Tuesday, September 30, 2008

The General Membership Meeting

Most of tonight's membership meeting was pretty humdrum. I rattled off my biz rep's report ("There's more work on the theatrical side of the business than the television side" ... "We've signed a contract with Eisner's company" ... "There's been a lot of anxiety about the performance of the 401(k) Plan" ...). Members voted approval on the budget for the annual TAG Christmas Party.

But then the anger started.

"Some studios require you to sign over rights to original work when you submit your portfolio!"

"Studios have no right to require long tests without any pay!"

"Studios keep requiring tests of job applicants, even when they don't plan to hire anybody."

President Koch and I said that

1) If a company is forcing artists to assign their work to the company when artists submit a portfolio to get a job, we need the specifics so we can challenge the practice.

2) We've been making issues of long tests for years. (No problem with shorter tests to show a portfolio sample is the work of the artist. But the week-long monsters? Way off the charts.) And we'll be making an issue of long tests at our next contract adjustment meeting.

3) We've fought the practice of blanket tests. If there are tests given for jobs that have already been offered to a staffer, why bother? It just ticks off applicants when they find out the test they worked hard on was close to pointless from the get-go, since one of the in-house artists had the inside track all along. (Tests too often become a crutch, rather than a tool.)

That was part of the evening. The rest of it was a panel on "The Internet for Animators."

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401(k) Plan Q&A about the economic situation

Over the last few days, I've gotten button-holed in studios, and received phone calls in the office: "Is the TAG 401(k) Plan self-destructing?"

The answer is, "No."

What's happening is a large decrease in value for 401(k) plan accounts that happen to be in stocks because ... putting it mildly ... stocks have been up and down. (Maybe you've noticed.)

TAG 401(k) Plan's stock accounts have been choppy, but anybody invested in PIMCO Total Return or Babson Capital Premiere Inflation-Protected Bond have done pretty well. I've been doing lots of enrollment and information meetings of late, and what I tell people is:

"Stock market volatility is a reality of life, and if you can't take the whip-saw motion of the roller-coaster, be more heavily invested in bonds."

Below are some relevant answers to questions about TAG's 401(k) Plan as provided by the Plan's Administrator Mass Mutual. Read through them, and if you have any questions after you're through, feel free to put them in comments below. I'll respond when I come up for air.

-- Steve Hulett

Mass Mutual logo

From Mass Mutual; available in PDF format.

MassMutual -- Standing Strong

This report provides information regarding MassMutual's financial stature in light of recent market events affecting a variety of financial firms.

1. How do the recent events and challenges associated with other financial services firms, e.g. Lehman Brothers, AIG, Freddie Mac, Fannie Mae, and Merrill Lynch, impact my account?

  • Simply put, if any of the equity or fixed income investment options you selected for your retirement plan account hold or did hold the securities of any companies that have struggled in this environment, those investment options likely declined.
  • Large companies like these make up a notable percentage of their "sector" or industry category, so many mutual funds and other similar investment options that invest in this sector own or did own these companies. As a result, many mutual funds and other similar investment options declined.
  • Most investment options offered through your retirement plan are diversified and invest in a large number of companies, which can limit the negative impact of a few bad performers.
  • Additionally, mutual funds and other similar investments are managed by experts in their field and operate in the best interest of their investors.

2. Is MassMutual at risk of financial failure in this turbulent economic and market environment?

MassMutual should not be compared to the financial firms that have recently been in news headlines because of bankruptcy or governmental intervention. Following are some reasons why:

  • For many years, MassMutual has managed its corporate investments as a broadly diversified investment portfolio with high quality assets and with strict limits on holdings of banks and finance and leasing companies. Our exposure to these industries makes up less than 2% of the $82 billion in our general investment account.
  • We do not depend on short-term financing to operate our business. In this way we are very different than banks and investment banks, which have greater vulnerability to changes in the availability of credit.
  • MassMutual maintains a strong cash position in keeping with its commitment to clients and, consequently, we are not dependent on short-term financing. Cash flow and liquidity needs are routinely monitored as part of the investment management process.

3. Is the Diversified Bond SAGIC Account insured? Can I ever lose my money invested in these products? What are the holdings in these investments?

The Diversified Bond SAGIC Account is not "insured," but MassMutual does provide fixed-rate guarantees, similar in some respects to a bank's certificate of deposit, or CD. Losing money invested in these investments while the contract is in effect is unlikely since MassMutual provides for the principal guarantees and due to the product features explained in the chart below:

Product Feature SAGIC Diversified Bond
Minimum Guaranteed Rate of Return 0% minimum
Credit Quality of Portfolio AA (Quality Investment Grade)
Holdings Fixed income securities including corporate, mortgage backed, and government and agency bonds. Diversified Bond may have a higher allocation to below investment-grade bonds.

Additionally, please keep in mind that:

  • While the underlying fixed income portfolios of these products have had some exposure to troubled financial companies such as Lehman and AIG (through American General Finance), such exposure is modest within the well-diversified portfolio and has helped to minimize the negative effect;
  • MassMutual provides the book value obligations to participants associated with making up any differences of underlying market value to a participant's book value;
  • Market losses on the underlying bond portfolio impact the crediting rate on an amortized basis, thus the crediting rate is only partly impacted as these losses occur and will trend over time in line with the stable characteristics of the product's return feature;
  • If a SAGIC is fully or partially terminated, the market value of the separate account securities is paid, which may result in a gain or loss of value in the SAGIC.

4. Are the assets in our defined contribution 401(k) retirement plan insured by the FDIC (Federal Deposit Insurance Corporation)?

No. The FDIC does not insure the money you invest in stocks, bonds, mutual funds (or separate investment accounts and collective trusts that may invest in stocks, bonds and/or mutual funds) life insurance policies, annuities, or municipal securities, even when you buy these products from an insured bank.

5. Are there any other mechanisms in place that protect our 401(k) retirement plan assets invested in separate investment accounts ("SIAs") or mutual funds?

Yes. Customer/shareholder assets invested in an insurance company separate investment account ("SIA") receive special treatment under state insurance laws, which provide that they will be insulated from the general creditors of MassMutual in the event of its insolvency. With respect to assets invested in a mutual fund, they are not considered assets of the mutual fund's investment advisor and are not subject to the claims of the advisor's creditors. In other words, even in the extremely unlikely event that MassMutual became insolvent, plan assets invested in MassMutual's SIAs or in the MassMutual Select Funds or MassMutual Premier Funds could not be reached by MassMutual's creditors. MassMutual also maintains fidelity bonding and other insured and self-insured programs that would cover a customer for losses as a result of fraud or theft.

6. Where can I obtain more information?

For more information, please log onto The Journey, call FLASHSM at 1-800-743-5274 (8 am to 8 pm EST) to speak with a MassMutual customer service professional or feel free to submit your questions via our website at www.massmutual.com.

Securities offered through registered representatives of MML Investors Services, Inc., member FINRA and SIPC (www.finra.org and www.sipc.org), 1295 State Street, Springfield, MA 01111. © 2008 Massachusetts Mutual Life Insurance Company, Springfield, MA. All rights reserved.

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Monday, September 29, 2008

Is Walt a tenor or a bass?

News from the New York City Opera:

In these times of toil and trouble, this is what America needs ...

New York City Opera Commissions Philip Glass to Compose an Opera Based on the Life of Walt Disney

Following a meeting of New York City Opera’s Board of Directors, Gerard Mortier, General Manager Designate today announced that City Opera is commissioning Philip Glass to compose a new opera, The Perfect American which imaginatively explores the life and career of Walt Disney. Based on the recent novel Der K├Ânig von Amerika (translated into English as The Perfect American by Peter Stephan Jungk, the opera, presented in collaboration with Improbable, is scheduled to open City Opera’s 2012-2013 season.

[...] Peter Stephan Jungk’s novel The Perfect American imagines the final months of Walt Disney's life as recounted by the fictional Austrian cartoonist Wilhelm Dantine, who worked for Disney in the 1940s and 50s. Through the prism of Dantine’s European sensibility, and his feelings of admiration and resentment toward his boss, the novel presents a multilayered image of the mid-20th-century American dream.

“The story of the last days of Walt Disney, American Icon and creator of perhaps the most pervasive fantasy world on our planet, is surprisingly gripping and at times disturbing. But, on the face of it, how could it be anything else? The pulse of his life has to be the pulse of our own American culture. And, like other aspects of life here, it is unimaginable, alarming, and truly frightening. I am looking forward to beginning these collaborations with Gerard Mortier at the New York City Opera,” stated Philip Glass.

