The first Indian cinema theatre chain was owned by the Calcutta entrepreneur Jamshedji Framji Madan, who

oversaw production of
10 films annually and distributed them throughout the Indian subcontinent. During the early twentieth century cinema gained
popularity across India's population and its many economic sections. Tickets were made affordable to the common man at a low
price and for the financially capable additional comforts came with higher ticket price. Audiences rushed to cinema halls as this
affordable medium of entertainment was available for as low as an anna (4 paisa) in Bombay, which eventually developed into the
primary base for the early film industry.

The economic base in Bombay allowed for film technology to take hold and grow as capital from other industrial and commercial
activity supported filmmaking. Bombay also had the artistic base being the center of the Parsi theatre, a commercial theatre
movement originating in the mid nineteenth century sponsored by the Parsi traders who were the dominant business community in
the Bombay presidency.

Thus Parsi theatre group provided the initial pool of performers and writers as nearly all of them switched to film. Parsi capital
supported the film industry essentially throughout the entire silent era into the 1930's. [5]

It is important to note that although Indian cinema was very distinct throughout its early years, and had the fairly popular
mythologicals; about 90% of the films screened in India were from abroad until the 1920's. [6] As the industry grew and the number of
movie goers steadily increased, the content of Indian cinema was increasingly tailored to appeal to these growing audiences.
Elements of India's social life and culture were incorporated into cinema as young Indian producers moved into the industry. Native
Indians who had traveled and foreign producers brought with them ideas from across the world. This was also the time when global
markets became aware of India's film industry. By the mid-1920's, India was producing over a hundred feature films annually, more
than England, France, or the U.S.S.R. [7] The increased profitability of the cinema enabled filmmakers to reinvest their profits in new
productions and additional infrastructure such as studios, laboratories, theaters, and by 1925 Bombay had already become India's
cinema capital.[8] By the early 1930's the film industry was competing with the textile industry as the most important local industry in
Bombay, bypassing it soon after with over 60 percent of India's film production units in the 1930's located in the city. [9] Indian
producers sought to imitate the Hollywood studio system, yet could not achieve vertical integration. [10] The coming of sound brought
further fragmentation to the industry, which broke the national audience into language groups.

The studios' apparent dominance of filmmaking in the decade of the thirties has been attributed to a number of
factors. In the first place the introduction of sound in 1931 created conditions that favoured an integrated, securely
capitalized film industry. In addition the filmmakers who sought to establish an industry along rational economic
lines were well aware of Hollywood and took it as their model for future development.(2) At the same time as these
events occurred within the industry India was undergoing major changes in its social and political composition. The
international depression had had a devestating effect on the rural economy of India with the consequence of creating
a massive pool of unemployed who drifted to the burgeoning urban areas and in many respects constituted a new
audience for Indian-produced films which required a more systematic mode of production if the demand was to be
met.(3) In the political sphere Gandhi's campaign to achieve independence from the British had entered a new phase.
The British resolve to maintain control of India had also changed, and while they always retained a strong repressive
set of apparatuses, their strategy revolved around the establishment of an number of alignments with key communal
and political groups.(4) All of these factors impinged upon the development of the Indian film industry, in particular
the development of the studios. It could be said that the studio system in India arose out of a particular conjunction
of events that reflect a particular stage in the development of capital formation in India.

Major accounts of the development of the studios in India have emphasised three different but related reasons for
their emergence and then domination of the Indian film industry.(5) Firstly, the studios were a response to the
introduction of sound insofar as the introduction of sound technology required substantial injections of capital to re-
equip the industry which brought about a change in the industrial practices associated with film production so that
the full benefits of the new equipment could be obtained.(6) A second account argues that the studios emerged
because the filmmakers themselves sought to emulate Hollywood in their production methods.(7) The filmmakers
sought to institute a particular economic model that would permit them to control all aspects of the film industry in
the same manner as Paramount or one of the other big American production houses. This meant that production,
distribution and exhibition would all operate from the same base. The third explanation suggests that the move
towards a studio-based system of film production reflects the changing forces in the Indian social formation.(8) Each
of these accounts has two features in common. Firstly, they all circle around the role of capital in a changing
economic, social and political situation that obtained in India in the inter-war period, but without ever really
investigating what type of capital was involved. Secondly, they have all focussed on three studios as exemplary
organisations to make their analyses. These are B.N. Sircar's New Theatres Ltd. in Calcutta (established in 1930),
Himansu Rai's Bombay Talkies (1934) in Bombay, and Prabhat (1929) in Poona.(9)

