Thursday, July 24, 2014

Top Movie Segment

From the Guardian.

Animation tops action as UK's favourite film genre for first time --
Animated films represented more than 20% of the total UK box office receipts in 2013 generating £247m


... Figures from the British Film Institute show British audiences are being drawn to the cinema in their millions for films such as Despicable Me 2, Disney's Frozen, Monsters University and The Croods, all of which were in the top 10 films at the UK box office last year.

Despite only 33 animated films being released last year, compared with 153 comedies, they represented more than 20% of the total UK box office and generated £247m in 2013 – a £100m increase on the previous year. ...

It's pretty much the same story in other spots on the globe, so why not the sceptered isle?

And it explains why production for animated product trends up ... and up ... and up. It's the same story in television animation. We're seeing more shows put into the L.A. production pipeline, even as work goes north to the Free Money in Canada.

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Wednesday, July 23, 2014

Clawing Back

Mr. Vinton might have been leveraged out of his previous studio, but that doesn't mean he's out of the game.

Vinton Entertainment, Inc., the Portland animation studio run by Oscar winner Will Vinton and a partner, announced a co-production deal with Gnosis Moving Pictures for a series of animated features directed by Vinton.

The movies include "The Quest," a previously announced comedy co-written by Vinton and set in outer space that will feature the voice of John Cleese, the comedy legend best known as a founding member of Monty Python. The other pictures include "Jack Hightower," based on a graphic novel from Dark Horse Comics of Milwaukie and featuring a macho secret agent who's been shrunk to the size of a hotdog. "Moby & Dick" is inspired by the classic novel and is about the bond between fathers and sons. "Nicholas" is based on L. Frank Baum's "The Life and Adventures of Santa Claus" and will be produced in a mixture of 3D stop-animation and CGI. ...

I broke bread with a lawyer from Disney today, and we fell to discussing how red hot animation is, how Disney is producing more television cartoons, and (of course) the boffo biz that Frozen has done on seven continents.

Which probably explains why Mr. Vinton is climbing back into the ring. People with money want to be in the world's most profitable film segment, partnered with folks who have a track record making that kind of product.

Will Vinton fills all the requirements: He's run an animation studio; he has a track record that is decades long; he has projects lined up like Boeing airliners on a tarmac. So good luck Will! May all your coming features be mega hits! (Even the Baum project).

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Ancillary Moolah

Seeing your animated feature make large amounts of cash would make any producer or director tingle, but there's other gold buried up in the hills.

... The hit game Despicable Me: Minion Rush reached another important milestone this month, hitting more than 300 million downloads worldwide since its release in June 2013. ...

"The overwhelming popularity of Despicable Me: Minion Rush in its first year in the marketplace speaks to consumers' passion for all things Minion," said Gonzague De Vallois, Senior Vice President Publishing at Gameloft. "The continued evolution of gameplay is very important to us, and we take a lot of pride in creating engaging new content and features for our players." ...

I'm speculating what's even more important is the continuing gusher of cash that comes from having a blockbuster video game spun out of a blockbuster movie.

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The Con

And the L.A. Times lists highlights.

This year’s Comic-Con lineup has no shortage of big names — fan-beloved actors Benedict Cumberbatch and Daniel Radcliffe will journey to the convention for the first time. And the casts of some of the most popular series on television, including HBO’s lavish “Game of Thrones” and AMC’s grisly “The Walking Dead,” will appear. ...

Jackson brings some of the cast of the last of his “Hobbit” trilogy to Hall H on Saturday morning. The Warner Bros. presentation will also feature Andy and Lana Wachowski’s “Jupiter Ascending” and George Miller’s “Mad Max: Fury Road.” ...

A selection of family films will make the trip to San Diego, including the DreamWorks Animation’s “Penguins of Madagascar,” which features the voice talents of Cumberbatch, and “Home,” the human-alien road trip movie starring Rihanna and Jim Parsons. Fox will tout the colorful “The Book of Life,” a fantasy adventure about a conflicted hero named Manolo produced by Guillermo del Toro; Focus will introduce fans to “The Boxtrolls,” the latest stop-motion fantasy from Oregon’s Laika. ...

Last year, Marvel managed the near impossible, winning the Comic-Con showmanship contest with an in-character appearance from English actor Tom Hiddleston, who turned up in Hall H as his alter ego Loki, the mischievous god from the “Thor” films and “The Avengers,” and was received with a thunderous response. It will be interesting to see if the comic book studio can top itself at this year’s Hall H session, which is set for late Saturday afternoon. ...

TAG President Emeritus Tom Sito will be hosting an animation panel in Room 4 on Friday at 5:00, and I'm training down to sit on the dais.

I last attended Comic-Con in 1977; I've heard rumors that the gatherings have changed a bit since then, but I chalk those up to the idle talk of the uninformed. Comi-Con is still held up at the El Cortez, right?

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Financial Literacy

As we near the switchover to Vanguard, we're getting folks coming into the office worried about losing money in the markets (which is understandable). But some of them have little idea how markets (basic math?) works. But apparently they have company:

... Annamaria Lusardi, a professor at the George Washington University School of Business, and Olivia Mitchell, a professor at the Wharton School of the University of Pennsylvania, have just published a comprehensive review of their own and others' work on financial literacy. To anyone who believes people generally understand how their debts and savings work, at least on a basic level, their article will be depressing reading.

Back in 2008, Lusardi and Mitchell designed three questions to test basic financial literacy. How basic? You be the judge:

1. Suppose you had $100 in a savings account and the interest rate was 2 percent per year. After 5 years, how much do you think you would have in the account if you left the money to grow: [more than $102; exactly $102; less than $102; do not know; refuse to answer.]

2. Imagine that the interest rate on your savings account was 1 percent per year and inflation was 2 percent a year. After 1 year, would you be able to buy: [more than, exactly the same as, or less than today with the money in this account; do not know; refuse to answer.]