I remember precisely the time and location when I heard that Uncle Walt had died.

It was a sunny December afternoon in 1966. I was outside my girlfriend's house in my Volkswagen beetle, nuzzling my girlfriend's neck. And then there was a news flash on the silly little radio on the VeeDub's metal dash that Walt Disney was dead, and the nuzzling stopped.

And I remember thinking: "This is awful ... wonder if my dad knows?"

He did. And he was somber when he got home from the studio that night.

-- Steve Hulett

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Annie Awards call for entries (and judges)

ASIFA-Hollywood announces its 'Call for Entries' for consideration for the 36th Annual Annie Awards, to be held January 30, 2009, at Royce Hall on the campus of UCLA. The deadline for entries is October 10, 2008.

Honoring excellence in the field of animation, Annie Awards will be presented in the categories of animated theatrical feature, television production, television commercial, short subject and video games, as well as to individuals who have worked on these productions.

Entries submitted for consideration will be from productions that originally aired, were exhibited in an animation festival or commercially released between January 1, 2008 and December 31, 2008.

To access the online official entry form, click here. Current 'Categories & Rules' can be found by clicking here. All entry forms can be found on the Forms page.


The International Animated Film Society, ASIFA-Hollywood is seeking individuals interested in serving on nomination committees for the 36th Annual Annie Awards. Nominating committees shall select the Annie Award production nominations and individual achievement nominees.

Applications must be received no later than Friday, October 17, 2008. Individuals who are selected to serve on a nomination committee, shall receive a pair of complementary VIP tickets to the 36th Annual Annie Awards, which will take place on Friday, January 30, 2009, at UCLA's Royce Hall, in Los Angeles, California.

Nomination judging shall take place on Saturday, November 15, 2008, at Woodbury University, in Burbank, California. Judges may also be required to do some additional judging within the following days, as well as participate in pre-selection activities, via email, prior to the judging session(s). To apply, please visit http://annieawards.org/Judging.htm.

The Annie Awards have long recognized pioneers at the forefront of animation through nominations, juried awards and certificates of merit. In 1972, legendary voice actor June Foray organized the very first Annie Awards. Today, supported by major animation studios and production companies, the Annie Awards have grown into a much-heralded industry event and are considered an important industry benchmark and a predictor of the Academy Award for Best Animated Feature.

ASIFA-Hollywood is the largest of an international network of chapters and supports a range of animation initiatives through its membership. Current projects include an animation archive, library and museum, classes and screenings, and animated film preservation efforts.


For further details and questions, contact Gretchen Dixon by e-mail or at (562) 209-9900.

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Sunday, September 28, 2008

CN's Great Cloney Hope

The big players in TeeVee Toonland have been looking for a hot new series to kick the television cartoon marketplace to a higher level. Fox has its primetime animated lineup. Disney has its live-action franchises. For Cartoon Network, this week George Lucas rockets to the rescue:

Turner Broadcasting’s Cartoon Network, now running third behind Nickelodeon and Disney Channel in the kids market, sees “Clone Wars” as a game-changer, Mr. O’Hara said.

“This is the most significant programming event on Cartoon Network in our history,” he said. “It’s a significant property with significant interest beyond just our core demographic. So that’s a great opportunity for us and a great opportunity for our marketing partners.” ...

The animated feature carved from the series has done less than spectacular business, but as a big-screen advertisement for the half-hours that Cartoon Network premieres this week, it probably served its purpose.

This is the most significant programming event on Cartoon Network in our history,” [John O’Hara, executive VP of ad sales and marketing for Cartoon Network and Adult Swim], said. “It’s a significant property with significant interest beyond just our core demographic. So that’s a great opportunity for us and a great opportunity for our marketing partners.”

I'd say. The Time-Warner family appears to be marketing this franchise hard. And why not? Cartoon Network has been lagging in third-place for awhile. It perceives Clone Wars as its best bet for eclipsing Disney and Nick.

Naturally, I hope it gives the network a large boost. More eyeballs mean more money. More money means more series get made, and more artists go to work.

Kind of a recurring theme around here.

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Pungent Fall B.O.

The new Dreamworks-Spielberg blockbuster Eagle Eye doesn't bust the block quite as energetically as Paramount might have hoped, but still collects some nice coin with $29.5 million in its first weekend ...

And Richard Gere and Diane Lane take Nights in Rodanthe to #2 (over the cold feet of critics) with $13,570,000 in the domestic till ...

While Fireproof collects $6.5 million from 839 screens (lucky number!), making it the second highest per-screen grosser for the weekend.

But forget all that. The one feature in the Top Ten that had the smallest weekend-to-weekend drop was ...

The sophomore offering from M-G-M entitled Igor.

That, my friends, is animated news we can believe in.

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Saturday, September 27, 2008

So Where Will DreamWorks Animation End Up?

Now with full-flavored Add Ons!

Variety tells us that as DreamWorks' live action arm ankles Paramount/Viacom, DreamWorks Animation stays put:.

DreamWorks Studios may be re-launching with a new infusion of cash, but DreamWorks Animation remains in a distribution deal with Par that runs through 2012.

Originally spun into a public company to help investor Paul Allen liquidate his early investments, DreamWorks Animation is now in the unexpected position of having absolutely no business relationship with DreamWorks Studios.

Technically, the live-action studio hasn't been connected to its toon sibling in over two years, but it's no coincidence that the latter signed a seven-year distribution deal with Paramount at the same time the former was acquired by it ...

DWA toons have performed well for the past two years, grossing an average of $441 million worldwide. Overseas B.O. has been particularly strong, with this summer's "Kung Fu Panda" and last year's "Shrek the Third" grossing $409 million and $476 million, respectively, from foreign markets. Home entertainment perf has also been solid is a slumping market -- "Shrek the Third" has sold more than 20 million units so far.

... DreamWorks Animation stock is up 27% since 2006 ... Meanwhile, Par is getting into the toon biz on its own. The studio just greenlit its first animated feature (save for cheap Nickelodeon spin-offs), "Rango," which will star Johnny Depp, be directed by Gore Verbinski, and be produced at Industrial Light and Magic.

Insiders say it may be no coincidence that the pic has been scheduled for March 2011 -- perhaps as a sign that Par can do animation on its own, if needed. Katzenberg is rumored to be peeved, since DreamWorks Animation has its own film set to come out that May -- possibly "Kung Fu Panda 2." ...

As the only big domestic, stand-alone cartoon house still standing, how much longer will DWA remain on its own? Will it go back to Universal for a new distribution deal? How about getting purchased by General Electric lock, stock and barrel?.

The problem for me is that in a universe of conglomerates, a solitary animation company with no distribution network is a really rugged business model. Two flops in a row and staffs are cut, then desks and hardware start getting sold to pay the bills.

It's been a fabulous high-wire act so far, but how much longer can it go on? (I guess forever ... as long as those hits just keep on a-coming.)

Add On #1 We morph into a full-throated Jeffrey K. post with Mr. Katzenberg's ringing defense of 3-D films in Variety:

... [D]igital 3-D has arrived and, I believe, will eventually become the standard because, quite simply, human beings see in 3-D. Again, this is pretty basic stuff. And it's also pretty breathtaking stuff. ... [D]igital 3-D is very real, enriching the filmgoing experience in truly phenomenal ways. It provides filmmakers with an entirely new visual vocabulary and it provides filmgoers the chance to finally cross the threshold of the screen and enter other worlds. This is why many of the industry's greatest directors are currently working on 3-D projects.

Initially, as with color, the economic bar for 3-D is high, so for the foreseeable future many films will continue to be produced in 2-D. But, eventually, I believe that all films will be shot in this remarkable medium ...

Add On #2: And Mr. K. here explains why DVD sales are currently sucking. It's those damn video games ...

On a conference call with analysts today, he blamed videogames in part for the soft performance of "Shrek the Third" on DVD compared to "Shrek 2":

"Competition at retail from other sources such as videogames has had an impact on the overall homevideo market and on the performance of individual titles including "Shrek the Third."

My take on video games? Teen-aged boy spend freaking hours at their consoles. That obviously cuts into the time they could spend doing other things ... like going to movies at the mall or watching Shrek or Cars or whatever other animated title is out there. (That's why the studios license and create Shrek and Cars video games, no?)

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Friday, September 26, 2008

Disney Carvinal!

Spent a toasty afternoon at Disney TVA, the Main Lot edition. Outside on Dopey Drive and inside the courtyard of the Frank Wells Building, the company was holding a whomping big "tech fair." Hot dogs. Ice cream. Soft drinks. Fun for the kiddies.

