition that were kept competitive because of the Paramount Decrees: movie theaters. Netflix is unique in its war against theaters, limiting their theatrical windows to the bare minimum for Oscar-eligibility, and shows little interest in programming their works outside of their dedicated (vertically integrated) theater in New York.
People (older people, in particular) are staying home more than ever while younger and younger audiences at repertory screenings imply a yearning for the space of the cinema. One could argue this desire for a physical, communal space with which to experience art together is a reaction to the loneliness of digital spaces that was exacerbated—especially for young people—by the pandemic. Netflix doesn’t ignore movie theaters because there’s no money to be made there, they do it because that path is the one to making the most money possible. Like how films owned by 20th Century were pulled from the repertory circuit when Disney bought them, it’s likely that Warner’s archive, too, will be vaulted by Netflix, with both showings and physical releases of the movies drying up because Netflix can make more by having that content exclusively controlled by their platform which everyone will have to pay whatever they say to access. They’re not in the business of selling entertainment, but, like Black Rock does with housing, denying access to it.
There are decades of discussions of medium specificity regarding the cinema as a space and how that is or isn’t totally tethered to cinema as a medium, which is going to go into further crisis as theaters start disappearing more and more. This is an extension of Martin Scorsese’s critiques against the “theme park cinema” created by the likes of Disney and Marvel as they push to further content-ize the medium, which itself is part of the larger shifts that exist all across the market which turns everything into a financialized asset.
It’s all about real estate—every McDonald’s and Wendy’s and Taco Bell all look the same now because the value of that location is worth more than what the franchises ever could hope to make in terms of profitability, so they have to be ready to be bought and sold and traded like another piece of stock. Cinemas as a commercial real estate item are interesting because the large-scale multiplexes can’t really be converted into anything else (at least not that’s apparent to me), so either they’ll be torn down or theaters will need to remain a profitable venture that can be swapped around by Regal and AMC. Netflix is doing its best to make sure they won’t be in the future, and the prospects for mom-and-pop theaters are equally as grim given that large studios like Disney already strongarm theaters on how long to program and how to schedule their films—if you don’t comply, the big movies aren’t going to play, and you’re gonna go out of business.
Alarmists in this case are probably correct, given that Netflix is trying to accelerate market trends in its favor and strangle anything it sees as in its way like it did with video store chains. However, Baltimore has Beyond Video, a local non-profit run shop that’s been going steady since before Covid and hosts tens of thousands of titles and can serve as a model for community-based shops that thrive outside of financialization. Film exhibition on a large scale is being gunned down in the streets by the streaming mafia, and it’s time to move the small scale back underground, or at least away from notions of profitability. The legality of screening rights are complicated, and companies like Netflix are going to make it as prohibitively expensive to show the movies in their collections as possible.
In a 2023 interview with Sabzian, Pedro Costa said that film “is not an industry, it was an industry, in Hollywood, in the ’30s, ’40s, ’50s—and then it was over. Now it exists here and there, a little bit, but they are groceries, run by grocers.” It’s a hard pill to swallow for many aspiring filmmakers, but so was the death of the old studio system in the 1960s, which in turn gave birth to New Hollywood. People will keep making images so long as they have the technological means to. That doesn’t seem to be going anywhere. The bigger concern is that issue of exhibition and the physical spaces for it, that’s what could become nothing more than a memory of a bygone era where crowds of strangers gathered together. If people are willing to show up and create those spaces for themselves in spite of corporate pushback, then at least a remnant of the medium as we know it can stay alive.
Another quote that has been making rounds lately is Jean-Marie Straub saying that “cinema will only begin when the film industry is dead.” This, I hope, is true.