3. Do you think that the following statement is true or false? "Buying a single company stock usually provides a safer return than a stock mutual fund." [true; false; do not know; refuse to answer.]1

If you're wondering what the answers might be, they are: 1) More than $102. 2) Less than today. 3) False.

Here's how various populations around the globe did with the questions.

... The same questions have since been put to various samples of the U.S. population and to statistically representative groups in other countries. Only in Germany and Switzerland did a small majority (53.2 percent and 50.1 percent, respectively) get all three questions right. In the U.S., that figure was 30.2 percent; in Japan, 27 percent; and in Italy, 24.9 percent (which may go some way toward explaining why that country is perpetually in financial trouble).

In Russia, only 3.7 percent managed to answer all three questions correctly. ...

One of the things I've learned while doing this job is, knowing the basics of finance, investing and economics is very useful if you have a desire to make good decisions.

I've seen too many people make dumb economic decisions because they didn't have the information and knowledge necessary to make smart ones.

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Tuesday, July 22, 2014

League of Legends

The Cinematic. (Suggested as a post by an animation fan way younger than I am).



CG animators, designers, and animation storyboard artists have moved back and forth between feature animation and games for years. (Work is work.) Adding that, Frozen, Tangled and Brave are first cousins of the product on display here.



The featurette up top went online today, and (as I write) closes in on 4,000,000 views.

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Video Game Wage Survey

Per Gamasutra.

... Women in the U.S. game industry earned an average of 86 cents for every dollar that their male counterparts made in 2013. ... Excluding students and educators, average salaries came in at $85,074 for men and $72,882 for women in 2013; the overall pay across the industry of $83,060 represented a decrease of 2 percent compared to 2012. ...

In the six other sectors of employment — business and management, programming and engineering, art and animation, game design, production, and audio — women's salaries ranged from 6 percent less than men's (design) to 31.5 percent less than men (audio, although the survey noted that with a lower sample size in that field, the numbers were more easily skewed by outliers). ...

In programming and engineering — the only sector in which women topped men [in 2012] — the figures took a notable turn in the opposite direction: Male programmers made an average of $93,977 in 2013, 18.5 percent more than women ($79,318). ...

What I'd like to know is: what percentage of employees in the game industry, and what percentage are men? (In Cartoonland, over 80% of the unionized work force is male.)

One encouraging factoid highlighted by Gamasutra. The male/female pay gap in games is narrower than the national average.

Read Gamasutra's reports here.

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Half Human, Half ...

The trades tell us:

Will Ferrell and Adam McKay have come aboard to produce Manimal, Sony Pictures Animation’s live-action/animation hybrid adaptation of the cult favorite 1980s TV show.

Key & Peele exec producers Jay Martel and Ian Roberts are writing the script while Jimmy Miller of Mosaic is also coming on board to produce.

Hardly a favorite if it lasted only eight episodes. But if Ferrell and McKay want to pump new lift into the thing, who are we to complain. It'll create animation jobs.

They'll mostly be in Vancouver, B.C., but hey. Employment. And design and story development should happen at Sony Pictures Animation in Culver City, California.
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Numero Uno

Guess who's topping the charts?

... Rentrak says Frozen topped the charts for the first half of 2014 in digital movie purchases and rentals on VOD and electronic sellthrough. ...

If this were ten years ago, the Disney picture would be selling a bajillion little silver disks. But that part of the biz is so over. Click here to read entire post

Monday, July 21, 2014

Outsourced Away

I know the feeling.

... Japanese animation production company Studio Ghibli could be about to call it a day. The producer of much beloved films such as Spirited Away, My Neighbour Tortoro, Princess Mononoke and Howl's Moving Castle among many, many others is rumoured to be moving towards scaling back its operations, with the biggest casualty of this being ceasing producing feature films.

The move comes on the heels of the retirement of studio co-founder and director of much of its output Hayao Miyazaki from feature films. Though he's toyed with the idea of retirement many times in the past, it appears this time he's serious, with last year's The Wind Rises being his last film. In addition, fellow studio co-founder Toshio Suzuki also stepped down from producing films, moving into the role of studio General Manager.

Now with Ghibli preparing to release its latest film When Marnie Was There, unconfirmed rumours are surfacing that it might be the studio's last. The rising cost of animation production is cited as a leading cause for the move, with Ghibli's dogged stance of maintaining a locally focused production unit, rather than outsourcing animation overseas. ...

Filmation (Lou Scheimer's studio) also prided itself for doing all work in-house years after competitors had sent most departments overseas. The studio went belly up in early 1989, and I was there with lots of others to get thrown into the drink.

Hopefully Studio Ghibli won't go the way of Studio Lou, but animation being what it is, a closure wouldn't surprise me. All studios -- save Walt's place -- are fungible.

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Crab Cakes on a Hostile Sea

So Secretary of State Kerry is back in the Middle East, trying hard to calm things down. But we can take heart from this:

Some things are still worth a smile in the Palestinian territories. This must be the reasoning behind the idea of opening a real-life version of the infamous "Krusty Krab" of Spongebob Squarepants fame in the middle of town.

The themed restaurant based on the Nickelodeon show will open up in Ramallah, which is in the West Bank, according to The Hollywood Reporter. ...

Can't we all just get along? Spongebob wouldn't want it any other way.

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Speaking of Sequels




Paramount, no longer distributing DreamWorks Animation product, links up with another animation studio.

In a first for Spanish productions, Paramount Pictures has signed a deal for worldwide distribution rights to two animated features – Capture the Flag and the sequel to 2012 hit Tad, the Lost Explorer.

Enrique Gato, who helmed the first Tad film, will direct both projects which are to be co-produced by Mediaset Espana’s Telecinco Cinema, Telefonica Studios and Los Rockets AIE, the companies said in a press release.

“This tie-up is an historic landmark in Spanish cinema as it will be the first time that a Hollywood studio agreed to distribute worldwide two Spanish films,” the companies said. ...