The problem with this sort of analysis is that we do not know what criteria have been used to determine their status.
For example, Devaki Rani, Rai's wife assumed control of Bombay Talkies upon his death in 1941. She has claimed
that Bombay Talkies concentrated on making three good movies a year rather than turning out a series of pot-
boilers.(10) In contrast Ranjit Film Company, Chandulal Shah's unit, was producing up to twelve films a year.
Moreover Prabhat, which was in reality a regional producer, turned out films that had a direct appeal to a specific
fragment of a vast audience, the Marathi speaking intellectuals of Poona who had a tradition of appropriating
popular forms for political purposes in the struggle against the British.(11) Consequently when looking at the
reasons given for the rise and fall of the studios in the Indian film industry we are never too sure what it is we are
discussing.

In one sense it can be claimed that the studio system had its genesis in the activities of the first major figure to
emerge in the Indian film industry. D.G. Phalke (1870-1944). Phalke established his Hindustani Film Company at
Nasik, a small city to the north-east of Bombay. It had all of the trappings of a proto-studio. All pre- and post-
production activity was conducted at the one location. Furthermore, Phalke established an ensemble of actors and
technicians who worked on most of his productions.(15) However, this did not represent a stake in the development
of the studio era in India. What Phalke developed was a variation of the Hindu joint family with himself as the
patriarch.(16) Phalke was responsible for all aspects of the filmmaking process and there is little evidence of him
developing any sense of continuity or of any of the people who worked for him going on to develop their own
companies or products.(17) Because of its indigeous roots Phalke's solution to filmmaking tends to be much admired
in India although it contributed little to the eventual directions the industry took.(18) In the studio era a certain
amount of rhetoric was employed to suggest that the studios operated as families(19) but in fact they were
commercial concerns with salaried employees, including the actors, with a clear demarcation of labour within the
workforce.(20) What is significant about Phalke's operations was his method of financing his project.

After some initial attempts to fund his activities through personal funds that did not succeed, including the pawning
of his wife's jewellry,(21) Phalke was forced to turn to the market place for finance. He turned to the Bombay
commercial classes who had made their fortune in cotton brokerage and who had both economic and political
ambition.(22) The relationship between Phalke and his backers was not smooth. Eventually they withdrew their
support from him because they judged that film making was not going to be profitable during World War 1 because
of a predicted shortage of materials which had been almost exclusively imported from Germany.(23) The significant
point here is that Phalke initiated a set of financial practices for film production that dominated the industry in its
first decade. These were the seeking of funds from traditional Indian money markets using the film as collateral
coupled with a lack of attention to the distribution and exhibition side of the film industry. In many respects the
emergence of the studios was a deliberate reaction among a number of young filmmakers to this situation. In short
they wished to be in control of their own destiny.(24)
It is important to remember that the Indian film industry developed against a mosaic of events which on the surface
appeared to have little bearing upon it at all. These included the political struggle for independence from the British,
a changing economy that was being pulled more and more into a world economy(25) and a changing demography.
Other factors more directly related to the industry also began to emerge in the early 1920s. These included the fact
that Hollywood dominated the Indian screen up to and including the 1930s. Thus the Indian filmmaker found
himself competing against an international product that was supported by resources quite beyond his reach. The
Indian response was to seek government protection for their product. Despite the recommendations of the 1927-28
Indian Cinematograph Committee of Inquiry(26) this was not forthcoming. The British did not classify filmmaking
as a "nation building" industry and thus it did not qualify for government support. At the same time the British
continued to recognise the ideological power of the cinema through the administration of an extensive censorship
apparatus. The relationship between the British and the Indian film industry was always ambiguous. Privately the
British did not trust the medium of film. It had no cultural weight, a factor compounded by the dominance of
Hollywood which provided an outlet for incipient anti-Americanism.(27) Moreover they did not approve of the
social class of the majority of the Bombay film producers.(28) To govern India the British had had to classify the
Indians according to their degree of usefulness to the imperial design or their degreee of complicity with British rule.
The film industry originally drew its personnel from two principal sources. The entrepreneurial and management
sectors came from either the Gujerati commercial classes or the Parsis, and the technical staff and actors came from
the so-called lower classes. Neither group appeared high in the British pantheon of Indian castes. It took the
appearance of the Brahmin actress Durga Khote, an actress in V. Shantaram's Ayodhyecha Raja(1932) to effect
some change in attitudes towards the cinema. This was regarded as a major step in conferring a degree of social and
cultural legitimacy on the cinema that had hitherto been lacking.(29)

