Toon-in turn-on
Will H’w‘d’s post-‘Shrek’ fever create an animation glut?
By BEN FRITZ
In a distant corner of Glendale, Calif., sits a cluster of substantial if architecturally nondescript structures, where pleasant-looking workers stroll across pleasant lawns to enter their pleasant offices, where they sit staring at computer screens.
To the outsider, it looks like a government workplace. In fact, it’s a movie studio — and one of the most profitable around.
DreamWorks AnimationDreamWorks Animation is the antithesis of the traditional studio. There are no klieg lights, no dressing rooms, no golf carts to carry people between soundstages. In fact, there are no soundstages.
All “post-production” is completed before principal filming begins. Directors plan every shot so that virtually every completed image is used. While most studios crank out 15 to 25 features each year, DreamWorks Animation has an annual output of two films.
It’s the perfect method of filmmaking for a hands-on production head, who can oversee every aspect of filmmaking from early development through “reshoots” (which are remarkably easy: just a few people sitting at computers).
And Jeffrey KatzenbergJeffrey Katzenberg is a hands-on kind of guy. But associates have noticed a distinct mellowing in his personality. The CEO of DreamWorks Animation still devotes himself to his work with a maniacal intensity, as he did during his 10-year tenure at Disney and his subsequent years at DreamWorks, and is still capable of scheduling three successive breakfasts on a given morning.
But Katzenberg’s manner with friends and employees is much calmer and more thoughtful. The changes, some suggest, stem from the bumps in his career, which for years had a relentlessly upward arc. His acrimonious exit from Disney, the problems in launching DreamWorks and failures like its 2-D animated “Sinbad”“Sinbad” were humbling experiences for him.
The immense success in launching DreamWorks Animation, with the overwhelmingly positive response to its stock offering — it now trades more than $10 above the IPO offering price of $28 — brought new exuberance to his style. The net effect is a kinder, gentler Katzenberg.
Aside from his energetic fund-raising for social causes, the results can be seen on more immediate levels, such as free food at the company cafeteria — though it’s partly a practical move, since the “campus” is so remote, there are no restaurants nearby.
He can afford to be more relaxed. Like PixarPixar’s Steve Jobs, who started the CGI boom with 1995’s “Toy Story,” Katzenberg is one of the leaders of the CGI movement in Hollywood. And right now, that is the most profitable genre of Hollywood filmmaking — since 1995, 13 of 14 CGI films have been hits, with 12 of them passing $100 million at the box office.
Pixar is the undisputed leader, with six mega-grossing CGI toons, followed by DreamWorks with four. And now everybody wants to get into the act.
Next year, every major studio will release an animated film, most with budgets of more than $100 million. Some will release two. The 11 major toons set for release next year is a big jump from seven apiece in 2004 and 2005.
It’s not hard to see why. DreamWorks’ “Shrek 2” and “Shark Tales” and Disney/Pixar’s “The Incredibles” made nearly $2 billion at the box office worldwide last year. The Mouse HouseMouse House and Pixar are estimated to have made a profit of $700 million on 2003’s “Finding Nemo”“Finding Nemo” alone.
Given the success rate of Pixar and DreamWorks, it seems foolproof. But industryites are wondering how much animation is too much — especially when all the product is in the same genre (i.e., hip family pics) and competing for the same audience.
“Animation is at the height of its sexiness right now,” says Gotham Group toppertopper Ellen Goldsmith-VeinEllen Goldsmith-Vein, whose company reps a number of animation houses and is producing several toontoon projects.
But with money pouring in and projects piling up, animation vets worry about a repeat of the 1990s boom-and-bust cycle, when Disney hits like “The Lion King”“The Lion King” encouraged other studios to jump into the arena. The results were big-league flops like Fox’s “Titan A.E.”“Titan A.E.” and WB’s “The Iron Giant,” which led those two studios to chalk up big losses as they shuttered their 2-D feature animation units.
“What we’re seeing now resembles what happened in the mid-1990s in 2-D animation,” says Disney feature animation prexyprexy David Stainton. “A lot of the people getting into this business won’t be here in a few years.”
Like his counterparts, Stainton insists his studio — regardless of whether it renews its deal with Pixar — is positioned to avoid calamity.
“I believe the marketplace will expand for good films, but there will definitely be pressure on profit margins,” says Fox animationFox Animation topper Chris Meledandri.
Some disagree that the glut will cause problems. “It’s absurd to think there will be cannibalization,” Katzenberg insists. “ ‘Shark Tale’ and ‘The Incredibles’ and ‘Madagascar’ couldn’t be more different.”
And others think the focus on “toons” is misplaced: They should be considered as individual films.
“A lot of people view animation as a genre, instead of a production technique, and react in ways they never would to live-action movies,” observes Rob MinkoffRob Minkoff, helmer of the “Stuart Little”“Stuart Little” pics and co-director of “Lion King.”