The first Tad made $50 million (give or take) in the global marketplace. Not much by Shrek or Frozen standards, but when your movie only costs 6.5 million euros (and I'm guesstimating here; IMDB says the budget was between 5-8 million euros) a good hunk of thart $50 million was pure profit.

Animation is a global industry. Tad #1 never got on my radar until I came across articles detailing its boffo box office (because $50 million is $50,000,000) in Spain, South America and elsewhere.

Because when you're movie costs 6.5 million euros and takes six or seven times that, you're a hero. And one of our fine, American entertainment conglomerates will want to get a piece of that.

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Sunday, July 20, 2014

International Ticket Sales

Lots of animation (of various sorts) making money.

Foreign Weekend Box Office -- (Global Cumes)

Dawn of Apes -- $61,000,000 -- ($241,952,844)

Transformers Extinct -- $81,200,000 -- ($886,256,888)

Planes: Rescue -- $9,000,000 -- ($27,000,000)

How To Train Dragon 2 -- $14,000,000 -- ($386,171,895)

Maleficent -- $8,000,000 -- ($697,167,000)

... “Dawn of the Planet of the Apes” scored $61 million while opening in nearly 30 new markets, including the United Kingdom ($14.6 million), Russia ($9.8 million) and Spain ($4.6 million). ...

And Dragon will nudge over the $400 million marker in the next week.

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Free Fall

It wasn't long ago that Disney direct-to-video animated features were major profit drivers. But that was then.

... Over at least the past five years, Disney's home entertainment operations, which include the entertainment giant's DVD, Blu-ray, and digital movie distribution sales, have seen revenue fall significantly. Between 2009 and 2013, revenue from this part of Disney declined by 37% from $2.76 billion to $1.75 billion, with no signs of improving.

The main driver behind this decline in revenue has been lower units sold as consumers move away from physical and downloaded content in favor of Subscription Video on Demand (SVOD). Between just 2012 and 2013, the company's unit count fell 19%, signaling that the future of Disney's home entertainment business might be in doubt. ...

Which explains, in part, why the Tinkerbell series has wrapped, the second Planes movie went out as a theatrical, and Disney Toon studios have had sizable layoffs over the past several months.

In the eighties, nineties, and early oughts, cassettes and little silver disks made a lot of money. But not so much anymore. Technological change moves on, sweeping older business models before it.

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Adios, Jim

One of the best light comedians ... and better movie actors ... goes away.

Few actors could register disbelief, exasperation or annoyance with more comic subtlety.

James Garner had a way of widening his eyes while the corner of his mouth sagged ever so slightly. Maybe he would swallow once to further make his point.

This portrait of fleeting disquiet could be understood, and identified with, by every member of the audience. Never mind Garner was tall, brawny and, well, movie-star handsome. The persona he perfected was never less than manly, good with his dukes and charming to the ladies, but his heroics were kept human-scale thanks to his gift for the comic turn. He remained one of the people. ...

The 86-year-old Garner, who was found dead of natural causes at his Los Angeles home on Saturday, was adept at drama and action. But he was best known for his low-key, wisecracking style, especially on his hit TV series, "Maverick" and "The Rockford Files." ...

He was a giant presence in live-action t.v. and theatrical features, but he also did voice work in animation, playing God in God, the Devil and Bob, Dorron in Battle for Terra and Commander Lyle Tiberious Rourke in Atlantis: The Lost Empire.

I interviewed him for a magazine article forty years ago, and he was wry and forthcoming about his career to that point, explaining his early years of heavy labor at Warner Bros., why he had to get out of his contract, and why it was such a pleasure to come to work every day on the Rockford Files ("must see" television in its day).

I will miss him a lot.

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Azaria's New Gig

The Simpsons's Hank Azaria commences work on another Fox animated show.

... Ahead of its TCA presentation today, Fox announced that the Emmy winner will play the lead character on Bordertown, the new animated comedy from Family Guy’s Mark Hentemann and Seth MacFarlane. It has not been scheduled yet, but given how hot-button the immigration issue is at the south border, Fox may want to bring the show on sooner rather than later. ...

In actual fact, this casting has been known to the BT crew for a while now, but Fox was having people keep the news under their collective hats.

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Saturday, July 19, 2014

Unionization? Of Employees?

This is great:

The future of college sports is now in the hands of a federal judge in Oakland after a nearly three week trial in June.

If amateur athletes prevail in an antitrust lawsuit claiming the NCAA is a cartel that restrains them from licensing their names and images, U.S. District Judge Claudia Wilken could issue sweeping orders impacting such TV broadcasters as CBS, Fox and NBC Universal that collectively spend more than two billion dollars on college football and basketball rights each year.

The athletes want to be paid for their role in a business that generates substantial revenue for NCAA schools but nothing except scholarships for its athletes thanks to "amateurism" policies that date to 1906. As conferences ink huge TV deals and top coaches command $7 million salaries, the movement to pay players has gained support from NFL legends past (Joe Theismann) and present (Adrian Peterson).

Imagine that. College students' on-field performances earn colleges and broadcast networks Big Dough. But it gets better. ...

Unionization would probably clear up the question of whether broadcasters own rights to on-field performances. This is an issue addressed indirectly in the O'Bannon case after Judge Wilken raised the specter they might not. Last April, she ruled, "Whether Division I student-athletes hold any ownership rights in their athletic performances does not depend on the scope of broadcasters’ First Amendment rights but, rather, on whether the student-athletes themselves validly transferred their rights of publicity to another party."

The broadcasters were so troubled by the implications of this statement that they asked to brief the judge on why the NCAA should be given an opportunity to appeal. The judge allowed the trial to move ahead anyway, and as a possible outcome, the judge could bar the NCAA from forcing its athletes to sign waivers. ...

See, if colleges stick to the fiction that college athletes are unpaid "amateurs", they they can't be employees. And if they're not employees, then colleges (and broadcasters) can't own rights to the athletes' performances/images as a "work for hire."

