Through the 1940s and 1950s, the DoJ went to war on the “studio system” — a system whereby studios locked up actors in exclusive contracts and then bought or strong-armed all the movie theaters in America so that they’d screen whatever the studios made, freezing out independent productions from movie companies that might offer their talent a better, less restrictive deal.
The result was the “Paramount decrees,” a set of rules that, for 70 years, have acted as a check on monopolistic conduct from the increasingly monopolistic film industry, which is now down to four major studios, thanks to the US government’s consent to a merger between Disney and Fox.
Now, in response to “changing market conditions,” the DoJ is set to ask the Southern District of New York to end the rule, just as new streaming services are set to end creators’ access to residual payments for the ongoing use of their compositions, scripts, performances, and other creative endeavors.
The new regime could see mergers with America’s already vastly over-concentrated movie theater industry, which has been sewn up by the Chinese owned AMC and a handful of also-ran competitors. It could also see a return to “block booking” and other practices that let the major studios tie up movie screens, depriving smaller and independent producers of access to audiences.
The DoJ is also set to get rid of up to 1,000 consent decrees, including the ones governing music licensing, giving far more power to ASCAP and BMI.
“The sunset period will allow the defendants and movie theaters a period of transition to adjust to any licensing proposals that seek to change the theater-by-theater and film-by-film licensing structure currently mandated by the decrees,” Delrahim said in a speech to the American Bar Association’s fall antitrust gathering.The consent decrees also barred studios from owning movie theaters without a court’s approval and banned rules setting minimum prices for movies.
Justice Department asks court to scrap decades-old ‘Paramount’ antitrust decrees [Diane Bartz/Reuters]