FACTS IN THE FILM INQUIRY: AMERICAN POWER EXERCISED.

Star (Christchurch), Volume LXVI, Issue 20223, 6 February 1934, Page 6

FACTS IN THE FILM INQUIRY: AMERICAN POWER EXERCISED.

A Sydney Letter.

Exchange Profits and Cricket Tour: Money to the Players or the Board?

(Special to the “Star.") SYDNEY. January 23. For some very obvious reason, the film inquiry has been, as one disgusted newspaper puts it, " driven underground." It has been adjourned for a fortnight, and it has been intimated that in the interval the investigator may receive evidence from witnesses privately. T his is certainly an unsatisfactory method of procedure, and the opinion is gaining ground here that this inquiry is sheer waste of time, and that nothing of value can be elicited unless and until a Royal Commission is set up to secure the production of documents to take evidence on oath.

JN THE MEANTIME some interesting statements have been submitted to Mr Marks. The managing director of Greater Union Theatres, the principal Australian combine, has made a statutory declaration in which he asserts that “ in 1927 and 1928 pressure was brought to bear upon Union Theatres by American film distributors to induce it to raise extra capital and build theatres for the presentation of the pictures belonging to various American film producers. The principal American company insisted that the State Theatres in Melbourne and Sydney should be built, or they themselves would build theatres of equal importance and where they would place their pictures.” This is an interesting sidelight on the origin of the Australian combine. which was thus formed, according to Mr Doyle, through direct pressure from the Americans. An investment company was set up, and in it Union Theatres invested about £850,000 —£500,000 being in cash— and at the same time the Capitol Theatre was built in Sydney. Merger Forced by Bank. Thus, says Mr Doyle, the principal construction activities of Union Theatres were created at the request of, and virtually under threats from, certain American film distributors, to find an outlet for their pictures. In this way Union Theatres were forced to increase its capital from £BOO,OOO to £2,600,000. Then came the depression, and in 1931 Union Theatres were forced into liquidation. Greater Union Theatres was formed, financed by the E.S. and A.; and as this bank was also carrying Hoyt’s it desired the two concerns to merge. Thus was created General Theatres Corporation, which controls the greater part of Australia’s picture business. Mr Doyle went on to explain that his corporation has available about 670,000 seats weekly for the general public, but only about 30 per cent of these are occupied, and this he regards as proof that no new theatres are required. He shows also that last year’s gross receipts of General Theatres were about £1,200,000; of this the film distributors received 25 per cent or £300,000; while, after all necessary disbursements, G.T.C. could show a net profit of only £SOO for the twelve months. Mr Doyle further submits that the 4430 Australian shareholders who have invested their money in G.T.C. deserve consideration; that their shares in many cases represent their life savings; and that “ if new theatres were built it would spell ruin to them.” He also touched upon the necessity for “ a purely Australian outlook ” in such matters, and urged that “ it would be a sorry day for Australia if the public sentiment of the country, by virtue of the foreign moving pictures presented, was dictated by foreigners.” Mr Doyle therefore advocates legislation to empower the Chief Secretary to withhold further building licenses, and “ the appointment of a permanent board to regulate the industry.” Heavy Loss Feared. As regards the probable effects of American competition, Mr Munro, managing director of Hoyt’s Theatres, corroborates Mr Doyle’s views, maintains that “ the result of further theatre building would be

the certain closing of some theatres and heavy financial loss to exhibiting companies, and describes the threat of certain American distributors to build in Australia as “ an instrument whereby they may extract a greater and overwhelming share of and control on Australia's motion picture business. Putting the case even more strongly, Mr F. J. Smith, another G.T.C. director, holds that the money sunk by Australians in Greater Union and Hoyt’s Theatres — amounting to nearly £5,000,000 in all—will be “ totally lost,” if the Metro-Goldwyn-Mayer Company is permitted to carry out its threat of building theatres for its own pictures here. These are ex parte statements, but they are in a sense authoritative and they have at least given Mr Marks a great deal to reflect upon before the inquiry reopens next month. The Cricket Tour. The Board of Control has no very pleasant job at the best of times, and members would be therefore well advised, in making their arrangements for the forthcoming tour, to avoid all unnecessary trouble. In spite of this the Board has put forward a proposal which, to put it mildly, is open to criticism on the score of justice—to say nothing of generosity. The allowance to be received by the sixteen members of the Australian team is £6OO per man. The Board, it seems, intends to advance £IOO per man for preliminary expenses and to keep £l5O for each man till his return. The balance—£3so per man—will be paid, is so required, in instalments of about £BO per month; and this sum will of course be paid in English money at Home. But the Board proposes to pay the preliminary £IOO, and the final £l5O in Australian money, and by so doing, it will make, at the current rate of exchange, about £62 per man, or about £llOO profit on the w’hole transaction. Now, in the first place, it is not clear why so large a sum as £IOO should be advanced in Australian money for preliminary expenses, for on some previous tours, when exchange was at par, the advance has been £SO, this being optional. Profits of the Tour. But, more than this, it is argued with great force by Arthur Mailey, who has taken up the matter publicly, that as the money is earned in England, the players ought to receive whatever benefit accrues there from the favourable rate of exchange. If there is any advantage to be gained by utilising the difference in rates, why should the board benefit by it and not the players? A moderate estimate of the profit which the board will ultimately make out of the tour is £20,000 in English money, which will be equivalent to £25,000 in Australian money. As the board will make a clear profit of £SOOO on this deal, it does not seem fair that the board should also secure for itself an exchange profit on the moneys due to the players. This little matter will not be allowed to rest, and the board, before it enters into the inevitable controversy over player-writers and other vexed questions, wiil do well to make the concession suggested by Mailey and to give the players the full benefit of the exchange.