All the far-flung Disney divisions, sub-sets and subsidiaries had booths and displays, touting their individual corners of Kingdom Mouse ...

The long rectangular interior space of the Frank Wells Palace was filled with booths and tables. Disney Feature Animation had a wall of Disney employee caricatures, digital story boards, demos going on. Pixar was down at the other end with the Wall-E presentation. The crowds were thick enough that it took me awhile to shoulder my way through the hubbub to Disney TVA.

Upstairs, work goes on for Phinneas and Ferb, Inspector Oso, the last of The Replacements. I spent a lot of time talking to board artists. One veteran told me how he was out of work for fourteen months, wondered if he should find another line of work, finally got back in to P and F. A designer was wrestling with getting a pose of the cartoon leads right, kept getting frustrated with the results, broke off to check political blogs.

More than one artist told me they intended to rush home at 5:30 to watch the Presidential debates. (Not a lot of support at DTVA for the current Commander-in-Chief. Hard to believe, innit?)

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Thursday, September 25, 2008

Linkomania

More news from various points on the animation compass.

Everybody is climbing aboard the big semi truck loaded with tentpoles. Pixar has now set Cars 2 for a 2011 release.

John Lasseter just announced to a crowd of journalists assembled at the Kodak Theatre that “Cars 2” has been bumped up to summer 2011, a year ahead of what Disney/Pixar has previously announced in April. He said that animators are currently working around the clock, and that the plot will feature Mater getting his passport as he and Lightning McQueen travel around the world. Suspiciously absent from the description was the character voiced by Paul Newman, who is reportedly in poor health ...

Lasseter also unveiled additional info around the Disney Channel-slated “Cars Toons,” which will feature different tall tales being told by Mater. These cartoon shorts will be appearing on-air, on line and before Disney movies in the next few years.

Lasseter showed the crowd the first of “Mater’s Tall Tales,” which has the character explaining to Lightning that he was once a fire truck. Future installments will feature Mater as an Evil Kneivel-like dardevil, and a matador.

The indie animated feature Terra won the Grand Prize at the Montreal Animated Film festival. I mention it here because the flick was produced in Los Angeles, on Wilshire Boulevard. Frames Per Second offers its take:

... the full-length movie from artist/director Aristomenis Tsirbas is a minor triumph in that the quality of the Maya (character animation), LightWave 3D (modeling, texturing, lighting, rendering) and Modo (additional modeling, bridging) animation is such that it can compete at the box-office with larger studio films. Both design work and animation quality are uneven (humans have a distinct and well designed Pixar style to their faces and a completely flat and formless shape to their body and dress) ...

In these perilous times, evil doers are all around. But it's good to know that one of the devil's storm troopers is ... Mickey Mouse.

"Is Mickey Mouse an agent of Satan?". This is the question being asked today in an editorial in the Middle East Times, commenting on the fatwa issued by a Saudi religious leader, Sheikh Mohammed al-Munajid, according to whom "sharia, or Islamic law, calls for the extermination of all mice. That includes the common house mouse as well as the famous cartoon mouse". "The mouse", the sheikh explained in a television interview reported by MEMRI, the Middle East Media Research Institute, "is one of Satan's soldiers and is steered by him".

Well, it's widely known that Mickey did at one time practice the black arts, bringing all those brooms to life. So "agent of satan?" Works for me.

Imagi has nailed down distribution for its next animated feature:

Imagi Studios' upcoming CG-animated feature "Astroboy" will be released across North America on Oct 23, 2009, it was announced Tuesday.

Summit Entertainment, which picked up world sales rights to the film in June, has also committed to a 3,000 print wide release across the U.S. ...

The $40 million pic's road to release, however, has not been smooth. Hong Kong- and LA-based Imagi originally set up the film with Warner Bros and The Weinstein Co. handling global rights outside its own 'reserved' territories in Asia. However the two companies pulled out.

In Putinland (that's Russia to you and me) the fight for free and unfettered animation continues:

The television channel "2x2," which airs many popular Western cartoons, such as South Park and The Simpsons, may lose its license following accusations of "extremist" content of some of the series it has been broadcasting. Meanwhile, youths in Moscow and St.Petersburg are staging rallies in support of their favorite channel. In early September, a Moscow prosecutor's office sent an address to court, demanding that the content of South Park be ruled "extremist" and issued a warning to the channel, referring to experts' evaluation of 12 cartoon series aired by the channel as "promoting violence and pornography." The prosecutor's office ruled that South Park "disgraces Christians and Muslims and is offensive to all believers regardless of their religion, can provoke an ethnic conflict and extremist activities and instigate violence between adherents of different religions." A second warning of this kind would lead to revoking the channel's license, which is already set to formally expire in mid-October.

Meanwhile, the channel shrugs off the accusations. "We haven't violated any law," said Maria Telesheva, the channel's spokesperson. "We air adult content after 11pm, but there isn't anything really graphic - there couldn't possibly be anything graphic in an animation film."

Meanwhile, the channel encouraged its viewers to openly express its support, which some did. On Sunday, several hundred youths gathered to voice support for their favorite channel in downtown Moscow and St. Petersburg. On Monday, Moscow police detained one of the organizers of a youth rally in support of the channel near Novoslobodskaya metro station ... On the same day, police dispersed about two thousand youths who showed up for a concert in support of the channel at Moscow's club "Plan B,' ...

Forget about the economic meltdown! Fight for cartoons! Demonstrate for cartoons! Go to jail for cartoons!

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Wednesday, September 24, 2008

Disney Rolls Out the Big Guns

You can't say the House of Mouse isn't tub-thumping for its upcoming product:

The Walt Disney Co. wowed an industry crowd Wednesday in a showcase of its upcoming films that included a sequel to its 1982 sci-fi flick "Tron" and a "Lone Ranger" remake with Johnny Depp as Tonto.

The daylong presentation at the Kodak Theatre, home of the Oscars, delivered repeated surprises as actors emerged onstage to tout animated 3-D movies, live-action thrillers and comedies — with animal co-stars ranging from guinea pigs and chihuahuas to humpback whales ...

Commenting on Disney's lengthy rollout, which included a full screening of the animated dog-hero movie "Bolt," [actor Jim] Carrey told out-of-town guests, "You can go back home and say these saddle sores came from Hollywood ...."

I got a call today from one of the c.g. artists who was bounced at the end of Bolt's production. The guy had been there ten years, but you know how it is: "You're last performance review was a little weak Charlie, here's your final check, and thanks for being part of the team."

And after a decade and five movies, the artist takes one for the team -- out the door and off to a rendezvous with unemployment benefits.

But I was amazed how non-bitter the ex-employee was, really more sad and resigned than angry:

"Disney Animation doesn't have a lot of development going on. I don't know what they're going to be doing after Rapunzel. There's the King of the Elves thing, but after that? One of the rumors going around was Robert Iger wanted to close Disney Animation and just have Pixar do the animation..."

I allowed as how that wouldn't seem to be a smart business move. The nameplate still means something, even if the last animation regime's final few movies tarnished it. The artist said:

"My friends that are still there say the main lot is expecting big things out of the picture. It's good."

My desires are simple. I want Bolt to be a mega smash hit. It helps the industry, it helps employment. Prosperity is what I'm about.

So here's to Bolt, and to the proposition that the movie marketplace will support two high-profile animated features at the same time, because Madagascar the Second will be out there alongside the doggie.

The last thing we need is 'toon cannibalization.

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Tuesday, September 23, 2008

The Tuesday Diz

As happens every few months, I've embarked on a round of 401(k) enrollment meetings.

Today was my first. And I expected, given the interesting times through which the stock market is traveling, that I would get close to zero employees showing up in Disney Animation Studio's big conference room. (No doubt there would be room enough in a hall broom closet.) But I was wrong ...

Ten 401(k) candidates showed up. After saying they must all be there because of the tremendous returns of the stock market (a few sardonic laughs), I went through the usual "How to fill out the forms," ... "How much you can invest" routine. After which I launched into a harangue I give often, and which I present (in condensed form) here:

"I don't think anybody should take money from the old 401(k) Plan from their last company and roll it into the new Plan at the new company. I know it's convenient, but here's why it's unwise:

"401(k) Plans, all 401(k) Plans, are more expensive than low-cost mutual funds like Vanguard, Fidelity Spartan, and a handful of others. Funds inside a 401(k) Plan are more costly because they have a layer of administrative fees on top of them that every Plan incurs because it has to comply with Federal regulations.

