Editing Universal Pictures (section)

===The Laemmles lose control===
Universal's forays into high-quality production spelled the end of the Laemmle era at the studio. Taking on the task of modernizing and upgrading a film conglomerate in the depths of the [[Great Depression]] was risky, and for a time, Universal slipped into [[receivership]]. The theater chain was [[scrapped]], but Carl Jr. held fast to distribution, studio, and production operations.

The end for the Laemmles came with a lavish version of ''[[Show Boat (1936 film)|Show Boat]]'' (1936), a remake of its earlier 1929 [[part-talkie]] production, and produced as a high-quality, big-budget film rather than as a [[B-picture]]. The new film featured several stars from the Broadway stage version, which began production in late 1935, and unlike the 1929 film, was based on the Broadway musical rather than the novel. Carl Jr.'s spending habits alarmed company stockholders. They would not allow production to start on ''Show Boat'' unless the Laemmles obtained a loan. Universal was forced to seek a $750,000 production loan from the Standard Capital Corporation, pledging the Laemmle family's controlling interest in Universal as [[collateral (finance)|collateral]]. It was the first time Universal had borrowed money for a production in its 26-year history. The production went $300,000 over budget; Standard called in the loan, cash-strapped Universal could not pay, and Standard foreclosed and seized control of the studio on April 2, 1936.

Although Universal's 1936 ''Show Boat'' (released a little over a month later) became a critical and financial success, it was not enough to save the Laemmles' involvement with the studio. They were unceremoniously removed from the company they had founded, with studio advertisements referring to "the new Universal". Because the Laemmles personally oversaw production, ''Show Boat'' was released (despite the takeover) with Carl Laemmle and Carl Laemmle Jr.'s names on the credits and in the film's advertising campaign. Standard Capital's [[John Cheever Cowdin|J. Cheever Cowdin]] had taken over as president and chairman of the board of directors and instituted severe cuts in production budgets. Joining him were British entrepreneurs [[C.M. Woolf]] and [[J. Arthur Rank]], who bought a significant stake in the studio.<ref>{{Cite news|date=March 15, 1936|title=Linked to British Company|language=en-US|work=The New York Times|url=https://www.nytimes.com/1936/03/15/archives/linked-to-british-company.html|access-date=May 26, 2021|issn=0362-4331}}</ref> Gone were the big ambitions, and though Universal had a few big names under contract, those it had been cultivating, like William Wyler and [[Margaret Sullavan]], left.

Meanwhile, producer Joe Pasternak, who had been successfully producing light musicals with young sopranos for Universal's German subsidiary, repeated his formula in the United States. Teenage singer [[Deanna Durbin]] starred in Pasternak's first American film, ''[[Three Smart Girls]]'' (1936). The film was a box-office hit and reputedly resolved the studio's financial problems. The film's success led Universal to offer her a contract, which for the first five years of her career, produced her most successful pictures.

[[File:Destry-Rides-Again-1939.jpg|thumb|right|[[James Stewart]] and [[Marlene Dietrich]] in ''[[Destry Rides Again]]'' (1939)]]
When Pasternak stopped producing Durbin's pictures, and she outgrew her screen persona and pursued more dramatic roles, the studio signed 13-year-old [[Gloria Jean]] for her own series of Pasternak musicals from 1939; she went on to star with [[Bing Crosby]], [[W. C. Fields]], and [[Donald O'Connor]]. A popular Universal film of the late 1930s was ''[[Destry Rides Again]]'' (1939), starring [[James Stewart]] as Destry and [[Marlene Dietrich]] in her comeback role after leaving [[Paramount Pictures|Paramount]].

By the early 1940s, the company was concentrating on lower-budget productions that were the company's main staple: westerns, melodramas, serials, and [[sequels]] to the studio's horror pictures, the latter now solely B pictures. The studio fostered many series: [[Little Tough Guys|The Dead End Kids and Little Tough Guys]] action features and serials (1938–43); the comic adventures of infant [[Baby Sandy]] (1938–41); comedies with [[Hugh Herbert]] (1938–42) and [[The Ritz Brothers]] (1940–43); musicals with [[Robert Paige]], [[Jane Frazee]], [[The Andrews Sisters]], and [[The Merry Macs]] (1938–45); and westerns with [[Tom Mix]] (1932–33), [[Buck Jones]] (1933–36), [[Bob Baker (actor)|Bob Baker]] (1938–39), [[Johnny Mack Brown]] (1938–43); [[Rod Cameron (actor)|Rod Cameron]] (1944–45), and [[Kirby Grant]] (1946–47).

Universal could seldom afford its own stable of stars and often borrowed talent from other studios or hired freelance actors. In addition to Stewart and Dietrich, [[Margaret Sullavan]] and [[Bing Crosby]] were two of the major names that made a couple of pictures for Universal during this period. Some stars came from radio, including [[Edgar Bergen]], [[W. C. Fields]], and the comedy team of [[Abbott and Costello]] ([[Bud Abbott]] and [[Lou Costello]]). Abbott and Costello's military comedy ''[[Buck Privates]]'' (1941) gave the former [[burlesque]] [[comedians]] a national and international profile.

During the war years, Universal did have a co-production arrangement with producer [[Walter Wanger]] and his partner, director [[Fritz Lang]], lending the studio some amount of prestige productions. Universal's core audience base was still found in the [[neighborhood movie theaters]], and the studio continued to please the public with low- to medium-budget films. [[Basil Rathbone]] and [[Nigel Bruce]] in new ''[[Sherlock Holmes (1939 film series)|Sherlock Holmes]]'' mysteries (1942–46), teenage musicals with [[Gloria Jean]], [[Donald O'Connor]], and [[Peggy Ryan]] (1942–43), and screen [[Film adaptation|adaptations]] of radio's ''[[Inner Sanctum Mysteries]]'' with [[Lon Chaney Jr.]] (1943–45). [[Alfred Hitchcock]] was also borrowed for two films from [[Selznick International Pictures]]: ''[[Saboteur (film)|Saboteur]]'' (1942) and ''[[Shadow of a Doubt]]'' (1943).

As Universal's main product had always been lower-budgeted films, it was one of the last major studios to contract with [[Technicolor]]. The studio did not make use of the [[three-strip Technicolor]] process until ''[[Arabian Nights (1942 film)|Arabian Nights]]'' (1942), starring [[Jon Hall (actor)|Jon Hall]] and [[Maria Montez]]. Technicolor was also used for the studio's remake of their 1925 horror melodrama, ''[[Phantom of the Opera (1943 film)|Phantom of the Opera]]'' (1943) with [[Claude Rains]] and [[Nelson Eddy]]. With the success of their first two pictures, a regular schedule of high-budget Technicolor films followed.