From 1978 to 1982, little was heard from Laughlin. It was rumored at the time that he had become a recluse embittered by his confrontations with the Hollywood establishment. But according to Laughlin himself, he had become wholly consumed with his studies of the work of psychologist Carl Jung. He wrote a book on the subject and lectured widely at various institutions and universities on Jung's model of the psyche. At the same time, he also began counseling terminally ill cancer patients, a personal charity in which he has since become even more involved. Those years off the set and out of the courts treated laughlin the student and teacher to a satisfying respite from the Hollywood battlefront. But in the fall of 1981, Tom Laughlin the filmmaker began to reappear, bringing with him the studio revolution still waiting to happen.
Encouraged by private investors, Laughlin set out by negotiating to acquire various and struggling minor studios with the intent of restructuring them according to his own economic model. But after two years, he still had no studio, and rather abruptly decided to abandon this approach altogether. "It just didn't make sense to buy someone else's problems," he says. A new studio, and a new industry structure, had to be built from scratch, he concluded. And true to form, he found a novel way to let the rest of the world know about his plans.
It was in the spring of 1984 when the series of full-page ads, densely filled with text, began appearing in Variety. Taken together, the 12 ads presented nothing less than the Laughlin Cosmology of Hollywood -- his conclusions about why this particular universe was seriously out of whack and his prescriptions for the cure. It was a far-flung indictment of Hollywood and its moribund practices, concluding with a comprehensive program of reorganization and rejuvenation along distinctly entrepreneurial lines. And to heighten the drama of its conclusions, Laughlin left the first 10 installments unsigned. It was only with publication of the final installments that Laughlin was revealed as "the best-kept secret in the motion-picture industry."
As it turned out, the mystery man had a lot to say, but the main line of his reasoning saw the studio system -- a generic expression usually taken to include the activities of Warner Bros., Paramount, Columbia, Universal, United Artists, Twentieth Century-Fox, and Walt Disney -- as "synonymous with economic mismanagement and crisis" and characterized by monolithic, overly centralized corporate structures. Just as the railroads were once criticized for failing to see that they were in the "transportation" business -- an oversight that ultimately caused them to lose markets to a rapidly growing trucking industry -- so too did Laughlin fault the studios for thinking they were solely in the business of making motion pictures rather than the "creation of mass-appeal visual entertainment." That error, he claims, caused the studios to cede gargantuan business opportunities, first to network television and later to cable television and videocassette distributors. As a result, he said, hundreds of newly formed cassette and television-syndication companies were getting rich distributing the studios' own product.
To remedy their shortcomings, Laughlin said that studios must realign their priorities and radically decentralize their operations an an effort to cut down on the "massive overhead" that was the source of so many of the industry's financial woes. In his ideal studio, each business activity -- financing, production, distribution, promotion, and syndication -- would be established as a separate, fully autonomous business with its own staff, its own business imperatives, and its own profits and losses. Perhaps the highest expression of Laughlin's decentralization strategy would come in the production division, which he thought could be further atomized into dozens of independent production companies, each with its own profits and losses and each headed by a name producer with a demonstrated "nose" for what audiences wanted to see. Such a scheme, Laughlin promised, would produce "tight fiscal control and total creative freedom" and abort the rapid and seemingly inexorable rise of motion-picture production costs.
During their anonymous run in Variety, Laughlin's ads produced widely different reactions within the Hollywood community. One Laughlin acquaintance whispered to him at a dinner party that the unsigned ads were actually the work of a well-known studio executive who was plotting to stage a power play for control of his studio. But in addition to unsolicited opinions, there were also serious inquiries made of the unknown author, none more memorable than the one from the studio official who wrote to learn more about the distribution strategies mentioned in the ads. When, in response, Laughlin aide Robin Hutton telephoned the executive and identified her affiliation, the man refused to come to the phone and insisted, through his secretary, that the letter was a forgery.
More than likely there were many more movie moguls who would have liked to dismiss Laughlin's entire analysis with equal aplomb. That, however, would have been very difficult. For one thing, Laughlin carried some persuasive credentials, to wit: a hit picture, supersaturation, and the megamultiple. And for another, the moguls and their lieutenants knew in their guts that on many points he was absolutely right. After all, the major studios were about to enter a turbulent period in which their financial performance and their responses to crucial changes within the industry would be found wanting. Furthermore, many of Laughlin's observations would soon be confirmed by the success of several smaller, independent studios that had been recently established by some of the industry's most celebrated producers. And finally, even as he wrote, the major studios were trying frantically to fashion a belated response that could give them a more lucrative participation in the burgeoning videocassette industry.