Because they haven't, you see, been hired. Quite delicious, methinks. The whole "employees of companies don't own rights to their work. ..." comes back to bite colleges and big-time broadcasters on the backside.

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TAG 401(k) Factoids

Last week the TAG 401(k) trustees had their summer meeting. A few points of interest for Plan participants:

Assets in TAG 401(k) Plan -- $220,551,015

Active Participants -- 2,359

2nd Quarter Contributions -- $3,264,892

Average Participant Balance -- $90,767 ...

The Animation Guild 401(k) Savings Plan came into existence in Spring 1995, when Disney's Michael Eisner agreed the company could do a 401(k) program with its unionized animation staff.

Until then, it had been "no, no, NO!" from the Mouse's middle management. That ended when the company CEO said "fine, okay."

And big surprise. Once Disney agreed to a 401(k), most of the other companies with which TAG had contracts -- Warner Bros., DreamWorks Animation, Cartoon Network, etc -- came aboard as well.

The Plan has grown steadily since '95; we're now on the cusp of our biggest change in almost a decade: On August 1st, Plan administration switches from Mass Mutual to Vanguard, the largest, most cost efficient mutual fund company in the country. With the change will come a new lineup of investment choices:

TAG 401(k) Plan Funds Available After August 1st

Vanguard Target Retirement 2060 Fund
Vanguard Target Retirement 2055 Fund
Vanguard Target Retirement 2050 Fund
Vanguard Target Retirement 2045 Fund
Vanguard Target Retirement 2040 Fund
Vanguard Target Retirement 2035 Fund
Vanguard Target Retirement 2030 Fund
Vanguard Target Retirement 2025 Fund
Vanguard Target Retirement 2020 Fund
Vanguard Target Retirement 2015 Fund
Vanguard Target Retirement 2010 Fund
Vanguard Target Retirement Income Fund

Vanguard Retirement Savings Trust III
Western Asset Core Plus Bond Fund Class I
DFA Five-Year Global Fixed Income Portfolio Class Institutional
American Beacon Large Cap Value Fund Institutional Class
Vanguard Institutional Index Fund Institutional Shares
Principal LargeCap Growth Fund Institutional Class
Vanguard Mid-Cap Index Fund Institutional Shares
MassMutual Select Mid Cap Growth Equity Fund II Class I
DFA US Targeted Value Portfolio
Vanguard Small-Cap Index Fund Institutional Shares
American Funds EuroPacific Growth Fund Class R-6
DFA Emerging Markets Portfolio Institutional Class Shares
DFA International Small Company Portfolio
Vanguard Total International Stock Index Fund
Vanguard Total Bond Market Index Fund Admiral Shares

We've increased the number of bond and stock funds, and doubled the number of Target Date funds. The intent is to lower costs while broadening choices. Some old Mass Mutual funds will be departing, but viable alternatives will be out there.

I've been associated with the Plan since its beginning, and -- I'll admit it -- I feel a little paternalistic. I sometimes encounter members who say: There's no match, so I have no interest in putting money into it." But I think that's short-sighted. Working members are already in a defined contribution plan, called the Individual Account Plan, that's paid for by the studios. The TAG 401(k) Plan is a good supplement to the two industry-wide pension plans members are automatically enrolled in.

Added to which, the Guild's 401(k) Plan allows members to shelter income from state and federal taxes. (There are a number of participants who have a half million dollars in the two plans.)

It's tough saving enough money for retirement, I get that. But when you have the chance to be part of three separate pension plans, two paid for by your employer and the other sheltering your income from taxes, grab on to all of it.

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Domestic B. O.

Planes earns an "A" Cinemascore, but doesn't make the dean's list money-wise.

1). Dawn of the Planet of the Apes (FOX), 3,969 theaters (+2) / $10.45M Friday / 3-day est. cume: $35M (-52%) / Total est. cume: $138M / Wk 2

2). The Purge: Anarchy (UNI), 2,805 theaters / $12.98M Fri. / 3-day cume: $30M to $31M+ / Wk1

3). Planes: Fire & Rescue (DIS), 3,826 theaters / $6.29M Fri. / 3-day cume: $17.5M to $18.4M / Wk 1

4). Sex Tape (SONY), 3,062 theaters / $5.6M Fri. / 3-day cume: $14.3M to $16M / Wk 1

5). Transformers: Age of Extinction (PAR), 3,224 theaters (-689) / $2.74M Fri. / 3-day cume: $9M (-45%) / Total est. cume: $228M / Wk 4

6). Tammy (WB), 3,402 theaters (-63) / $2.2M Fri. / 3-day cume: $7M (-44%) / Total cume: $70.7M to $72M / Wk 3

7). 22 Jump Street (SONY), 2,229 theaters (-582) / $1.4M Fri. / 3-day cume: $4.5M (-31%)/ Total cume: $178M to $181M+ / Wk 6

8). How to Train Your Dragon 2 (FOX), 2,169 theaters (-716) / $1M Fri. / 3-day cume: $3.5M (-40%) / Total cume: $160M+ / Wk 6

9/10). Earth to Echo (REL), 2,450 theaters (-780) / $980K to $1M Fri. / 3-day cume: $3M+ (-43%) / Total cume: $31.8M to $32.8M / Wk 3

Maleficent (DIS), 1,541 theaters (-536) / $954K Fri. / 3-day cume: $3M+ (-26%) / Total cume: $229M / Wk 8 ...

Meanwhile, as How To Train Your Dragon Deux reaches (by Sunday) $160 million, market analysts rate it a failure: "Shoulda done $220 million!"

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Friday, July 18, 2014

The More Things Change ...


Etcetera. (From my interview with animator/director Don Lusk, who is now 100 years old):

... Steve Hulett: How did you happen to come to the Disney Studio in ’33?

Don Lusk: I was out looking for work. I’d taken set design and costume design, and all the studios were laying people off. And I was flying home after my last hope, and I was on Hyperion, on my way back to Glendale. And I saw the sign “Mickey Mouse and Silly Symphonies.” So I jammed on the brakes, parked at the curb, and went into the entry office.

