Source: generated by author using figlet. License: public domain.

Question: Why is the US Film Industry established in Hollywood, California?
Answer: Because film-makers wanted to make films without paying patent fees thereby reducing costs.

In the early 1900s, New York was the film industry’s head quarters. However, the patent for movie making equipment was owned by Thomas Edison and he enforced them. The following excerpt is from Lawrence Lessig’s 2004 book, Free Culture:

Creators and directors migrated from the East Coast to California in the early twentieth century in part to escape controls that patents granted the inventor of filmmaking, Thomas Edison…. California was remote enough from Edison’s reach that film-makers there could [use] his inventions without fear of the law. And the leaders of Hollywood filmmaking, Fox most prominently, did just that.

Not paying royalties reduced their costs thereby increasing their profits.

Costs Matter is a series that asks different questions all of which have the same answer: to keep down costs. The series focuses narrowly on the impact of costs. It does not claim costs are the only reason things are as they are. To read more stories in the series, visit https://medium.com/galileo-onwards/costs/home/.