The Shop Around the Corner is the movie You've Got Mail was based on - however, it has a much darker tone. The Christmas element only came in during the last half-hour or so, but still, it was a fun holiday movie. I still don't know why they decided to set it in Budapest, though.

Lubtisch beautifully tells his stories. This simple movie transcends genre or style and is instead a morality tale. Only the great masters can achieve this level of simplicity and legacy.

James Stewart is well known for his Christmas film, 'It's A Wonderful Life'; however, he has another lesser known Christmas film that is equally delightful and heartwarming that has a message to be known. 'The Shop Around the Corner' is a wonderfully made film about two co-workers that don't get along and unbeknownst to them, they are actually pen pals. They are both lonely and desperate - looking for someone to love. Stewart and Sullavan are the pen pals - the main characters, but around them, the other characters are dealing with loneliness and affairs as well. Through the wonderful acting of everyone in the cast and the witty dialogue, the themes (loneliness, love, secrecy, and affairs) come to be known. No one wants to be alone, and no one should be. That is what this film is all about. There is a lot of heart and sentiment in this film - definitely a heartwarming film with a Hollywood ending.

THE SHOP AROUND THE CORNER (Metro-Goldwyn-Mayer, 1940), produced and directed by Ernst Lubitsch, is a delightful tale of two store employees who don't get along very well, unaware they're carrying on a pen-pal correspondence through the mail that starts with "Dear Friend." Starring Margaret Sullavan and James Stewart for the third time together, following NEXT TIME WE LOVE (Universal, 1936), and THE SHOPWORN ANGEL (MGM, 1938), there's no doubt that this comedy-drama, based on the Hungarian play by Nikolas Laszlo, happens to be their finest collaboration thus far. Although a circumstantial love story from the viewpoint of its central characters, the film rightfully belongs to the owner of the shop around the corner, as wonderfully played by Frank "The Wizard of Oz" Morgan.What's the story about? Opening title reveals: "This is a story of Matuschek and Company - of Mr. Matuschek and the people who work for him. It is just around the corner from Andrassy Street - on Balta Street, in Budapest, Hungary." The shop, Matuschek and Company, consists of various workers starting with its founder, Hugo Matuschek (Frank Morgan), a middle-aged man devoted to both his store and wife, Emma, of 22 years; and staff: Alfred Kralik (James Stewart), a nine year employee/salesman and Matuschek's most trusted and closest friend; Mr. Petrovitch (Felix Bressart), a happily married family man whose the very first to arrive ten minutes before the store opens; Pepi Katena (William Tracy), an errand boy with a squeaky voice; salesgirls, Flora (Sara Haden) and Ilona (Inez Courtney); and Ferencz Vadan (Joseph Schildkraut), a "yes" man who mysteriously arrives each day by taxi loaded with large money bills in his pocket and expensive wardrobe. One morning, Klara Novak (Margaret Sullavan) arrives seeking employment. She successfully sells herself by selling an "O Tchonia" playing music box to a plump lady customer who mistakes it for a candy box. During the course of her six month stay at Matuschek and Company, Klara and Alfred find themselves constantly arguing, unaware that they carrying on a romance through the mail left in a post office box. Further complications arise as Alfred notices Mr. Matuschek to suddenly act indifferently towards him, even to a point of dismissing him before Christmas for no apparent reason.Being an Ernst Lubitsch production where his traditional locales to his motion pictures having European backdrops, mostly Paris, interestingly THE SHOP AROUND THE CORNER is a sort of story that could very well have taken place anywhere at anytime. Following the pattern of remakes, the musical version retitled IN THE GOOD OLD SUMMERTIME (MGM, 1949) starring Judy Garland and Van Johnson, takes place at turn-of-the-century Chicago; while the most updated edition, YOU'VE GOT MAIL (Warner Brothers, 1998) with Meg Ryan and Tom Hanks, not only is set in New York City, but uses the internet as its means of communication between pen-pal writers. With the exception of European born actors, Joseph Schildkraut and Felix Bressart, along with label signs written in Hungarian, many of the other players are essentially Americans talking naturally without any attempts using accents. Had director Lubitsch attempted on using European-born performers in leading roles as the two-time Academy Award winning Viennese born Luise Rainer as Klara, with Czech Francis Lederer as Alfred, for example, the outcome would have turned out entirely different and possibly not as successful as with the selected players as Sullavan and Stewart. Frank Morgan, best known for playing befuddled characters, is shown to best advantage here breaking away from his typical "Morgan style" for a more straightforward performance. Aside from serious performances from THE MORTAL STORM (1940), that reunited him with Sullavan and Stewart, and the much better known THE HUMAN COMEDY (1943) starring Mickey Rooney, it makes one wish Frank Morgan did more dramatic roles like these as opposed to the tailor-made double-talking bumbling characters he's done so often, even in his signature role as THE WIZARD OF OZ (MGM, 1939).Being a versatile actor, Morgan, believably having that European presence through his thick mustache and old-style haircut, gives a performance worthy for an Academy Award nomination as Best Supporting Actor. His key elements include moments of humor for not trying to influence his employees when asking for their honest opinions; his surprise reaction when discovering the error of his ways towards his trusted employee, Alfred; and a heartfelt moment when inviting his newest and youngest employee, Rudy (Charles Smith), age 17, living alone in Budapest, to have dinner with him on Christmas Eve. When Morgan isn't around, the concentration resumes on the feuding store employees, Klara and Alfred. One unforgettable moment includes a scene outside the café where Alfred looks through the window, after being told by his friend, Petrovitch, that his pen-pal, with only means of identification being a Leo Tolstoy book, "Anna Karenina," happens to be Klara. While he doesn't give away his identity, he does surprise her when stopping by her table, only to soon be insulted and hurt when angrily called an "insignificant clerk." Other scenes involving Klara and Alfred are both amusing and touching in the best Lubitsch style and tradition. A pleasing musical score by Werner Hermann during its opening and closing credits is also worthy of an honorable mention here. No wonder THE SHOP AROUND THE CORNER has lived up to its expectations in recent years as an exceptional motion picture.Formerly on video cassette since the late 1980s, and later available in the DVD format, for anyone looking for a bargain when it comes to shopping for a good movie with a Christmas theme, THE SHOP AROUND THE CORNER should make any customer satisfied without asking for refunds or exchanges the next time it's broadcast on Turner Classic Movies cable channel. (***1/2)