And who was there but Mary Flanigan. She was a great gal. She ended up running the cafeteria at the new studio. She was so nice to me, because I didn’t have any cartoons in my portfolio. I had gone to Chouinards, and Don Graham [one of Chouinard’s teachers] helped Ben Sharpsteen go over our portfolios. Don had been one of my favorite instructors, and he recognized my name and put me on tryout for two weeks.

But after I was there for four days, they put me on the payroll.

Steve Hulett: So you worked for free for four days.

Don Lusk: Yeah. And it could have been two weeks. ...

If you follow things around here you know that this small piece is from a longer audio interview I did with Mr. Lusk eight or nine months ago. But I was transcribing the audio last week and this (again) jumped out at me.

Today, eighty years after Don Lusk's free tryout took place, we face the same conundrums in animation studios that were encountered way back when. Only now, cartoon managers don't have artists come in and sit at a desk and show off their chops for no money. It's done by phone and over the internet.

The applicant is given model sheets, several panels of a storyboard, and one or maybe four pages of a script. And told to board away, and "have fun with it."

And the work usually takes anywhere from three to six days to complete. Much sweat and nervous energy is expended, and at the end of the test, a director or committee reviews it and makes a judgment about hiring the applicant or not.

We've made some progress since 1933, but this isn't an area that envelopes much of it.

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DreamWorks on a High Wire


From the dour Seeking Alpha.

... Dreamworks is attempting to diversify its way into becoming a conglomerate, with a wide variety of ways to leverage its content, including several deals with China.

The problem it faces, at very least in the short term, is it has dropped the ball on its film business, whose performance is the key to it being in a strong position to take advantage of various future initiatives. ...

Dragon 2 has vastly underperformed expectations, and it will have an impact on the share price of the company. ... [T]he benchmark for sequels was no lower than $600 million in the past. Dragon 2 will come nowhere near that low side of past performance. Not only will that eventually weigh on the immediate performance of the company, but it will result in a much lower number for all of 2014, which is now likely to come in at about $750 million in revenue. ...

Starting an entertainment company from scratch is always a dicey thing. It's not 1922 anymore, and there a lot of gib, well-established competitors. A dozen years ago, there was not a lot of heavy competition in the animated feature sector of the economy. Now there is. In this high risk environment, smaller companies have to move forward constantly or perish.

From scuttlebutt around the campfire, Jeffrey K.'s original strategy was to build an animation company that rivalled Pixar's success, and sell the joint lock, stock and work station for a Pixar-sized number. But then the 2008-2009 economic meltdown, and that settled that.

Now the plan appears to be to diversify and build an entertainment conglomerate that lasts. I hope fervently the boys and girls at DreamWorks Animation can do it. Box office for features now in the pipeline will probably aid in discovering if that happens.

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Thursday, July 17, 2014

Biggest Company in 2114

Seeking Alpha, a fine business/investing website, has this:

... My bold prediction: In 2114, the largest company in the US, or anywhere else on the planet for that matter, will be the Walt Disney Company (DIS). You scoff. Disney - a cartoon company? Really? So why will Walt Disney be the one that not only survives the next 100 years but also thrives? Because, to simplify it to its investing essence, and in the ironic words of Bill Gates: 'Content Is King.'

If you have been to Disney World in Florida recently, and especially if you have not, you may be amazed to discover that a silly cartoon character created in 1928 by the name Mickey Mouse is doing pretty well for himself. What's more amazing is that Mickey does not appear to have aged at all in his 80+ years, and still draws big crowds.

More importantly, Disney has been able to create worlds where characters like Mickey blend seamlessly with Disney's latest and greatest 'Elsa and Anna' characters from "Frozen," plus scores of other notables including Snow White and Cinderella. Disney has the unique ability to generate new content that has a nearly infinite shelf life. There have been a few duds, and not everything Disney touches turns to gold, although it's difficult to come up with anything recently that has not. Every one of Disney's business lines, including especially ESPN, has compelling growth projections, and Disney's content knows virtually no borders. Every company goes through ups and downs, and none is immune to the vicissitudes of life, but Disney by almost any measure is an unstoppable machine. ...

Doing a hundred-year prediction is a fool's errand.

It's a long time ago, but I remember when Disney was teetering on the edge of catastrophe. The company had just launched a cheapie cable channel that was gasping for air. It's live-action comedies were industry punch-lines (and not in a positive way). And corporate raiders were keen on tearing WDP apart because it was (at that point) a big real estate holding company with a movie studio and minor t.v. assets. They figured it was worth more in large, separate chunks than as a single corporation. (And they might have been right.)

Thirty years on, Diz Co. is the Berkshire Hathaway of entertainment conglomerates. But it doesn't take a huge imagination to project some of Disney's core businesses going awry. A century is a long time, and my crystal ball is cloudy.

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TeeVee Pilots

The Diz TVA press release sayeth:

Disney Television Animation announced today production on three pilots and new short-form series from Aaron Springer, Jhonen Vasquez and Jenny Goldberg, Jesse LeDoux and Matt Olsen, and Ryan Quincy; Extending its overall development deal with "Phineas and Ferb" co-creator Dan Povenmire; and a "Haunted Mansion" Special.

"Haunted Mansion," is a special for Disney Channel and Disney XD inspired by the popular Disney Parks attraction. Legendary horror genre artist and children's book illustrator Gris Grimly ("Gris Grimly's Wicked Nursery Rhymes") is attached to executive produce and art direct with Scott Peterson executive producing, story editing and writing and Joshua Pruett consulting producing and writing, both of "Phineas and Ferb." ...

New pilots in production are: "Billy Dilley's Super Duper Subterranean Summer"; "Very Important House"; "Douglas Furs"; "Future-Worm!" ...

