MGM was formed in 1924 by Marcus Loew. The Metro-Goldwyn-Mayer of MGM belonged to three individual movie studios that had agreed to band together to create what would become the most famous movie studio in history. MGM was actually formed to act as a subsidiary of the Loew's Theater chain.
The cinematic philosophy attributed to the films made at MGM was one of glossy entertainment that rejected edgy qualities in exchange for glamor. While Warner Brothers films were noted for grittiness, MGM's film noticeably lack a quality of realism. Because the acting stable with filled with very glamorous stars, the studio heads did not want to do anything that made them appear like regular people and, as a result, there were always some objections raised that MGM presented a world distanced from reality, especially during the Depression.
MGM was considered more of a producer's studio than a director's studio. What is meant by this is that the producer had more input into the final product than the director. The producer had the power of final cut and it was not at all unusual for even a high-profile movie to be the work of several directors. For instance, at least five different directors contributed to "The Wizard of Oz."
The heyday of MGM was the 1930s. During this fertile period, MGM was responsible for turning several unknowns into screen legends, including Clark Gable, Mickey Rooney, Jean Harlow, Spencer Tracy and Judy Garland. In part, the rise of MGM can be attributed to boy wonder producer Irving Thalberg, who turned MGM into the foremost producers of highbrow movies and did much to create the MGM philosophy.
During World War II, many of the studio's biggest stars joined the military to fight. In effect, MGM lost many of its biggest stars, including Jimmy Stewart and Clark Gable. Because MGM had such an impressive stable of actors who were constantly being groomed for stardom, these stars were easily replaced by such new faces as Gene Kelly, Esther Williams and Lana Turner. As a result, MGM withstood the loss of its talent pool during the early to mid 40s much better than other studios.
MGM began to collapse along with the entire studio system in the 1950s. Competition from television made it necessary to make ever more extravagant movies on a bigger budget. Over the course of the decade, many stars were released from their contracts and the quality of the MGM product declined to the point that by the 1960s, it was no longer possible to distinguish between an MGM movie and a movie made at any other studio.
In 1972, MGM was purchased by investor Kirk Kerkorian who promptly sold off the studio's lucrative back lot and auctioned off much of its property and memorabilia. MGM was then combined with United Artists to make MGM/UA. After Ted Turner bought the studio solely for the purpose of owning the rights to the studio's extensive film library, he sold it back to Kerkorian. Over the course of the next few decades, the studio was bought and sold and nearly reached the point of absolute collapse. It is still known as MGM/UA.