"Often, these fees aren't high. And often they're layered on top of the least expensive share classes of this or that mutual fund, but they are always there. And they make 401(k) funds more costly than index funds ... and many actively managed funds, in the non-401(k) universe.

"My advice? When you're able, roll over 401(k) Plan money into an IRA Rollover account at a low-cost Mutual Fund family. Not only will you lower your management fees, but you'll have a much wider universe of investments from which to choose."

And so on and so forth.

The Bolt crew is about where DreamWorks' Madagascar, Back 2 Africa crew is: right at the tail end of the picture.

Unlike the folks on Madagascar Deux, however, most Bolt staffers -- as they finish up -- will be headed for other gigs at other companies. A shame, but the way it is. There's simply nothing new for people to swing onto.

Meanwhile, the story crew on Princess and the Frog saw the latest version of that feature today, and I stood in the entrance hall on my way out, mesmerized by the random clips from Bolt flashing on the screens there.

Looks like a solid flick to me. Hopefully both Disney and DreamWorks will clean up with their respective animated pictures this holiday season.

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DreamWorks On a Monday

I was back at DreamWorks Animation yesterday. (I go over there a lot, because the campus has a lot of Florentine buildings with a lot of artists and writers in them, and I'm not energetic enough to get to all of them in one fell swoop) ...

Monday I walked through the lighting department for "Madagascar II", the next picture DWA will release. The last few shots were going through the department, a lighter related:

"We're pretty much done. Now it just goes to repair and check ... and they'll change a bunch of our shots like they always do..."

This was said in a half-jocular manner.

I ended up Monday's tour in the office of a longtime veteran who's been in the business almost exactly the same length of time I have. He spent a couple of years working on Madagascar II, and is now on a new project (which I ain't gonna mention because I don't need any phone calls from DWA: Hello, Steve? We haven't announced that picture yet. So shut your pie hole, would you please?")

As always, I'm amazed at the depth of Dreamworks Animation's development slate compared to any other studio here in town. DWA doesn't lack for projects. They've got features line up on the runway from here to 20013 ...

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Monday, September 22, 2008

Interesting Times

Another short detour away from animation.

Economist Nouriel Roubini, who has been pretty much dead-on about all things economic over the past few years, held forth in yesterday's Financial Times:

The shadow banking system is unravelling

By Nouriel Roubini

Last week saw the demise of the shadow banking system that has been created over the past 20 years. Because of a greater regulation of banks, most financial intermediation in the past two decades has grown within this shadow system whose members are broker-dealers, hedge funds, private equity groups, structured investment vehicles and conduits, money market funds and non-bank mortgage lenders.

Like banks, most members of this system borrow very short-term and in liquid ways, are more highly leveraged than banks (the exception being money market funds) and lend and invest into more illiquid and long-term instruments. Like banks, they carry the risk that an otherwise solvent but liquid institution may be subject to a self­fulfilling and destructive run on its ­liquid liabilities.

But unlike banks, which are sheltered from the risk of a run – via deposit insurance and central banks’ lender-of-last-resort liquidity – most members of the shadow system did not have access to these firewalls that ­prevent runs.

A generalised run on these shadow banks started when the deleveraging after the asset bubble bust led to uncertainty about which institutions were solvent. The first stage was the collapse of the entire SIVs/conduits system once investors realised the toxicity of its investments and its very short-term funding seized up.

The next step was the run on the big US broker-dealers: first Bear Stearns lost its liquidity in days. The Federal Reserve then extended its lender-of-last-resort support to systemically important broker-dealers. But even this did not prevent a run on the other broker-dealers given concerns about solvency: it was the turn of Lehman Brothers to collapse. Merrill Lynch would have faced the same fate had it not been sold. The pressure moved to Morgan Stanley and Goldman Sachs: both would be well advised to merge – like Merrill – with a large bank that has a stable base of insured deposits.

The third stage was the collapse of other leveraged institutions that were both illiquid and most likely insolvent given their reckless lending: Fannie Mae and Freddie Mac, AIG and more than 300 mortgage lenders.

The fourth stage was panic in the money markets. Funds were competing aggressively for assets and, in order to provide higher returns to attract investors, some of them invested in illiquid instruments. Once these investments went bust, panic ensued among investors, leading to a massive run on such funds. This would have been disastrous; so, in another radical departure, the US extended deposit insurance to the funds.

The next stage will be a run on thousands of highly leveraged hedge funds. After a brief lock-up period, investors in such funds can redeem their investments on a quarterly basis; thus a bank-like run on hedge funds is highly possible. Hundreds of smaller, younger funds that have taken excessive risks with high leverage and are poorly managed may collapse. A massive shake-out of the bloated hedge fund industry is likely in the next two years.

Even private equity firms and their reckless, highly leveraged buy-outs will not be spared. The private equity bubble led to more than $1,000bn of LBOs that should never have occurred. The run on these LBOs is slowed by the existence of “convenant-lite” clauses, which do not include traditional default triggers, and “payment-in-kind toggles”, which allow borrowers to defer cash interest payments and accrue more debt, but these only delay the eventual refinancing crisis and will make uglier the bankruptcy that will follow. Even the largest LBOs, such as GMAC and Chrysler, are now at risk.

We are observing an accelerated run on the shadow banking system that is leading to its unravelling. If lender-of-last-resort support and deposit insurance are extended to more of its members, these institutions will have to be regulated like banks, to avoid moral hazard. Of course this severe financial crisis is also taking its toll on traditional banks: hundreds are insolvent and will have to close.

The real economic side of this financial crisis will be a severe US recession. Financial contagion, the strong euro, falling US imports, the bursting of European housing bubbles, high oil prices and a hawkish European Central Bank will lead to a recession in the eurozone, the UK and most advanced economies.

European financial institutions are at risk of sharp losses because of the toxic US securitised products sold to them; the massive increase in leverage following aggressive risk-taking and domestic securitisation; a severe liquidity crunch exacerbated by a dollar shortage and a credit crunch; the bursting of domestic housing bubbles; household and corporate defaults in the recession; losses hidden by regulatory forbearance; the exposure of Swedish, Austrian and Italian banks to the Baltic states, Iceland and southern Europe where housing and credit bubbles financed in foreign currency are leading to hard landings.

Thus the financial crisis of the century will also envelop European financial institutions.

The writer, chairman of Roubini Global Economics (www.rgemonitor.com), is professor of economics at the Stern School of Business, New York University .

Roubini predicts that the hedge funds -- all of them leveraged to the gills -- will be taken down next, and we'll be slogging through a dandy recession (We're traipsing through the shallow end already.)

There be rough seas, ahead, maties. Plan accordingly.

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The "Science" of Story Making

This is a type of article that makes me crazy:

With an unbroken string of hits stretching from 1995's "Toy Story" to this summer's "Wall-E," you'd think Pixar had story development down to a science.

Not even close ...

What is Variety talking about?

Story has never been a stroll in the park. Story has always been difficult, like trying to bottle lightning ... or thread fifty needles at a dead run. And sure, writer David Cohen is setting up a rhetorical straw man here, but that doesn't make the straw man any less silly.

There are six different plots; all else is embroidery.

It's the quality of the needlework that matters, and in animated films, the sewing and stitching mostly goes on until three weeks prior to release. But this isn't anything exclusive to Pixar, or anything new. It goes on at every studio, all the time, all the way back to Snow White, The Three Little Pigs and Steamboat Willie.

Even the films that turn out bad are tough to concoct.

If there was some kind of science to it, movies would be made in germ-free laboratories by guys with microscopes and Bunsen burners.

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Sunday, September 21, 2008

September Linkdom

Obviously DreamWorks Animation's Jeffrey Katzenberg has noted the Koch box office calculator here on TAG blog:

Katzenberg, speaking at the Goldman Sachs Communacopia XVII Conference in New York, told Wall Street analysts to adjust the "multiplier" estimates for the movie. A "good" movie, he said, will earn 3.5 times opening weekend box office, while a "very good" should get a 4 multiplier and an "exceptional" movie a 4.3 multiplier.

Either that, or Jeffrey can also do math ...

Robert Winquist, an iconic teacher at Cal Arts, died on September 10th:

He was the kind of inspirational teacher that movies are made about, said his former students, who went on to make films that reflected lessons learned in his Valencia classroom between 1983 and 1991.

Ralph Eggleston, who won an Academy Award in 2001 for his animated short "For the Birds," credits Winquist with pushing students to think more broadly about what they could accomplish.

