There can be few people in this or any other country, who wouldn’t be able to say where Hollywood is and what it stands for. The movies. But the movies are far more than mere reels of celluloid that, when projected on a screen at 24 frames per second, trick the eye into seeing moving images.

And Hollywood is far more than just the place that makes the reels. For the better part of a century this otherwise unremarkable Los Angeles suburb has produced and presented imagined worlds that help shape our ideas of sex, romance, violence, tragedy, greed, goodness and far more besides. No wonder Hollywood is often called “the dream factory”.

“Dream”, with its hints of strange situations and unusual desires, we can understand. After all, these have long been the hallmarks of the typical Hollywood product. But “factory”? Factories churn out the same or similar products to be bought at low cost by lots of people. Surely Hollywood’s most shining stars - Clark Gable, say, or Marilyn Monroe and Judy Garland - weren’t glorified factoryworkers? History suggests otherwise. Well paid, to be sure, but still factory workers.

Financed by and answerable to Wall Street, Hollywood by the 1930s was largely made up of the so-called Big Five studios - MGM, Paramount, Twentieth Century Fox, Warner Brothers and RKO - plus the Little Three of Universal, Columbia and United Artists. Over time, the combined efforts of the studios had resulted in the “vertical integration” of the industry - their almost total dominance over the production, distribution and screening of movies.

Crucial to this dominance was the studios’ relationship with cinemas across the US. This served to generate as much cash as possible. A carefully controlled distribution system ensured that new releases were shown first at the plushest and priciest “first-run” cinemas, usually in city centres.

Then, after a set time or “clearance”, the same film was screened at less expensive, hence less profitable, “second-run” cinemas in a different area or “zone”. Again, after a designated interval the movie would be moved to a cheaper cinema for its “third run” and so on.

As they owned the majority of the most profitable, “first-run” cinemas, the Big Five gained around 50 per cent of their total revenue from these alone.

Independent cinema owners were taken care of by being compelled to buy whole blocks of films for a season without having seen a single one, an arrangement whereby the studios gained a flow of ticket receipts to finance the making of new films. All of which accounts for the term “dream factory”. As with wheels, so with reels: if the Ford plant in Detroit produced most of the nation’s cars by assembly line, so Hollywood used similar means to maintain a steady supply of films to the nation’s cinemas.

And, as in most other factories, the means of making decisions in Hollywood were as well defined as they were decisive.

At the top of the organisational pyramid was the studio chief, a man - never a woman - who sometimes also served as head of production. He and trusted executives would select “properties” - plays, story adaptations, original ideas - as suitable raw material for films before passing them to the studio’s associate producers, who would then oversee the creation of a screenplay by a team of writers. The final pre-production stage was complete when the studio chief assigned the task of making the film to a staff director and selected stars.

And, like it or not, the director and stars had to make the film. As with any mass production system, the absence of choice in the Hollywood studios resulted from the need to maintain output; if the system slowed down or stopped, money was lost. Employees free to choose the films they made or to negotiate salaries could be costly in terms both of time and money. Worker discipline was important, therefore; and the option contract, a pivotal feature of the studio system, ensured that the stars - by far a studio’s most valued assets - kept to the rules.

The usual length of the contract between a studio and a major star was seven years. During this time the star was tied to the studio and required to appear in whichever films were thought suitable. Stars who declined could be suspended by the studio or have the time the film took to make added to their contract. In this as in other matters, the studio exercised total control, with the right to drop or renew the contract giving it an annual option of getting rid of any star thought less valuable than before.

So while the wages and perks were good, the other conditions of service were less rewarding. The result was that even major stars did as they were told, but grumbled, fretted and sulked while working for a studio that had made but could just as easily break them. Many stars were unhappy at not being able to stretch themselves by playing different roles.

“I have never been consulted as to what part I would like to play. I am paid not to think,” said Clark Gable while contracted to MGM. James Cagney talked of his unhappiness at having to play “dese, dem and dose” parts - in other words, dim or violent New Yorkers - at Warner Brothers.

“I could be forced to do anything the studio told me,” recalled Bette Davis of her time at the same studio. “The only recourse was to refuse, and then you were suspended without pay. When under suspension you could not even work in a five-and-dime store.”

There were other, less direct ways of reminding stars of how easily they could lose their lustre. While doing costume tests one day in 1939, David Niven noticed another young ambitious actor dressed as the character Niven coveted in a forthcoming film. Niven took the hint and signed the contract he had disputed with producer Sam Goldwyn.

Niven, always a prominent member of the awkward squad, had also been given some very different star treatment by Louella Parsons and Hedda Hopper, Hollywood’s most prominent and powerful gossip columnists from the 1930s to the 1950s. The studio bosses regularly fed embarrassing or even potentially ruinous information about troublesome employees to the Hollywood Harpies, as the two were known. A visit by either columnist to a wayward star, with hints dropped here and there, usually ensured compliance with the studio’s wishes.

Plainly, the studio chiefs liked to get their own way. Some idea of their nature and methods can be gained from anecdotes that might sound fanciful but are not. So appalling was the humiliation of subordinates by MGM head of production Louis B Mayer that Dore Schary, Mayer’s sensitive second in command, sometimes left the room to vomit. Ignoring the protests of director William Wyler that the set of the 1937 production Dead End was a replica New York slum, Sam Goldwyn insisted that the film be made with the streets cleared of rubbish. Wyler did as he was told.

