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RKO spent heavily on the lavish Rio Rita, including a number of Technicolor sequences.

Opening in September to rave reviews, it was named one of the ten best pictures of the year by Film Daily.

RCA chief David Sarnoff engineered the merger to create a market for the company's sound-on-film technology, RCA Photophone.

By the mid-1940s, the studio was under the control of investor Floyd Odlum.

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However, its hopes of joining in the anticipated boom in sound movies faced a major hurdle: Warner Bros.Maverick industrialist Howard Hughes took over RKO in 1948.After years of turmoil and decline under his control, Hughes sold the troubled studio to General Tire and Rubber Company in 1955.In 1989, this business with its few remaining assets, the trademarks and remake rights to many classic RKO films, was sold to new owners, who now operate the small independent company RKO Pictures LLC. released The Jazz Singer, the first feature-length talking picture.

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Its success prompted Hollywood to convert from silent to sound film production en masse.

Declaring that it would make only all-talking films, RKO began shooting at the small facility FBO shared with Pathé in New York City while the main FBO studio in Hollywood was technologically refitted.