Entrepreneurship and the Auteur Theory

6 July 2012 at 1:44 pm Peter G. Klein 9 comments

| Peter Klein |

I’ve been reading Jack Mathews’ The Battle of Brazil: Terry Gilliam v. Universal Pictures in the Fight to the Final Cut, a fascinating — if absurdly one-sided — look at director Terry Gilliam’s struggle to get his 1985 film Brazil distributed in the US. Mathews tells the story as a noble crusade by a brilliant, iconoclastic, visionary filmmaker against the evil studio system, run by corporate toadies who care only about making money, even if it means destroying the artistic unity of the filmmaker’s creative vision. Gilliam had “final cut” rights for a version released in Europe, but his US distributor, Universal, demanded substantial edits, which Gilliam refused to make. Universal, led by Sid Sheinberg (who comes across heroically in documentaries about Steven Spielberg’s Jaws), was completely within its contractual rights to insist on these changes, but the result was a very different film that has been lampooned by critics. (The Sheinberg version was canned and an alternate Gilliam version eventually shown in the US after a long, ugly, public battle between Gilliam and the studio.)

It’s great reading for those interested in movies and the business of making movies. But there’s an interesting entrepreneurship angle as well. Most film critics, including author Mathews, accept the auteur theory of cinema, which sees movies as the highly personal products of a director’s creative vision. The studio approach, which treats moviemaking as a collaborative enterprise designed to make money, is anathema to the auteurs. The case is usually made with familiar anecdotes: 24-year-old Orson Welles had final control over Citizen Kane and created one of the medium’s great masterpieces, while RKO destroyed the follow-up Magnificent Ambersons (and all Welles’s subsequent films). The studios thought Star Wars would flop, and after George Lucas made his zillions he decided to finance and produce his subsequent films on his own, without studio interference — the dream of every auteur. American art-house darlings like Robert Altman, Peter Bogdonavich, Quentin Tarantino, Jim Jarmusch, etc. are always portrayed as fighting to keep Hollywood from turning their edgy, original films into bland, corporate drivel pitched at suburban soccer moms.

As Paul Cantor and others have explained, however, the auteur theory is bunk. Moviemaking is, in fact, a collaborative venture, and many of the best films are studio pictures created by large teams — the best example being Casablanca, which was essentially written by committee. Or, as Cantor puts it: “Just three words: Francis Ford Coppola.” (The Godfather films were studio pictures; virtually everything Coppola did since, with the partial exception of Apocalypse Now, has been a disaster.) And take George Lucas: Does anybody think the problem with the prequel trilogy was too many people standing around saying, “George, you can’t do that”?

Consider the parallels with entrepreneurship. The typical narrative pits the visionary entrepreneur against the establishment — incumbent firms, banks, family members, etc. — who tell the entrepreneur it can’t be done. (Think Fred Smith’s legendary college term paper, Ken Olsen’s supposed dismissal of the PC, etc.) As with cinema, we have lots of examples. But think of the selection bias; what about all the radical innovations that would have flopped had they not been wisely rejected by the corporate office, bank, or VC? We accuse these idea filters of frequent Type I error but rarely worry about Type II error.

Much of the entrepreneurship literature treats funders the way the auteur theory treats movie studios and their corporate owners. Their job is to provide whatever resources the auteur-entrepreneur demands, then get out of the way. They shouldn’t have any residual control rights. They don’t understand the creative vision. They care only about short-term profits. Etc. But, of course, without funders, movies wouldn’t get made, and entrepreneurial ideas would remain just that — ideas. All creative ideas require resources, and resource providers are an integral part of the creative process, whether in art or in business.

NB: for more on the parallels between entrepreneurship and the creative arts, don’t miss the upcoming Cultural Bricolage conference here at the University of Missouri.

Entry filed under: - Klein -, Business/Economic History, Entrepreneurship, Myths and Realities.