At other studios, Cartoon Network staffers tell me that Clarence will go on and that the studio is searching for a voice double for Clarence. So the show will continue ... but without Skyler Page.

There are new CN shows in work, and Power Puff Girls are being dusted off and brought back for new episodes. (This comes about because the show is doing well in foreign venues and there's a demand for new episodes. There's speculation that there will be design tweaks to the girls, but that remains to be seen.)

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Wednesday, July 16, 2014

Of Wages and Wage Surveys

The last few days via e-mail and face-to-face studio visits I've been asked

1) Is there an on-going campaign by studios to tamp down salaries?

2) Do studios purposely misclassify employees in order to lower wages?

3) Will there be an punishment for executives who were part of the "wage-theft cartel"?
...

Regarding 1): Yup, there's a concerted effort to lower animation employees's weekly checks. This has been done by laying off higher-salaried employees, renegotiating personal service contracts at par (i.e., minimal or no dollar increases in salaries), offshoring more work to Canada where the government is giving away free money, or China/India, where pay packets are much smaller.

Oh. And studios working to avoid bidding wars for artists' services. As one big-studio employee told me yesterday:

A couple years ago I was talking to a recruiter from Animal Logic in Australia, who told me they had a "Gentlemen's Agreement" not to hire away each other's employees unless they had talked to one another first.

"Gentlemen's Agreement." I couldn't tell you why the guy was so upfront with me about it. Maybe it's because he's Australian." ...

The drive to roll back costs has been vigorously pursued by the entertainment conglomerates since early 2008, when the Writers Guild strike prompted the studios to eliminated many rich writer-producer deals and pare back over scale contracts. (And journey ctors have suffered cuts in pay for years; in television "scale plus 10%" became the norm -- and notorious -- for actors and actresses guest starring in television series.)

In animation, TAG had much tougher negotiations. Over two contract cycles, the AMPTP (Alliance of Motion Picture and Television Producers) made serious pushes to cut contract salary increases by a third. (The Alliance was successful in 2009; unsuccessful in 2012.)

Regarding 2): Studios don't blatantly misclassify new hires, but they do push the envelope. Keeping employees in lower cost categories -- Animator/Modeler 5, Animator/Modeler 4 -- is a favored strategy. Newcomers are held in "trainee" and "apprentice" classifications longer.

Regarding 3): This is one's easy. Nobody will be punished (as in go to the pen. Or be fined.) Few will even get slapped on the wrist. The studios will have to pay settlements for lawsuits, but this will amount to chicken feed.

In class action lawsuits, there will be individual settlements of a few thousand dollars. (Millions in toto.) The only negative for high executives will be that their reputations could sag a bit. But they'll still be multi-millionaires, won't they? So how much will they care?

Not much.

Regarding the wage survey: The total responses have climbed to almost 23%. We are shooting for better than 25%. If you haven't yet filled out a digital or paper survey form, please do so as quickly as possible. We won't be keeping the window open much beyond August 1st.

Add On: * I tweaked the last paragraph a wee bit to clarify what I meant. A class action lawsuit could well be in the millions, but individuals will get a few to several thousand dollars. Big whoop. Nobody goes to the big house. Nobody gets fined. I note that some tweeters disagree with this.

Maybe I'm too cynical for my own good. I hope so.


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Tuesday, July 15, 2014

Under-Performing?

Animation box office. Not like it was in the good old days (2013).

‘Planes 2' Taking Flight in Bummer Year for Animated Movies at Box Office

With “Minions” and “Good Dinosaur” pushed, and “Dragon” and “Rio” sequels failing to outstrip the originals, there's a post-”Frozen” hangover
...

Like the overall box office, which is running about 5 percent behind last year thanks to a very soft summer, this year's animated movies suffer by comparison to the record-breaking 2013. ...

It's probably a numerology thing. 13 is just more powerful than dull, icky 14.

In point of fact, it's the movies. Princess features, expertly done, are more potent at the box office than remakes of Jay Ward television shows. It's really pretty simple: When you create a movie people don't much want to see, they don't go see it.

Even worked that way when I was a kid.

Add On: But seriously. How can any media outlet claim that 2014 animated features are under-performing when this:

Transformers: Age of Extinction took command of the foreign box office this weekend for the third week in a row. The Michael Bay sequel collected $102 million this week, helping to reach a grand total of $752.5 million earned from 50 national markets.

Chinese audiences are credited for the robust results. The People’s Republic makes up $262.6 million of the worldwide total — the highest amount ever earned by a foreign release in the country.

Second place went to DreamWorks Animation’s How to Train Your Dragon 2 with $34.4 million from 62 markets.

Dawn of the Planet of the Apes came third by raking in $31.1 million from 30 territories, while also leading the U.S. box office with an estimated $73 million.

Squint your eyes a little, and animated features finished 1,2,3 at the global box office. What is Transformers, after all, but a big cartoon?

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Woes


First, an under-performing Western (is there any other kind in the modern age?), and now another unfortunate thing.

... “Family Guy” honcho has been hit with a lawsuit by a production company that claims his 2012 big-screen comedy “Ted” was bases on a web series. ...

“Charlie and Ted possess the same physical attributes, including the general look and feel of each character,” the lawsuit reads.

The suit goes so far as to point out online posts from both characters that expounded on similar topics, such as Lindsay Lohan, defecation and Winnie the Pooh.


I don't think you can trademark or copyright excrement.

Ted is a big Universal franchise. I bet the company will defend against this lawsuit right up through the appellate courts.

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The Trailer

... for the movie following Frozen.




If I were agile ... and on the internet more, I would have put this up earlier.

But I'm not, so here it is now 9after everybody and their rich uncle has already rolled it out). Cute movie. We'll see what kind of grosses it rakes in during the upcoming holiday season.

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Monday, July 14, 2014

Moving the Franchise

Universal/Illumination Entertainment is (apparently) moving one of its tent poles.

The Minion Movie ("Despicable Me"'s spinoff) has been moved from the original Dec. 19, 2014 to July 10 next year.

