With Variety recently announcing that production for the next film in the Bond franchise is to be put on hold, the future is starting to look really bleak for MGM.
MGM was founded in 1924, when Marcus Loew gained control of Metro Pictures, Goldwyn Pictures and Louis B Mayer Pictures. He combined them into Metro-Goldwyn-Mayer, with the classic logo of a roaring lion surrounded by a circle of filmstrip and under the motto "Ars Gratia Artis", which was Latin for "Arts for Art's Sake". Though Loew himself died three years later, two men would raise the fledgling studio to become the most successful studio of the Golden Age era. They were studio chief Louis B. Mayer, and his wunderkind head of production Irving Thalberg. together they made MGM the dominant studio in Hollywood through their acquisition of stars (such as Lon Chaney, Clark Gable, William Powell, Greta Garbo, Joan Crawford, Jean Harlow) and their classy, sophisticated style. They produced such films as The Wizard of Oz, Northwest Passage, the Andy Hardy and Thin Man series, Grand Hotel, Ninotchka, and countless others.
Like most studios, however, the latter half of the 20th century was problematic, and at this point in time, despite an extensive film library that is its greatest asset, the studio owes nearly $4 billion dollars to creditors. Unlike studios such as Warner Bros., which is owned by conglomerate Time Warner, MGM has never really diversified out of the movie production and distribution business. With DVD sales on a huge down curve, and less people heading to the movies than in years past, the studio has found itself in serious, serious trouble.
Currently, the consortium that owns MGM is putting itself up for auction, and Time Warner, Lionsgate and other parties have been interested, but there isn't a lot of hope that a deal can be made for the studio as it exists now. Rather, what may happen is that the studio may be sold off in pieces, which debt holders are objecting to, as the fire sale prices are below the value of what MGM actually has, such as the wildly profitable James Bond franchise, and a standing deal to co-produce the upcoming two-film adaptation of The Hobbit with Peter Jackson and New Line.
While it's sad to see a grand old lady like MGM go up on the block, I'm sure the lion will still roar in front of some movies; that's too valuable a name to let gather dust. Still, this could be the beginning of the end of studios as we know them. We'll see what the future holds.