“I don’t have ulcers, I give them,” was the favourite boast of Harry Cohn, head of Columbia Pictures. At Cohn’s funeral in 1958, the officiating rabbi was asked if he could say “one good thing” about the deceased. The rabbi paused and said, “He’s dead.”

Those few stars bold enough to fight back gained mixed results. In 1932, James Cagney walked out of Warner Brothers, claiming that he was paid too little. After a protracted legal battle, he returned to the studio on improved terms.

“A naughty little girl who wants more money,” was how a Warner Brothers’

lawyer described the formidable Bette Davis when she challenged her terms of employment in 1936. Securing an increased salary only through a revised contract that required her to “perform and render her services whenever, wherever and as often as the producer requested,” Davis must have wondered if it had been worth it.

But the studio chiefs soon had far more than their stars’ contracts to worry about. In 1938 the US Justice Department began a lawsuit against the eight major studios, charging them with operating a monopoly in the distribution and exhibition of films. The case dragged on until, in 1948, the studios agreed to sell off their cinema chains and so break up the system of vertical integration that had ensured their overall control of the industry. Not long afterwards, the end credits started to roll on the old-style Hollywood studio system.

Today, many former studio lots - huge tracts of land that once held enormous sound stages, artificial lakes, administration buildings and outdoor film sets - are gone, and those that remain see more films made for television than for the multiplexes that show American films around the world.

And those famous studio names have long been absorbed into immense multinational conglomerates, business empires - News Corporation, Time Warner, Sony International - with multiple interests worth billions.

Gone, too, are the tyrannical studio bosses, men who could jab a finger at a quaking star and scream: “You’ll never work in this town again” - and mean it.

Gone for the better, probably - although some doubt it, pointing to the astronomical sums demanded for their services by stars. Take, for example, the $30 million being paid to Arnold Schwarzenegger for the forthcoming Terminator 3 or the recording breaking $50 million paid to Jack Nicholson for Batman in 1989. “Include me out,” Sam Goldwyn would have said of the fee. The other studio heads might have chuckled at the characteristically cracked grammar, but they would have cheered the sentiment to the echo.

GENRE AND AUTEURISM

Just as the Ford car factories limited the number of models available so as to maximise production efficiency (“Any colour so long as it’s black”), so the Hollywood film factories avoided reinventing the wheel by turning out their own standardised products.

Hence the evolution of various film genres, types of film classifiable according to their signifiers, stars and narrative styles. Though formulaic, such films - thrillers, romances, war films, westerns and so on - were more easily made and marketed. This standardisation also reduced production time and the risk of audiences rejecting anything too unexpected or difficult.

However, this reliance on formula products soon led to cliched dialogue, narrative and characters. Not that audiences objected; as today, cinema-goers seemed happiest with what was most familiar. Some directors, though, were able to rise above the production-line demands of the studio system and create films that, as well as having a distinctive stamp - the director’s “style signature” - often offered meanings altogether absent from more workaday productions. These directors were dubbed auteurs (“authors”) by French critics: “Film authors, thanks to us, have finally entered the history of art,” wrote Jean-Luc Godard in 1959.

Prominent among those then acknowledged as auteurs were Howard Hawks, Fritz Lang, Nicholas Ray and Alfred Hitchcock. Contemporary critics would point to Martin Scorsese, Woody Allen, the Coen brothers and Steven Spielberg as skilled auteurs. Other critics, though, contest the idea of authorship, arguing that the collaborative nature of filmmaking means that no single figure should be thought entirely responsible for so complex an enterprise as a film. Take Goodfellas, Martin Scorsese’s 1990 gangster masterpiece: should a film that owes so much to Thelma Schoonmaker’s editing be viewed as the responsibility of just one man?

Lately, the notion of authorship has been extended to include stars so popular - and, by extension, powerful - that they shape a film as much if not more than the director. Indeed, George Clooney recently admitted that his presence alone is frequently the most important factor in getting a film made in the first place.

MEDIA IMPERIALISM

Hollywood has long dominated the world film market and has long been resented for it. Critics of American cinema complain that, some few examples apart, Hollywood films are vulgar, slick and simplistic, the product of an industry more focused on economic gain than artistic merit.

The commercial benefits of American films were recognised from the early days of Hollywood. Not only were they highly profitable in themselves, but they also projected idealised and enviable images of American life around the globe. “American films serve as silent salesmen for products of American industry,” was how Joseph H Kennedy, father of the future US president, put it to fellow bankers in 1927.

They still do, with companies paying tens of thousands of dollars to have their products shown in a film. Sales of Ray Ban sunglasses soared after Tom Cruise wore them in Top Gun, while several glimpses of the Apple PowerBook in Mission: Impossible worked to similar effect. Many critics complain not only about such product placement, but also the covert promotion of ideas. Even those who despised American values could still admire the way American films exported standards and beliefs.

Recent attempts to stem the tide of American films have been as varied as they have been unsuccessful: in 1989, South Korean nationalists released snakes in a cinema where they were being shown, while French filmmakers and academics regularly agitate against US imports that earn far more than home-grown fare.

To date, however, neither reptiles nor reproof have stopped the films nor the fans from paying to see them.