"During that time, very bad slump. Business was not good. And a lot of shops were closed down. Dont know what to do. Nobody came to the shows. So we reduced the admission prices. Even the pictures, old pictures shown already were shown again."

- Tan Sri Runme Shaw, Pioneers of Singapore, Oral History

When the Great Depression hit, the theatres went through rough times as nobody could afford to patronise the movies.

Besides cutting ticket prices at the Empire (50 cents to 5 cents for the front row, and 75 cents to 10 cents for the back row), the Shaws also began double-featuring films and bringing in live shows to arouse interest.

In 1934, an independent producer, Bombay Chemical Co, released the more successful of two pioneer feature film efforts in Singapore - 'Laila Majnum'. It was a malay film loosely based on Romeo and Juliet and was directed by B.S. Rajhans. The other local production, 'Samarang' , was made by American film maker Ward Wing. It was released almost simultaneously as 'Laila Majnum' but failed miserably at the box office.

The success of 'Laila Majnum' made enough impact for the Shaws to believe that local productions could cater to the needs of their growing cinema chain in Malaya and Indonesia. By producing locally, the Shaws hoped not only to profit financially but also to control all aspects of their film business - exhibition, distribution and production.

By 1937, the Shaws began establishing the basic infrastructure to make Malay films in Singapore. They brought in equipment and experienced technicians from Hong Kong and Shanghai.

A studio was set up at No.8 Jalan Ampas. On screen talents came from local Malay opera troupes. These films which ranged from family dramas to love stories to horror found a ready audience.

Topeng Hitam (Black Mask), Mutiara (Pearl), Gagak Hitam (Black Crow), Bermadu (The Rival), Hanchor Hatt (Broken Heart), Ibu Tiri (Stepmother), Topeng Shaitan (Devil's Mask), Mata Hantu (Ghost Eyes), Kekasih Tiga (Three Lovers) and Terang Bulan Di Malaya (Full Moon In Malaya) were among the first made-in-Singapore movies.