Universal's decision to move the movie means that it'll have no animated film to release this year, a first since 2009.

The studio did not give any information as to why they moved Despicable Me spinoff 'The Minions movie' to 2015. However, someone close to the company revealed that Universal is determined in repeating its success with "Despicable Me" and "Despicable Me 2," both were released on July. ...

What I know about animated features? If a company's moving a release window, there's a solid chance that story retooling is part of the reason. It certainly was the case for DWA's The Croods. And for Pixar's the Good Dinosaur.

Even back in the paleolithic age of theatrical animation, when three-strip Technicolor and the multi-lane camera were cutting edge technologies, Walt Disney Productions had to delay Pinocchio due to story issue, thereby making Gulliver's Travels America's second released animated feature.
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Sunday, July 13, 2014

Double Meanings

It's been an interesting week for the animation community. Certainly interesting enough to give this Forbes piece from two days ago a deeper (and parallel) meaning.

Why Pixar President Ed Catmull's New Book Is One Of The Best Reads On Creative Leadership

The last chapter titled “Thoughts for Managing a Creative Culture,” offers a master class in creative leadership. From managing fear and failure in an organization to protecting new ideas and imposing productive limits, these are 33 gems. ...

Catmull’s open and supportive leadership, evidenced throughout the book, has surely been a crucial factor in the success of this ongoing collaboration of different kinds of workers. But his account, which consistently celebrates Steve Jobs and John Lasseter (among others), underscores how leadership among partners with complementary if distinct capabilities and even creative backgrounds can add value to a creative organization. ...

Reading Creativity, Inc., one can easily appreciate Catmull’s gifts as a leader whose style – deft, open, humble, caring, trusting, purposeful – has built, shaped and sustained an exceptional creative culture. ...

After the Pando Daily articles, "open, humble, caring" and "trusting" aren't the words that immediately spring to many people's minds.

But purposeful? Yeah, I would definitely go with purposeful.
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Your Worldwide Box Office

Animated feature results across the globe.

Foreign Weekend Box Office -- (World Totals)

Transformers Umpty-Ump -- $102,000,000 -- (752,531,298)

Dawn of Apes -- $31,100,000 -- ($104,100,000)

How To Train Your Dragon 2 -- $34,400,000 -- ($351,068,361)

Maleficent -- $13,400,000 -- ($668,994,000)

Rio 2 -- $2,600,000 -- ($489,634,812) ...

As one of the digital trade papers tells us:

... “How to Train Your Dragon 2” will cross $200 million in overseas grosses sometime Sunday, after tacking on $34 million from 62 markets this weekend. A powerful $15.9 million debut in the U.K. was the highlight for the DreamWorks Animation family tale, which has taken in more than $351 million worldwide. ...

Hulett still thinks Dragons will approach the $200 million marker in the domestic market, and do 60% of its business overseas. (Hulett is sometimes a bad prognosticator.)

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Board Approved

We're talking about the new SAG-AFTRA contract.

SAG-AFTRA's national board late Saturday approved the union's new primetime TV and movie contract with Hollywood producers.

The proposed three-year deal with the Alliance of Motion Picture and Television Producers now goes to the performers union's 165,000 members for ratification. ...

The agreement follows deals between Hollywood's producers and the unions representing directors and writers, so if SAG-AFTRA's membership approves the new pact, all of the industry's creative unions will be under contract through 2017.

What we're looking at is the contours that will heavily influence the IATSE Basic Agreement, slated to be negotiated next Spring, and the Animation Guild contract that will presumably follow soon after.

The IA will commence early planning in September and October; the Animation Guild will be tracking along with them.

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Saturday, July 12, 2014

Wages

We are now, as of Friday, up to a 19% return for the annual wage survey. This doesn't sound like an excitingly high number, but it's in line with tracking of survey responses in years past. So gentle reminder: If you're a member, and you haven't yet gotten your information back to us, pick up a pen and fill out the paper form ... or go to the website and DO IT NOW!

http://animationguild.org/wage-survey-2014/

And while we're on the topic of wages, there have been inquiries about the recent new of California's wage suppression and the wage cartel lead by the late Mr. Jobs and associates, and what TAG intends to do about it. And there is this ...

We've been in communication with some of the legal players in the ongoing lawsuits and court proceedings, and we'll be talking about action and remedies for individuals impacted by these latest corporate shenanigans at the Animation Guild's July 29th membership meeting.

And in case you're hazy about the location of said meeting, it's at

1105 N. Hollywood Way
Burbank, California 91505


Mark it on your calendar and BE THERE.

Add On: Don Hahn, who worked in Disney Feature Animation for decades and produced a few Disney movies with which you might be familiar, linked to this on his Facebook page seven hours ago.

Interesting, no?

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American Box Office

The animated (and animated-themed) features are holding up well.

WEEKEND TOP TEN

1). Dawn of the Planet of the Apes (FOX), 3,967 theaters / $27.8M Friday / 3-day cume: $70M+ / Wk 1

2). Transformers: Age of Extinction (PAR), 3,913 theaters (-320) / $4.9M Fri. (-58%) / 3-day est. cume: $16M to $17M+ (-55%) / Total est. cume: $208.5M / Wk 3

3). Tammy (WB), 3,465 theaters (0) / $4M Fri. / 3-day cume: $12.8M to $13.1M (-39%) / Total cume: $57.4M / Wk 2

4). 22 Jump Street (SONY), 2,811 theaters (-513) / $2M Fri. / 3-day cume: $6.27M (-44%)/ Total cume: $171.4M / Wk 5

5). Earth to Echo (REL), 3,230 theaters (0) / $1.75M Fri. / 3-day cume: $5.75M (-30%) / Total cume: $24.7M / Wk 2

6). How to Train Your Dragon 2 (FOX), 2,885 theaters (-412) / $1.76M Fri. / 3-day cume: $5.68M / Total cume: $151.85M (-37%) / Wk 5

