Edward Jay Epstein

By locking in actors’ salaries, Hollywood studios were able to control the cost of manufacturing their products. Indeed, virtually all their films made money. Since the average cost of producing a film in 1947, including all studio overhead, was only $732,000, and the average net receipts for a studio feature amounted to $1.6 million, filmmaking was a lucrative enterprise for studios.

Subsequently, in 1990, Italian financier Giancarlo Parretti bought MGM for $1.6 billion and told Alan Ladd, Jr., the studio’s head, “You just make the films, I just want to make the actresses.”