"When Bob came in, animators primarily left the school and became animators. Suddenly, they started becoming art directors and storyboard artists. He made us think of ourselves as filmmakers, not just animators," [Pixar art director Ralph] Eggleston said ...

Foreign box office continues to percolate, and Pixar's latest feature thrives right along with it:

Family fave "Wall-E" scooped up $6.6 million at 2,700, mostly thanks to No. 1 launches in Australia ($3.1 million), Greece and New Zealand. The Disney-Pixar vehicle's become the 10th pic released this year to top $200 million.

So the little robot is up to, what? $420 million in worldwide grosses? I'm guessing it generates profits.

Producer Max Howard tells of getting the new animated feature Igor to the screen:

Howard contends that this film is a smaller, independent production. "We're not aspiring to be Pixar or Disney," Howard says. "We're more like Juno. I'm hoping we'll be discovered."

That discovery appears to be underway. In fact, when Igor opens on September 19 in North America, it will be on more screens than originally anticipated. "We'll be on 2,300 screens," Howard says. "We originally thought it would be 1,200 to 1,500 screens."

Steven Spielberg and Peter Jackson are hitting some rough headwinds as they try to get their Tin tin animated features financed:

Steven Spielberg and Peter Jackson don't hear "no" very often.

But after they submitted a final budget of $130 million for their 3-D animated movie "Tintin," based on the Belgian comic strip, to Universal Pictures, the studio balked. The decision has left the two powerful filmmakers scrambling to find another financial partner ...

The particular problem for Universal with "Tintin" is that Spielberg's and Jackson's involvement comes with a huge price tag. The two filmmakers together would command such a large percentage of the movie's revenue as part of their compensation -- without putting up any of the capital themselves, as is typical in Hollywood -- that it takes a substantial slice of the profit off the table for the backers ...

We end with a piece on the teen-aged world's favorite show, Robot Chicken:

The series, which uses stop-motion animation, began largely as a hobby for [Seth] Green and partner Matthew Senreich, who worked in the comic book world in New York. The Emmy Award-winning series has a large following, not only in the United States, where it is shown on the Cartoon Network Adult Swim block, but also abroad, where they get the parodies of pop culture and spoofs of the Star Wars movies.

Senreich said the series has an aggressive production schedule _ roughly about 11 months work to produce a 20-episode season. The company started with a few employees and many interns to a current staff of more than 100 people.

Green, who appeared as Doctor Evil's son Scott in the Austin Powers movies, has no plans to abandon his movie career. But he says his work in animation is giving him much satisfaction ...

Add on: Variety details the competition between Disney Xtreme Digital (formerly Toon Disney and Turner/Time Warners' Cartoon Network (whcih Variety mistakes for a Viacom subsidiary):

The Mouse's ad-supported toon net will face a tough hombre in the mighty Cartoon. The Viacom net recently announced new iterations of marquee properties -- including a new Star Wars show -- for the fall, and it's about to debut a giant, downloadable massively multiplayer online game called FusionFall; after all, the kids these nets need are notorious for reaching for a joystick before their remote control.

If Disney has a cheering section in this enterprise, it's Madison Avenue, which, if it's going to sell action figures or sugary food, has to buy boy-focused ad time from Nick or Cartoon, whether their ratings are good or not.

Enjoy the dwindling hours of your weekend.

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Another Visual Effects House Shimmies Up the Greased Pole

The Sunday Times has a piece on a British effects house morphing into a cartoon studio:

MOVIE special-effects house Framestore is hunting for financial backers to turn it into a British version of Pixar, the Disney-owned animations studio behind Wall-E and Toy Story.

“We are looking at moving up the food chain,” said Sir William Sargent, who founded the business with colleagues in 1986. “There is an awful lot of exciting stuff going on in 3D films.”

Framestore won an Oscar for its work on the computer-generated armoured bear in The Golden Compass and also created Aslan the lion for this year’s Prince Caspian film.

Its first feature-length animation, The Tale of Despereaux, starring a mouse voiced by actor Matthew Broderick, will be released by Universal at Christmas.

In four years, the company, which has the largest computer-generated-effects studio in Europe, has grown from 300 staff to 750, split between London and New York ...

Here's the sad reality about viz effx houses. The profit margins suck.

And they've been sucky for years. A decade ago, a cg supe at Disney and I had a long conversation about how every major studio had gotten into ... and then out of ... the visual effects business, since it was a splendid way to make no or little money.

"Every effects house bids against every other effects house for the live-action jobs, and the one that low balls the bid gets the work, and then makes nothing doing the work.

The guys working out of their garage, with no overhead, win."

Okay, he was using a tiny dollop of hyperbole, but not much. But you'll notice that Warners is no longer in the effects business, nor is The Secret Lab, and Sony has Imageworks up on the auction block every now and again.

Because of the narrow margins, many visual effects studios sooner or later glom onto the bright idea of becoming full-bore c.g.i. animation studios. ("Make your own animated feature! Make a mint!") More often than not, it's red ink that comes sloshing in, and not Big Bucks. Just ask Vanguard. Just ask IDT Entertainment.

But good luck to Framestore. Maybe they'll succeed where others have failed.

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Saturday, September 20, 2008

The Big B.O.

... Has slipped overall from a year ago. But hey. We're in a financial crisis, after all. People are home weeping over their melting 401(k)s, not att the movies!

Igor opens in mid-pack, with a $2 million Friday gross ...

The Top Ten:

1. Lakeview Terrace (Sony) $5.1M Fri [2,464 theaters] NEW, Wkd estimate $15M

2. Burn After Reading (Focus) $3.4M Fri [2,657] -47%, Wkd est $11M

3. My Best Friend's Girl (Lionsgate) $3.0M Fri [2,604] NEW, Wkd est $8.5M

4. Righteous Kill (Overture) $2.3M Fri [3,152] -61%, Wkd est $7M

5. Igor (Exodus/MGM) $2M Fri [2,339] NEW, Wkd est $7M

6. The Family That Preys (Lionsgate) $2M Fri [2,070] -66%, Wkd est $6M.

7. The Women (Picturehouse/Warner) $1.8M Fri [2,995] -49%, Wkd est $5.5M

8. Ghost Town (DreamWorks/Paramount) $1.5M Fri [1,505] NEW, Wkd est $4.5M

9. The Dark Knight (Warner) $750K Fri [1,905] -32%, Wkd est $2.8M

10. The House Bunny (Sony) $750K Fri [2,675] -41%, Wkd est $2.5M

Congratulations to Max Howard and the gang for the launch of Igor. Not a huge weekend, and DreamWorks live-action entry Ghost Town seems to have landed with a sickening thud despite good reviews, but we'll see what develops ...

Add On: The weekend results are in, and Igor ends with a fourth place finish about $1 million over earlier estimates -- 8 million bucks.

Elsewhere on your box office hit parade, Lakeview Terrace (not the small burg next to the 210 Freeway, but the movieland version), collects $15.6 million to come in #1 ... and Samuel Jackson strikes again.

Burn After Reading drops 41% to second place in its sophomore outing, now stands at $36.4 million ...

My Best Friend's Girl, despite the most wretched reviews of the frame, takes the third position, along with $8.3 million.

And Ghost Town, despite positive reviews lands at #8 with $5.1 million. Go figure. (I guess Kate Hudson delivered her fan base.)

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Treasury Announces Guaranty Program for Money Market Funds

If you've been totally focused on your Cintiq over the past week, you might not have noticed that the World and American economies have been going through ... ah ... serious gyrations.

So to let you know, the world and U.S. econmies have been having hiccups.

We've gotten nervous inquiries about whether Mass Mutual, our 401(k) administrator, is safe, if the various funds in the Plan are safe, and so on.

Here's some of the skinny: Mass Mutual can go into bankruptcy tomorrow and it won't affect the cash held in our various funds, since by law those are all held separate and apart.

Obviously, if different funds decline in value because of equities or bonds held in those funds, you will lose money. That's the way the market -- usually -- works *.

But the good news is: if the administrator goes under, it won't adversely impact anybody's fund holdings.

What follows is an announcement from the Treasury Department about the type of fund accounts it intends to backstop ... inside or outside 401(k) Plans. Those funds are called "Money Market Funds" and TAG's 401(k) Plan does not currently have any "money market" accounts in its line-up of funds. The closest thing that we have is Mass Mutual's "SAGIC Account," and we are in the process of finding out how the U.S. Treasury's new "Guaranty Program" (detailed below the fold) will impact it.

