Zukor’s zeal for consolidation and acquisition was relentless. He formatted the economic program that defined classical Hollywood cinema — the vertical integration of production, distribution and exhibition under a single studio shingle. A true oligopoly, it would serve as the model for each of the four other major studios that made up Hollywood’s Big Five (Warner Bros., MGM, Fox and RKO). As the film historian Robert Sklar stated in his landmark 1975 study Movie-Made America: A Cultural History of America Movies: “The studio system was the house that Adolph Zukor built.”
Under the management of B.P. Schulberg, head of production from 1925 to 1932, Paramount thrived with an eclectic and diversified product line. The highlight reel would include jazz age avatar Clara Bow, who embodied the antecedent in It (1926); William Wellman’s aerial spectacle Wings (1927), the first best picture winner; and Rouben Mamoulian’s innovative early sound film Applause (1929). Already, the studio was cultivating a reputation for smarts and sophistication. Overhearing his father and screenwriter Herman J. Mankiewicz breaking down the script for Mamoulian’s film version of Robert Louis Stevenson’s Dr. Jekyll and Mr. Hyde (1931), Budd Schulberg knew that “they weren’t ignoramuses butchering the classics; they were men and women who knew their Stevenson and were serious about bringing his work to the screen as authentically as possible.”
By the early 1930s, the Paramount house style had emerged. The code word was “Continental” — meaning that in location and attitude, the films affected a suave European worldliness about human desire that might ordinarily be expected to shock Victorian Americans — a mistress on the side, an adulterous lapse, a session of no-guilt transactional sex, all conducted in elegant-to-baroque surroundings somewhere offshore. Two directors — one florid, one discreet — typified Paramount in peak form: the authentically Viennese but bogus aristocrat Josef von Sternberg and the brilliant comedian of manners, Ernst Lubitsch.
Von Sternberg’s breakthrough was The Blue Angel (1930). Shot for Paramount at UFA studio outside of Berlin, simultaneously in German and English language versions, it brought Weimar decadence stateside in the person of Marlene Dietrich, who left for Paramount the very night the film premiered in Berlin. “She’s an eyeful,” low whistled Variety, eyeballing “those Continental soubrette costumes of much stocking, bare limb, and garters.” Commenting on the von Sternberg-Dietrich collaboration, film historian Ethan Mordden marveled at “a Continental art of such gesticulative eroticism, such impishly grotesque sophistication, that even today it’s hard to believe that Paramount let them make six films together within five years.”