Two other significant factors in the emergence of the studios in the early 1930s are the lack of theatres for exhibition
and the primitive distribution network. In 1918 J.F. Madan, the Parsi pioneer of cinema in Calcutta, claimed to
control over one third of the 300 cinemas in India.(30) Madan had contracts for the supply of films with both British
and American companies which guaranteed his supply, which was something no Indian producer could do at this
stage.(31) Madan had located most of his cinemas in either the cantonments, or military areas, and the civil lines
(areas set aside for British and senior Indian civilian administrators) of the major British dominated urban centres.
His audience was generally comprised of British officials, British troops and Anglophile Indian elites. However,
when it became apparent that Indian films could be profitable Madan also turned to production and imported Italian
talent to establish this aspect of his enterprises.(32) In other words Madan foreshadowed the drive towards the
formation of studios as the dominant force in Indian film production. His success led to complaints of monopoly
practice especially from the Bombay producers who claimed their films were excluded from an all India distribution
because of Madan's domination of exhibition, his links with the overseas companies and his move into production
itself.(33) The British took these complaints seriously enough to have the 1927-28 Committee of Inquiry investigate
their validity in camera.(34) The claims were dismissed as unfounded. However, the Committee assisted the
Bombay producers in an informal way. The Universal Picture Company representative for South Asia, George
Mooser gave extensive evidence to the Committee. He pointed out that in fact India accounted around 2% of
Hollywood's overseas earnings and was not regarded as a major or even significant market. Moreover, he analysed
the condition of the local industry for the committee. He made the usual observations about the primitive techniques
employed, the poor standards of acting and scenarios, and the general poor standards found in Indian films. His
major advice, however, was institutional. He strongly recommended that an infrastructure similar to that found in
Hollywood be established. Furthermore he stressed the need for strong, well organised distribution networks.(35) It
is clear that his advice was listened to closely by the members of the Bombay production community such as
Ardeshir M. Irani, Chunilal Munim, Nanabhai Desai and R.C.N. Barucha, all of whom attended the Committee's
proceedings and gave evidence, but more significantly went on to assume powerful positions within the Bombay
industry in the "heyday of the studios".(36)

The move to establish studios on a secure footing in both Bombay and Calcutta represents an attempt to overcome
the problems outlined above. At the heart of this drive was the desire to link the film industry to modern capital.
Like most areas in British India indigenous capitalist forms existed alongside introduced forms. Since the days of
Phalke filmmkers had had to resort to the indigenous money markets to raise capital where money was readily
avialable but at very high interest rates.(37) Furthermore the joint stock banks had persistently ignored the industry's
requests for loans because of a perceived lack of collateral and security on the part of the industry.(38) The banks
tended to support the "national building" industries rather than entertainment. The reliance of the industry upon
traditional capital which tended to charge higher interest rates, led to a situation of serious undercapitalisation in the
industry. The establishment of the studios represented a desire to remedy this situation through a process of
modernity which at the same time conferred a degree of social and cultural legitimation upon the industry and its
major figures.