Nevertheless, the stakes are high. DreamWorks, Pixar and their growing field of competitors release just one or two movies per year. One flopflop could be a major blow to a company’s stock or its studio animation division. And CGI is due for a flop.
The 2006 roster includes ParPar’s “Barnyard,” Sony’s “Open Season,” Fox’s “Ice Age 2” and U’s “Curious George” (the only 2-D entry), as well as Pixar’s “Cars” and DreamWorks’ “Over the Hedge” and “Flushed Away.”
There’s also a quickly growing “indie” animation scene. While the budgets are smaller, these houses are spending $30 million or more on their CGI pics — which are just as big a risk for them and crowd the marketplace as much as the majors do.
Studios are approaching — or re-approaching — the market in different ways.
* Pixar pumps out one pic per year, with the 2006 “Cars” marking the end of its current pactpact with Disney. But there have been hints it might boost output to two pics annually. The company’s cash horde allows Pixar to entirely fund its slate after “Cars,” while every studio in town is competing for the chance to take a single-digit distribution fee on its future films.
* DreamWorks makes two movies per year, one in Glendale and the other at its PDI subsid in Northern California.
* Fox plans to make a CG toon every 18 months out of New York-based subsid Blue Sky.
* After shuttering its 2-D operation in Orlando, Disney is essentially starting from scratch, making one new CGI pic per year in Burbank, along with potential sequels to Pixar pics out of a Glendale facility. It also regularly produces direct-to-video sequels to its hit toon pics.
* Sony is aiming at one release every 18 months as it creates a toon unit out of its Imageworks f/xf/x house under the direction of two former DreamWorks execs.
* WB, Par and U have toons on their slate, but pick them up on a selective basis rather than making them inhouse.
* Lucasfilm is opening a 3-D animation studio in Singapore, although it hasn’t announced any projects yet.
Adding to the pressure of the ballooning slate of toons is the cost of labor, which execs admit is starting to rise along with demand. But another factor is helping to keep pay down: Unlike the ’90s toon boom, when there was a limited pool of talent with 2-D skill, there’s now a broader array of animators available.
Salaries range from the $40,000 for newbies at small houses, all the way up to hefty six-figure paychecks for veterans at the biggest places.
“There used to be a very small talent pool and we all learned our skills at Disney,” says former WB animation topper Max Howard, who’s producing indie CGI pic “Igor” for Exodus Film GroupExodus Film Group. “Now artists are coming from lots of different places, including visual effects houses.”
Unlike the live-action world, though, it’s not above-the-line costs that typically drive toon pics to budgets of $120 million or more. Primarily, it’s technology and time.
To keep wowing audiences, studios want to consistently update the software and hardware behind CGI.
Most of all, toons take time — typically three years. And most animators are permanent employees, not freelancers brought on for a project as in live-action, which means they must be paid between projects.
No matter who’s making the movies, there a clear formula for new toons. The old model that started with “The Little Mermaid” — moppetmoppet-oriented musicals full of Broadway-style songs — hit the wall with Mouse House’s 2004 flop “Home on the Range.”
The new model is similar to “Shrek”“Shrek”: a story kids can relate to with ironic jokes parents will appreciate; a wise-cracking sidekick voiced by someone like Ellen DeGeneresEllen DeGeneres or Robin Williams; and lotsa celebrity voices.
In the old days, Disney used unknown actors for films ranging from “Snow White and the Seven Dwarfs” through “Beauty and the Beast.” But vet voiceovervoiceover thesps have largely been shunted aside as today’s studios look for marquee talent.
The $10 million paydays for Mike MyersMike Myers, Cameron DiazCameron Diaz and Eddie Murphy on the “Shrek” sequels are the most famous, but Fox’s “Robots” is significant: Even small cameos were voiced by the likes of Jay Leno, Al Roker and Paul GiamattiPaul Giamatti.
A number of companies are trying to upend the model.
Exodus, Vanguard, Vinton, and Blur are among the animation houses looking for “Shrek” action of their own, but with budgets under $40 million and no dedicated studio support.
“We can just hire people for the term of the project and we finish our productions in two years,” says Vanguard topper Neil Braun. “We don’t have an ‘exploratory process’ like the studios.”
But with budgets much bigger than a typical live-action indieindie, these companies are in many ways taking a bigger risk than the studios. It remains to be seen how their pics will measure up.
Vanguard’s “Valiant,” first out of the gate, recently opened in the U.K. in fourth place and is set for domestic release in August by Disney. Reviews noted the pic’s animation wasn’t as impressive as in big-budget CGI pics.
But while indie animation houses and major studios all prepare to compete in the growing toon space, it’s clear what will separate the winners from the losers.
“There are different ways to do it,” asserts Sony animation co-topper Sandra Rabins, “but it all comes down to whether you have a story worth telling in the medium of animation.”
Last modified: April 18, 2005