Moving pictures were made as early as the 1880s, but weren’t offered to a paying audience until 1895. By 1920, silent film had become the dominant form of entertainment with, melodramas like Way Down East (1920) and comedies like High and Dizzy (1920). Mostly produced by five major studios and several smaller studios in California, New Jersey, and New York, early films were grouped into genres with easy to digest story lines.
By the 1930s, silent film stars were being cast in "talkies" - films with sound - leading to the development of more complex stories and genres. Color was introduced with films like The Wizard of Oz (1939) and Gone with the Wind (1939), and helped to usher in the Golden Age of Hollywood.
About the model, The Nickelodeon
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The Nickelodeon, named after the cost of admission - an American nickel - was one of the first theaters to specifically show silent films. Old storefronts could be coverted to theaters as long as there was a long space for seating and a back wall to hang a screen on. A live pianist or a gramophone would provide music to accompany the film.