In the meantime, read Treasury's press release, and gain reassurance that we are on the right track under the sure and steady hand or our Leaders in D.C.

http://www.ustreas.gov/press/releases/hp1147.htm

September 19, 2008

Treasury Announces Guaranty Program for Money Market Funds

Washington- The U.S. Treasury Department today announced the establishment of a temporary guaranty program for the U.S. money market mutual fund industry. For the next year, the U.S. Treasury will insure the holdings of any publicly offered eligible money market mutual fund – both retail and institutional – that pays a fee to participate in the program.

President George W. Bush approved the use of existing authorities by Secretary Henry M. Paulson, Jr. to make available as necessary the assets of the Exchange Stabilization Fund for up to $50 billion to guarantee the payment in the circumstances described below.

Money market funds play an important role as a savings and investment vehicle for many Americans; they are also a fundamental source of financing for our capital markets and financial institutions. Maintaining confidence in the money market fund industry is critical to protecting the integrity and stability of the global financial system.

Concerns about the net asset value of money market funds falling below $1 have exacerbated global financial market turmoil and caused severe liquidity strains in world markets. In turn, these pressures have caused a spike in some short term interest and funding rates, and significantly heightened volatility in exchange markets. Absent the provision of such financing, there is a substantial risk of further heightened global instability.

Maintenance of the standard $1 net asset value for money market mutual funds is important to investors. If the net asset value for a fund falls below $1, this undermines investor confidence. The program provides support to investors in funds that participate in the program and those funds will not "break the buck".

This action should enhance market confidence and alleviate investors' concerns about the ability for money market mutual funds to absorb a loss. Investors in money market mutual funds with a net asset value that falls below $1 would be notified that their fund triggered the insurance program.

The Exchange Stabilization Fund was established by the Gold Reserve Act of 1934. This Act authorizes the Secretary of the Treasury, with the approval of the President, "to deal in gold, foreign exchange, and other instruments of credit and securities" consistent with the obligations of the U.S. government in the International Monetary Fund to promote international financial stability. More information on the Exchange Stabilization Fund can be found here.

* I, of course, exempt those stocks, bonds and companies that the fine socialist government in Washington D.C. has nationalized. That's a different deal.

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Friday, September 19, 2008

The TAG Building's Progress

The steel girders that are transforming 1105 S. Hollywood Way from dowdy and non-descript to something special have been set in place.

This is a view of the southwest side entrance, with the new steel frame up above the door. (A couple of months from now, when the structure is completed, this will all make great stylistic sense. Now ... well, it's a hollow steel box on top of a wall.) ...

Yet another view of the side ....

And the front of the building, with another big steel frame. (More steel work is yet to come; the front wall is going to be moved out a few feet from where it is now.)

You'll note the tall cranes that are putting all these new pieces into place. Things are coming right along.

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End of Week Studios

Thank God It's Friday.

My end of week romps took me to Disney TVA at the Frank Wells Building, Rough Draft, and good old Film Roman.

At Rough Draft in Glendale, I eased past workmen installing a new front door and visited the Sit Down, Shut Up artistic staff. The show is humming along now, and most everyone Sony/Rough Draft intends to hire has been hired. The animated sitcom goes on the air next April, so my stoolies tell me. (The actual date I heard was April 19. Hopefully it's accurate).

At Disney Television Animation / Frank Wells, there are a handful of shows happening. The Replacements is in post, with most (all?) of the artistic staff gone; Inspector Oso remains in production, and Phineas and Ferb is bopping along with its new season.

As I walked down the hall, I heard artists making gallows jokes about My Friends, Tigger and Pooh. Bad news, apparently, gets around. And gets reactions. (When you're an animation employee, that reaction is often black humor.)

And over near the fabled Bob Hope Airport, the Goode Family and King of the Hill half-hours are almost fully staffed at Film Roman/Starz Media. A newer employee on GF said:

"This is my second time at Film Roman, and I like working here. I particulalry like this show. People are mellow, people are nice, and I'm not working 80 hours a week and getting paid for 40 like I was on my last gig."

Which brings up the eternal, ever-present "unpaid overtime" phenomena. The subject was brought up multiple times this week by board artists and directors. As one of them said:

"It's a market thing. You know damn well what the situation is when you're taking work home or working at the studio 'til ten. There's lots of unemployed artists out there, and if you don't knuckle under and do the extra work for free, they'll go find somebody who will.

"Back in the nineties, the shoe was on the other foot. The studios were hard up for qualified talent, and a lot of us took advantage of that. But now, it ain't going to happen" ...

Fatalistic, wouldn't you say?

I had another long discussion with a board artist about this earlier in the week. He totally got that union reps can't follow people home to find out if they're working off the clock or not. If people ignore the collective bargaining agreement and/or labor law and work extra hours without additional compensation, then nobody can stop them (though at various times, I give it the good old college try.)

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Thursday, September 18, 2008

The Boutique Studio

There are few small, independent* cartoon studios around Los Angeles these days, and of the big independents, there is exactly one: DreamWorks Animation, specializing in theatrical blockbusters.

Today, if you're an "independent," you are most likely a for-hire studio that provides services for one of our fine, entertainment conglomerates. Think of Starz Media/Film Roman, think of Rough Draft.

Yesterday I visited a little studio that falls into a slightly different niche ...

Sabella-Dern Entertainment has been around for a half-dozen years. S-D was launched after Paul Sabella and Jonathan Dern departed MGM Animation after a lengthy run and set up their own shop.

SDE is headquartered in the West Valley, where Warner Bros. used to shoot its Westerns and cavalry pictures, back in those halcyon days when the San Fernando Valley was a collection of orchards and truck farms ... before the heavy asphalt-covered hand of urbanization reached out from Los Angeles.

Today, Sabella-Dern has a fair amount of production. The company is doing three Care Bears direct-to-video features, a My Little Poiny direct-to-video, and sixty-six episodes of the PBS series Angelina Ballerina. They also have another project they hope will soon be in production.

A lot of S-D's creative work is done off-site, but the studio is planning a move to a larger location where more artistic staff can work in-house.

* I here define "independent" as a stand-alone cartoon company that creates and owns its product.

Before the Feds allowed the entertainment business to become vertically integrated, there were several of these, with Hanna-Barbera being the most prominent and successful example in the teevee age. Now, of course, they don't exist.

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Nick's Newer 'Toons

The Chumster by Eric Robles ... courtesy of Frederator Cartoons

In a world where television cartoons die like mosquitoes during a cold snap, it's good to see Nickelodeon ginning up two new specimens:

Nickelodeon has picked up two animated series: a spinoff of Nicktoons Network's "Random! Cartoons" that features a high-profile voice cast and an interactive series created by the team behind Nick's "Blue's Clues."

The network has ordered 26 episodes of the CG-animated series "Fanboy and Chum Chum," a spinoff of the "Random!" collection of anthology shorts, and has greenlighted 20 episodes of the math-themed "Team Umizoomi," which combines 2-D and 3-D animation with live action ...

This is new management's first foray into fresh series, and the folks seem to be going in three directions: cgi animation, traditional animation and live action. "Covering all the bases" would be an apt description.

What is most interesting to me is that Fanboy and Chum Chum comes out of the "Random Cartoon" program of Fred seibert's troops. If you're not familiar with "RC", it's sort of an open casting-call for new projects, where artists come in and pitch storyboards of their eight-minute stories.

Nick accepts pitches for new cartoon shorts from all points on the compass. The pitches the company likes, it develops into full-blown animated shorts. And out of the most successful shorts, it greenlights multi-episode series.

This kind of "open source" development (wikitoons?) was developed by Fred S. when he was Prez of Hanna-Barbera. From that first batch of shorts came series like Dexter's Lab, Power-Puff Girls and Johnny Bravo, the nuclei of shows for what ultimately became Ted Turner's Cartoon Network.

A number of animation companies have used the wikipedia model since, but I'm always amazed it's not used more extensively than it is.

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Wednesday, September 17, 2008

Whaa? A KFP Sequel?

It appears that Mr. Katzenberg is moving toward an announcement about a Kung Fu Panda sequel:

Katzenberg told analysts at the Goldman Sachs Communacopia Conference in New York Wednesday morning, "I'm optimistic that all the things we need to make a great franchise and a great sequel will come together in the next few weeks or so."

Hmm. Another KFP movie. Could it be because KFP #1 did really, really well? That DreamWorks is a business that likes to make money?

Naah. They just have really good ideas for another one.