7). Deliver Us From Evil (SONY), 3,049 theaters (0) / $1.56M Fri. / 3-day cume: $4.8M (-50%) / Total cume: $25.1M / Wk 2

8). Maleficent (DIS), 2,077 theaters (-312) / $1.2M Fri. / 3-day cume: $4M (-34%) / Total cume: $221.85M / Wk 7

9). Begin Again (TWC), 939 theaters (+764) / $825K Fri. / 3-day cume: $2.98M (+138%) / Per screen: $3,180 / Total cume: $5.3M / Wk 3

10). Jersey Boys (WB) 1,968 theaters (-662) / $709K Fri. / 3-day cume: $2.4M (-53%) / Total cume: $41.6M / Wk 4

As The Wrap tells us:

... Another fifth-week holdover, “How To Train Your Dragon 2,” was sixth with $1.7 million Friday and will come in at around $5.6 for the weekend, which will lift the domestic total for the Fox-distributed Dreamworks Animation kids film to more than $150 million. ...

Dragon is now at three times its opening weekend box office, and will push on from here. I still think it will get within hailing distance of $200 million by Fall, but I guess it all depends on how you define "hailing distance."

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Friday, July 11, 2014

Newer Development

From a couple of days back:

Sony Pictures Animation is developing a stop-motion “Superbago” movie with “Robot Chicken” exec producers/animators John Harvatine and Eric Towner directing.

Gotham Group’s Ellen Goldsmith-Vein, “Napoleon Dynamite” director Jared Hess and Eric Robinson are producing.

Hess, Ricky Blitt, Hubbel Palmer and Chris Bowman are writing “Superbago,” centering on a pair of superhero wannabes. Towner told Variety that “Superbago” has offbeat origins.

“This project started with a couple of buddies buying a ’73 Winnebago off Craigslist and making a short film near and dear to our hearts,” he said. “We found a super supportive home in Sony Pictures Animation and couldn’t be more thrilled with the talented team surrounding the project.” ...

So if they're doing it in Stop Mo, maybe it won't be shipped to Vancouver, where all Sony Imageworks computer stations now live.

Or maybe I'm being over-hopeful, and the stop motion will get the same free money as the CG. And so will end up in British Columbia with all the rest of Imageworks' production.

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TAG 401k Switch to Vanguard meetings

The Animation Guild is holding TAG 401k Plan informational meetings about the transition from MassMutual to Vanguard as the home to our 401k Plan investments. This will be an opportunity to learn about the new investment options available and ask questions about the Plan. Steve Hulett and Vanguard will be at the meetings to answer your questions.

Dates & Locations:

Wednesday, July 16th
7:00 pm
The Animation Guild Meeting Hall
1105 North Hollywood Way, Burbank 91205
Open to ALL 401k Plan participants!

Thursday, July 24th
11:30 am - 12:30 pm and 1:00 pm - 2:00 pm
DreamWorks Animation, Campanile Theater
Great for current Dreamworks employees

Friday, July 25th
11:15 am – 12:15 pm and 12:45 pm – 1:45 pm
Disney Feature Animation building, conference room 1300
Great for current Disney Feature employees

Tuesday, July 29th
7:00 pm
Animation Guild General Membership Meeting
1105 North Hollywood Way, Burbank 91205
Open to ALL TAG members!

Learn about:
  • What funds will be available.
  • What will happen during the move to Vanguard.
  • When you can look at the Vanguard website.
  • How to set-up where your money will be invested before the money is moved.
  • When will access to your investments be restricted before and after the move (a “Black-out” period.)
  • When can you start moving your money around at Vanguard.


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Peaceful Negotiations?


One of our fine trade papers analyzes Hollywood's labor talks to date.

Why Hollywood Producers and Labor Guilds Chose Peace Instead of War

Surging demand for content in cable, premium streaming TV markets was a driving force in the new deals

Hollywood producers and the three major creative guilds chose to make peace rather than war in bargaining this year for a simple reason – with the demand for cable and premium streaming TV content booming, it made financial sense. ...

“The economy is back to a degree, but not all the way and there is some real uncertainty out there, and I think all the sides were smart enough to realize that,” said Alan Brunswick, who served as legal counsel for the AMPTP in previous negotiations. “I also think they remembered how disastrous a work stoppage, or even the threat of it, could be, and very much wanted to avoid anything at all like that.” ...

"Economy is back to a degree"? Entertainment conglomerates' stock prices are at all-time highs, and profits are surging.

But ... whatever.

I've participated in contract talks for a while, and these things run in cycles. When the tilted playing field becomes almost a cliff, Hollywood's unions and guilds revolt. Pressures build up, and restive memberships elect militant leaders who lead the WGA ... or SAG ... to a strike. Then the pendulum swings the other way and moderates push the hard-chargers out.

Then, of course, there's the 21st century reality that entertainment unions and movie/television producers are no longer evenly matched. The guilds, no matter how big they might be, are mere mosquitoes against the behemoths they face across the negotiating table. The knowledge that The Producers, with billions of dollars in reserve, can outlast Hollywood's wage slaves always hovers like a storm cloud over contract talks.

Even so, it's in both sides interest to reach a deal and avoid long work stoppages that, long-term, hurt everybody. (And truth be told: the SAG-AFTRA talks went on for frigging weeks, and I heard lots of pissing and moaning from corporate lawyers who had to sit through them. So I'm not sure the negotiations were as "smooth" as this article implies.)

The ancient adage still holds sway: "You get, in the end, what you have the leverage to get."

Add On: The fight between labor and management never actually ends:

The Writers’ Guild of America's fight to unionize reality TV writers progressed on Friday, when employees at Original Media voted to join the guild by a 42-9 margin in an election held by the National Labor Relations Board.

Original Media, a subsidiary of Endemol USA, produces shows such as “Miami Ink” and its spinoffs, History Channel's “Swamp People,” Discovery's “Storm Chasers” and Spike's “Ink Master.” ...

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