In 1896, the famous inventor Thomas Edison won the patent for the Latham Loop, a device that prevented the film inside a camera from snapping. Thus ensued a series of conflicts, lawsuits, piratings, and armed confrontations, as would-be movie producers struggled to attain independence from Edison's attempt to monopolize the movie industry. As the more fanciful story goes, Hollywood was chosen as a base by these renegade producers because its proximity to the Mexican border offered a safe place to hide from Edison's bully-gangs.

Ultimately, the renegade producers won the day, and the Hollywood studio system was born. From the 1920s through the 1940s, if a movie was to be made, you can bet that it was made by a Hollywood studio. The studios not only controlled most of the people and talent of the American film industry, they also regulated artistic vision, theme, content, and subject. But no matter how stifling such control became, there was no alternative source for the kinds of funds that were required to produce a modern film. A series of critical blows attempted to change all that. First, an anti-trust suit regulated the studios' ability to make, distribute, and exhibit their movies. Second, foreign countries began to impose massive taxes on American film exports. Third, after World War II, a paranoid, Cold-War nation allowed Senator Joseph McCarthy to eviscerate Hollywood in his maniacal search for communist sympathizers. The final blow, the coup de grace, was the introduction of television, which brought the cinema into the home, providing an alternative to weekly movie attendance.

However, the Hollywood that emerged from the studios' smoking ruins was perhaps an even more streamlined movie-making machine. A system based upon agents, publicists, and producers, films are now produced by massive conglomerates. Actors, directors, and other creative film artists are no longer 'stabled' by studios, but are free agents, able to work when, for whom, and as regularly as they desire. Ensuing bidding wars for top talent and expenditures on bigger and better special effects have skyrocketed the costs of studio production.

As a result, the big Hollywood conglomerates produce films that are designed to return big on investments. American films have become known for prioritizing massive profits over and above any artistic or social considerations. Spectacular visual tricks and effects, often combined with rather formulaic plots and characters, have given American films a special reputation as some of the most entertaining, yet intellectually vapid, productions in the world. In response, an Independent film movement has evolved in the United States, which exchanges the focus on profit for artistic vision. An odd, precarious balance has been reached between the two forms of American film, as audiences continue to flock to blockbuster movies only to find themselves unsatisfied by the lack of any real content. In frustration, they occasionally foray into independent productions, so that the inadequacies of the mainstream market actually seems to, in an ironic way, drive the independent market.