ABSTRACT
The myth remains: Warners was broke and thus gambled on talkies. Harry, Abe, Sam, and Jack Warner had no other choice. But investigating this myth, I found it made no sense and was not supported by the data. The innovation of sound by Warners’ Vitaphone, from a strictly economic point of view, spells out that Vitaphone was a carefully conceived business strategy that revealed itself in a series of cautious, steady, expansionary steps. Although the success of The Jazz Singer may have exceeded the Warner expectations (and everyone else’s, for that matter), that success could be properly exploited because the Warners had laid the basis for further expansion. Without such prior planning, one hit film could have never thrust Warner Bros. to the top of the film industry with Paramount and Loew’s/MGM.1