(Contrast DreamWorks craven, money-making ways to the pristine artistry of Pixar. Up there in Emeryville, no money-grubbing sequels* for them. It's all about the art and the vision.)

* Well, except for Toy Story #1, Toy Story #2, and the soon-to-be Toy Story #3, it's all about the art ... Oh. And the Bug's Life featurette at the parks. Except for those, it's all about the art.

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The Secret Studio

Well, actually it's not a secret, not really. It's an animation unit now working on the Warners lot, in two different buildings among the big sound stages where Casablanca, Oceans Eleven and Key Largo were filmed.

Director Chris Bailey heads up a crew of animators, riggers, board artists, surfacers and all the rest who are doing a number of shorts for the state department. When I strolled through yesterday, one artist said to me:

"We've got a terrific group here. People from Dreamworks, Disney, other studios. We're moving fast, so we're testing the rigs as we go along ..."

The shorts are being made for the great acronym "PEPFAR." And what is PEPFAR? "The President's Emergency Plan for Aids Relief."

The whole deal is supposed to last for three or four months.

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Tuesday, September 16, 2008

How Good is Bolt?

I've heard fine things from Disney staff regarding Bolt.

"The story is better than the last few, I'm happy about it" ... "The animation looks good, and I like the look" ... "The animation is solid" ...

Often the staff is right, and occasionally wrong. I always listen to what the creators are saying, but sometimes they're wrong ... which is totally understandable. When you're down working among the trees, it can be hard to see what the whole forest looks like.

Now Todd Gilchrist of ign.com has seen a sizable chunk of the flick, and apparently likes what he sees:

Bolt looks like it will be a fun adventure and a lively tale of friendship. The "episode" footage will likely register most strongly with readers of IGN thanks to the admitted influence of filmmakers like Michael Bay on its direction: the action itself is terrific, featuring Bolt and Penny as they deftly escape their pursuers, while Williams and Howard amped up the colors and cinematic tricks (slow-motion, "multiple" cameras) to create a show that, quite frankly, we'd actually like to watch. The quieter scene, on the other hand, is no less interesting, just less full of action, and animator Mark Walton's voice work on Rhino give the scene its alternate notes of humor and sincere emotion ...

... what was most interesting about Disney's approach to Bolt was the "painterly" aspect of the visuals and the way in which they have with the film tried to return the animated form to something that looks more hand-drawn than mathematically produced. American artist Edward Hopper was referenced multiple times as the inspiration for the film's cross-country backdrop, and a handful of isolates shots that were shown indicated that even within the computer, the artists working on the film could create images that actually showed brush strokes and imperfect edges – namely, all of the little details that made classic Disney films so distinctive and relatable.

Is Bolt any good? Will it connect with audiences? This is is the Pixar team's first time* at the plate with a Disney Animation release, so it'll be interesting to see.

* Hey, what about Meet the Robinsons? Welll .... it had well over half the work done when Ed Catmull and John Lasseter winged down from Pixar, therefore we won't count it.

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Monday, September 15, 2008

At the House of Mouse

By the happiest of coincidences (well, not really) I was in the Disney Hat Building today, and got these observations from long-time Diz staffers regarding The Princess and the Frog. Since it fits in with the thread below, I relate it here:

"I think that they're going to hire a lot more artists to get the picture out. I mean, they've hired more people for layout as they've gone along; I think the same thing will happen with other production departments as the picture gets closer to its release date. You ask me, they won't send as much of the work out as people think they will, because they won't be able to."

I floated a facsimile of the above quote past another Disney veteran who is also working on the picture. He had a different opinion:

"Management wants to get this feature out with a lower budget than the hand-drawn pictures were costing ten years ago. They don't know if they're going to get Aladdin and Lion King grosses, they just can't depend on those kinds of returns, and aren't expecting them. Me, I don't think that kids have the same desire to see hand-drawn features that they used to. They want the 3-D stuff. Just look at the grosses. They've been higher for c.g.i. animation.

"If the company can make money on a moderately budgeted hand-drawn film, it'll make more. If they can't, then they probably won't make more. I don't think they'll make hand-drawn features if they can't make them more inexpensively than they were produced for in the nineties, and have them make money ..."

My take: No company is a charitable organization. Corporations exist to make profits and get a return on equity for their shareholders. Disney, on the advice of John Lasseter, is trying its hand again at a hand-drawn feature. (And I can tell you that the company had no plans to make any more hand-drawn product before Mr. Lasseter's arrival.)

I hope that Princess and the Frog is the first of a long string of new hand-drawn features, since nothing would please me more. But how many pencil-created flicks are in Disney's future hinges, I think, on the success of The Princess and the Frog.

(Personally, I don't think audiences have a big preference for c.g.i. over hand-drawn. I think it's more a matter of the quality of individual films. But the recent history of various animated features' box office performances doesn't necessarily bear me out, so my thinking could be wrong ... and wishful.)

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Fox's Feature Business Model Vs. Disney's Feature Business Model (Hand-Drawn Edition)

A commenter below asks some pointed questions regarding Fox's style of feature making on The Simpsons Movie contrasted to Disney's style on Princess and the Frog. I provide my learned answers here (rather than way down in the other thread):

How does "cost plus" and "for hire" explain or excuse Disney's behavior? So the actual business entity is Fox. How does that change the point.

The point of the other comments was that Starz Media media was staffing the film as it saw fit, and Disney supposedly isn't.

I've seen no evidence of that. Disney is staffing Princess the way it is to hold down costs, but that's different than being "forced" to staff in a way different that it wants to.

Most companies don't need excuses to do what they do. They just plow ahead and do them.

Fox, as far as I know, accepted the cost of the film. They didn't say, "the film was too expensive-you hired too many artists."

You have some evidence of this? Because the Fox/Starz/Simpson Movie model is similiar to the Disney/Princess model. Both of them outsource production (for Fox on Simpsons Movie, it was animation, cleanup, digital coloring; For Disney, it's cleanup and digital coloring. The big difference? Disney is doing its animation in-house. Fox did a lot of its animation in Korea at Rough Draft, just as it does for the television show.)

Disney ... seems to be attacking the personnel traditionally employed to get the job done right as an unnecessary extravagance.

Not to be a company tool, but Disney is paying what the market (and the union contract) will bear. It's reported to me that some animators have refused Disney salary offers because they're low, and so aren't working on the project.

This is called "negotiating." You don't like the offer, you don't take it. And stay doing whatever you're doing elsewhere.

Robert Iger, I'm informed, wants the animation division heads to restrain salary costs. The division heads are doing that. It's not pretty from an employee perspective, but that's what appears to be going on. (Note: My day job is to represent employee/member interests; my task here is to be reality based and explain, to the best of my ability, what's going on.)

It seems that Disney the corporation is not allowing Disney the animation studio to staff as they see fit. This kind of intrusive demoralizing micro-managing was supposed to leave with Eisner.

I never saw the memo on that, so I really wouldn't know.

But it seems to me that Disney the corporation and Disney the Animation Studio are one and the same. And that Disney the Animation Studio is doing what it deems to be in the best interests of the division, without outside interference (and does Robert Iger giving Ed Catmull and John Lasseter his opinion constitute "outside interference?").

Now. You and I may disagree with the decisions Disney Animation execs are making, but I haven't seen any evidence that they're being arm-twisted by "Disney corporate."

All I can say is, I've walked through the "Princess and the Frog" unit numerous times and have picked up the following:

1) Some of the lead animators aren't happy to be "on call." (Note that Disney gave everyone the option to be on call or not, but most agreed to the new deal.)

2) Many assistants and journey animators are thrilled and happy to be back at the House of Mouse doing a hand-drawn feature.

3) Various people have griped to me that things "aren't the same" as they were in the 1990s, and some don't like the new ways of doing things ... which they think are worse than the old ways.

4) Everybody is aware of the fact that this is a project-length employment deal. The picture ends, they're gone. Nobody much likes it (who would?), but this is the way the business works now.

Bottom line: There are some differences between the Fox/Simpson model and the Disney/Princess model. The biggest differences? Fox was paying some people more, and Disney is doing all its animation in house, which "The Simpsons Movie" did not.

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Sunday, September 14, 2008

Fall Linkage

... which reaches its peak in ... oh ... mid-October, but we'll try this bunch on now.

At the Emmys, Peter Griffin is edged out by citizens of Colorado:

Fox's "Family Guy" went home empty-handed in the animation category, as Comedy Central's "South Park" collected the prize for hourlong animated series, and Fox's "The Simpsons" won in the absence of "Family Guy" in the half-hour animated category.