It was the major actors in the unfolding drama of studio formation who ultimately gave the studios their shape and
direction. The studios were very much the creations of individuals or small group related by blood, caste, or
communal ties. The rise and fall of the individual studios were closely tied to the fortunes of the individuals in
charge of the studio. Men like Ardeshir Irani controlled the business side of a studio (Imperial Studios) but, although
clear divisions of labour were beginning to appear within the industry, he was not a figurehead. He actually took
charge of the recording of the soundtrack of Alam Ara (Beauty of the World) the first Indian-produced talkie.(39)
The closeness of the studio boss to the process of filmmaking is reflected in the activities of other major figures in
the Bombay scene of the 1930s. Chandulal Shah entered the Bombay industry as a young man with the specific
purpose of producing films for Miss Gohar a major star at the time.(40) Their combination was successful and Shah
developed a studio (Ranjit Film Company) from this base which he translated into a position of some power within
the Bombay film industry. Shah produced films of two kinds that were successful at the box-office; a genre that
explored modern social themes in films such as Telephone Girl which starred Miss Gohar and appealed to the
sophisticated urban audience, and a genre of quasi-mythological films that appealed to a broader audience and
foreshadowed the modern masala film. Shah not only ran the studio but was also actively engaged in all aspects of
the filmmaking process: scenario writing, direction, production and publicity. At the same time he was very active in
industry politics.(41) The Wadia brothers followed a similar path to Shah. Their studio underwent a number of
transformations from its inception in 1927 until it became Wadia Movietone in 1933.(42) Their success stemmed
from their ability to cater for more than one segment of the market and their own involvement in the filmmaking
process. Wadia Movietone made the "modern" film that explored social issues and at the same time they made a
series of stunt films which borrowed heavily from the Hollywood B-movie and starred an Australian actress known
as Nardia.(43) The Wadias were also heavily involved in industry politics during the 1930s.

As the studios established themselves in Bombay in response to the growing demand for Indian films in
themofussil (or countryside) there developed a desire on the part of the filmmakers to consolidate their position with
the formation of a number of industrially based organisations. A similar pattern developed in Calcutta but the
Bengali based organisations never achieved the same degree of prominence as the Bombay ones.(44) A hastily
convened Bombay Cinema and Theatre Trade Association was formed so that unified evidence could be given to the
1927-28 Committee of Inquiry.(45) Out of this emerged other industrially based organisations such as the Motion
Picture Society of India (MPSI formed in 1932), the Indian Motion Picture Producers Association of India (IMPPA
1939). The producers were clearly the frontrunners in this development which represents a multi-faceted attempt to
secure their position at the centre of the Indian film industry. Moreover this proliferation of associations in the 1930s
was viewed in Calcutta as an attempt by the Bombay producers to secure their position at the expense of the other
regional film producing centres.(46)

The principal aims of the MPSI were both economic and ideological. It was meant to represent the interests of the
industry to the government which it did on at least two occasions in the 1930s.(47) Its other functions were less
clearly articulated. In one sense it set out to achieve the industry's commercial and social acceptance by recruiting
established figures to its cause. The first president had to be of an impeccable background. Sir Phiroze Sethna, who
was the inaugral President, had had a long and honourable career in both Bombay municipal politics and Indian
national politics; he was a director of over thirty industrial and commercial concerns in India including the giant
Tata Corporation; Chairman of the Sun Insurance Company of India, a major institutional lender and investor; and
he was acceptable to the British because of his background.(48) He had been their first choice of candidate to lead
the 1927-28 Committee of Inquiry.(49) However in the industrial politics of the 1930s Sethna proved to be the
exception rather than the rule. All subsequent chairmen of the MPSI came from within the industry, and there is no
evidence of any other figure of equivalent status to that of Sethna having served the industry.

Other organisations such as the IMPPA were linked to the MPSI through common membership and ideology, and
formally through constitutional ties. The MPSI in conjunction with the IMPPA became the voice of the industry. It
became responsible for the collection of the industrial data. It organised the conferences designed to bring all aspects
of the industry together for a common purpose. Its members were responsible for the publications that emerged in
the 1930s and which have formed the basis of all subsequent interpretations of the role of the studios in that period.
These include Y.A. Fazalbhoy's The Indian Film: a Review (1939) a large number of collations by B.V. Dharap, and
souvenir publications from within the industry.(50) Consequently it is not surprising that the majority of accounts of
the Indian film industry privilege the studios and decry their demise.

An additional area where the studios exercised considerable political influence was in the organisation of the all-
India Motion Picture Congress. The most important was held in Bombay in 1939.