BUSINESS UPTO 1906

In 1896 it became clear that more money was to be made by showing motion picture films with a projector to a large audience than exhibiting them in Edison's Kinetoscope peep-show machines. The Edison company took up a projector developed by Armat and Jenkins, the “Phantoscope”, which was renamed the Vitascope, and it joined various projecting machines made by other people to show the 480 mm. width films being made by the Edison company and others in France and England.
However, the most successful motion picture company in the United States, with the largest production until 1900, was the American Mutoscope company. This was initially set up to exploit peep-show type movies using designs made by W.K.L. Dickson after he left the Edison company in 1895. His equipment used 70 mm. wide film, and each frame was printed separately onto paper sheets for insertion into their viewing machine, called the Mutoscope. The image sheets stood out from the periphery of a rotating drum, and flipped into view in succession. Besides the Mutoscope, they also made a projector called the Biograph, which could project a continuous positive film print made from the same negatives.
There were numerous other smaller producers in the United States, and some of them established a long-term presence in the new century. American Vitagraph, one of these minor producers, built studios in Brooklyn, and expanded its operations in 1905. From 1896 there was continuous litigation in the United States over the patents covering the basic mechanisms that made motion pictures possible.