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9 Comments Add your own

1. mikemarotta | 6 July 2012 at 6:18 pm

In The Anti-Capitalist Mentality, von Mises makes two complementary claims. (1) Intellectuals dislike the market because they resent the fact that popular writers who pander to the masses earn more money than they do. (2) Popular writers pander to the masses by denigrating the upper class. Think of Agatha Christie.

Complementing Mises is von Hayek for whom “human action” was not a neat bundle of behaviors, but an unpredictable amalgam of coincidences.

No artist works alone: everyone buys “paint” and “canvas.” Whether that is one tube and one roll or the hiring of 100 teams of experts is a matter of context, and the outcomes may remain forever unpredictable in advance, though explicable in retrospect.
2. Rafe Champion | 6 July 2012 at 11:26 pm

The Big Sleep has some of the best film dialogue of all time according to my advisor on movies. Raymond Chandler wrote the book and three others did the script, William Faulkner, Leigh Brackett, and Jules Furthman.

http://en.wikipedia.org/wiki/The_Big_Sleep_(1946_film)

Faulkner won a Nobel Prize for literature, presumably based on his novels of life in the Deep South.
3. fazsha | 8 July 2012 at 6:17 am

No less than Cary Grant, in given his honorary Oscar, accepted by saying “ours is a collaborative medium; we all need each other. “
4. Peter Klein | 8 July 2012 at 11:55 pm

I hasten to add, in response to a private query, that I’m a big fan of Brazil and didn’t mean to suggest that the Sheinberg version is better than Gilliam’s. Whether studio interference improves the film depends on the specific case. But I do think Gilliam acted like a spoiled brat during the conflict over Brazil, assuming that his idiosyncratic preferences should automatically take precedence over those of his partners, even when he had signed a contract to the contrary. A movie does not “belong” to the director; residual control and income rights are determined by contract, and are typically shared among various input providers. Gilliam should have been willing to negotiate.

BTW one “forgotten man” in these stories is the film studio’s shareholders. Universal in the 1980s was owned by MCA. Keep in mind that auteurs like Giliiam are usually very rich men, while the typical shareholder of a firm like MCA is a mom-and-pop type. If you want to root for the little guy, it isn’t someone like Terry Gilliam, it’s MCA’s Joe Shareholder.
5. mikemarotta | 10 July 2012 at 8:19 pm

Then, there is everyone’s favorite capitalist, Michael Moore. United Artists was founded by artists (actors, and others) who wanted more than they got from the studios then. The market allows that. Also, true enough, we might question whether the director is the (only) true artist in the effort and whether and to what extent investors deserve special prizes for being cogent. Monetary gain alone is supposed to be enough, but, really, should those investors not take a bow?
6. Peter St. Onge (@ptrstonge) | 12 July 2012 at 8:22 am

I wonder if there’s a political angle here; the genius function seems easier for gov’t to replicate (e.g. X-prize) than the cooperative or emergent process.
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8. Jim Rose | 20 July 2012 at 8:02 am

It is a lapse to suggest that the film industry is different or that artists get away with more agency slack just because they are artists. Remember Alchian and market selection.

Realized profits, not maximum profits, are the mark of success and viability in any market. It does not matter through what process of reasoning or motivation such success was achieved.

Realised profit is the criterion by which the market process selects survivors: those who realize positive profits survive; those who suffer losses disappear.

Positive profits accrue to those who are better than their competitors, even if the participants are ignorant, intelligent, skilful, etc. these lesser rivals will exhaust their retained earnings and fail to attract further investor support.

As in a race, the prize goes to the relatively fastest ‘even if all the competitors loaf.’ the relatively fastest will be profit maximizers, and so, selection will lead to the survival only of profit maximizing firms.

It is right to say that much of film entrepreneurship sees their job is to provide whatever resources the auteur-entrepreneur demands, then get out of the way.

Many industries run on a separation of the decision making and risk bearing functions. The form of organization that survives in any field is the form that currently delivers the product that is demanded by customers at the lowest price while covering costs.
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