But Seth McFarlane has other aces up his sleeve, launches the Cavalcade of Cartoon Comedy:

Coming soon to your online ads: interstitial cartoons. And from none other than Seth McFarlane, the brain and 90% of the voices behind Family Guy. His new Cavalcade of Cartoon Comedy launched today with the first two shorts out of 50 planned.

Andrew Millstein and Jim Morris, executives with Disney Animation Studios and Pixar, have gotten promoted by the House of Mouse:

The newly created positions represent promotions for the two execs who have overseen the digital direction of Disney Animation and Pixar -- an important role considering the extent to which technology has affected how animated films have been produced over the years.

Millstein and Morris report to Ed Catmull, prexy of Walt Disney and Pixar Animation Studios ...

Then, of course, there is the question that has been on everyone's mind: So like, what happened to that Conan animated direct to video feature?

When it was announced as a direct-to-DVD animated feature, “Conan: Red Nails” sure had a lot going for it. Based on one of the most celebrated original stories by Conan creator Robert E. Howard and featuring design work from legendary fantasy artists Mark Schultz and Mike Kaluta, “Red Nails” staked claim on fanboy perfection when it announced that “Hellboy” actor Ron Perlman would be providing the voice for the headlining barbarian along with backup from stars like Mark Hamill and James Marsden.

Apparently, completion ... which was to combine traditional cell animation with CGI elements, [was harder] to wrap up than originally expected as the film slid past its initial summer 2006 plan of release. Soon after, the Swordplay Entertainment homepage was taken down, and although a site for “Red Nails” itself still stands, the last update was December of last year ....

I've wept tears of longing over this, but I'm hopeful of the flick being rolled out by its new release date.

Our Neighbor to the North dips its big toe into the bracing pool of stop motion:

With a running time of 79 minutes, Edison & Leo is Canada's first stop-motion animated feature-length film. It took director Burns, ten animators, and the rest of the cast and crew 10 months to shoot it, a huge undertaking he admits.

"It was the first one anyone had tried to do," the Canadian director tells CityNews.ca in an interview during the Toronto International Film Festival, where Edison & Leo was premiering.

"From an artistic point of view animation is such an un-dynamic process. You have to record the voices months before you shoot the action, and you're trying to avoid doing any re-shoots because it just takes so long. So it's a big challenge to take this un-dynamic process and end up with a film that feels like it flows and isn't stilted."

Undynamic? Well, he's entitled to his opinion. Maybe.

The Times of London notes an upcoming festival of Japanese artist Osamu Tezeka's wide body of work:

... Tezuka, who studied medicine and became a licensed physician before turning all his energy to art, had an extraordinary breadth of interest. His comics include an adaptation of Crime and Punishment and a Life of Buddha in eight large volumes ...

This week, a festival of Tezuka’s films, coupled with an exhibition of his artwork, will set the record straight. The week-long season at the Barbican in London cannot hope to be comprehensive – throughout his all-too-short life, Tezuka slept only four hours a night, the better to create more than 700 stories, 170,000 pages of manga, dozens of TV series and 17 feature films ...

Variety profiles HBO's first animated since Spawn:

Debuting on Sept. 28, [The Life and Times of Tim] plotlines are rife with one-in-a-million misunderstandings and snafus that leave its eponymous nice-guy protagonist menaced by a disgruntled prostitute and her pimp; pressured into fronting as his employer's new Hispanic VP (he's as white as Wonder Bread); and snookered into lodging a phony rape claim against a homeless "bum."

But the show's very history is a tale of profound unlikelihood. For one thing, "Tim" marks HBO's first foray into animation since "Spawn" shuffled off its quasi-mortal coil in 1999.

Second, how odd that after nearly a decade away from the cartoon biz, the premium cabler with a rep for being the gold standard of the smallscreen settled on a property that is so crudely drawn, deadpan, and static as to almost defy the term "animated."

And I have no idea where the show is being made.

Have a fine and glorious Sunday.

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Saturday, September 13, 2008

Flying With the B.O.

Now with Add On!

The highest tracking animated feature is ... Fly Me To The Moon. Wow and double Wow.

It's flying along at #17 with a payload of $8,748,000 ...

Meanwhile, Burn After Reading eked out a first-place Friday finish with $6.5 million. (Second place Tyler Perry's The Family That Preys had a higher per screen average, but a lot fewer screens.)

Tropic Thunder crossed the triple digit threshold with $100,016,000, and seventh place The Dark Knight is working its way to a $520 million domestic total.

Anything else you want to know?

Add On: The weekend final has the four rookies finishing 1st through 4th.

Burn After Reading makes $19.4 million.

The Family That Preys collects $18 million.

Righteous Kill garners $16.5 million.

And The Women rakes in $10 million despite not nice reviews.

Down in Cartoonland, 14th place Fly Me To The Moon now crawls up against a $10 million box office, as 9th position Clone Wars scores $420,000 for a 33.9 million total. And Wall-E (#22) climbs to the $220 million level.

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Good Animation, Bad Animation

One notch down, there is some testy back and forth about the animation in Enchanted. Is it good, is it bad? Is it lacklustre, is it inspired?

Here's why the argument is ultimately fruitless:

"De gustibus non est disputandum." In English that would come out: "In matters of taste, there is no argument." (More literally: "There is not to be discussion regarding tastes")

I liked Enchanted's animation fine. (You may disagree.)

Frank Thomas disliked Woolie Reitherman's broad animation of Captain Hook. (I was crazy about it.)

Ollie Johnston thought the best animation he did was in Robin Hood (I was in shock when he told me this.)

As related by Ken Anderson, Walt Disney was not enamored of the design and "look" of 101 Dalmations. (Many think it's spectacular ... and groundbreaking.).

Milt Kahl was disdainful of the animation in the early features, preferring the tighter, "subtler" animation of the fifties and sixties. (Others think the pioneering stuff is the cat's pajamas.)

Some commenters here believe that hand-drawn animation is the real deal, while cg animation is "digital puppetry." (I would argue with that on multiple levels, but in any event, audiences worldwide appear to be voting with their wallets in favor of the puppetry.)

"De gustibus non est disputandum."

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Friday, September 12, 2008

Working the Friday Dream

I've rambled around studios a lot this week, but blogged little about it. Everything was either A) boring, or B) stuff I didn't want to wag around the internets.

Nothing screamed at me, "Hey now. This would make a good blog post!"

But today is a little different ...

The animation crews on the east side of DreamWorks' campus will shortly be moving to the Lakeside Building, now that the upper floors have been revamped.

"The studio's been holding meetings about the move. We're gonna be in cubicles instead of offices. A lot of the cubes are nice and roomy, and an improvement for some people. But I donno. I'm going to miss having a room."

I ran across ace animator James Baxter, who is back at the studio animating on Aliens Vs. Monsters and designing characters for an upcoming feature. he said he's pretty much shuttered his company James Baxter Animation for the time being, and is back in the Land of Splashing Fountains as a full-time DreamWorks employee. And is happy with the decision.

"It was good having my own company, and I learned a lot. We did the Enchanted animation and hand-drawn work on Kung Fu Panda. I took the business address off the website, but I might go back and get other projects going in the future ..."

Shrek Goes Fourth has a small animation crew working away on experimental animation, the kind that always goes on during ramp up. A staffer said they're a month or two away from starting work on a sequence, with the normal production cycle following behind.

One veteran DreamWorker who recently returned to the studio after lengthy time away said:

"When I left, morale was not real high around here. But it seems to be a lot more 'up' in the time I've been back.

A string of hit films will do that.

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Thursday, September 11, 2008

"This is a Really Nice Studio To Work In ..."

... Which was what I was told by a (very pleasant) studio administrator when I dropped by to complain on behalf of a member about the studio's violation of the Collecitve Bargaining Agreement. He was working to convince me about how benevolent his cartoon factory is.

And you know, he's right. The place is a pretty nice place to work in. However, even nice places can do not-nice things ...

In my experience, even the better studios crap on employees just like the worser ones. They just do it less often. But there's a larger problem.

Every studio rides the big carousel from good to bad to mediocre in the treatment of employees, and then circles back again. Warner Bros. Animation went from "fabulous place to be work" to non-fabulous. Same with Disney. Ditto with a host of others. Time doesn't stand still and nothing remains constant.

I always grow suspicious when management claims about how neato-jet everything is. If it makes a point of telling me three times, I grow deeply suspicious. It's beside the point anyway, as I told the studio rep:

"If you lay somebody off but feel really, really bad about it, that's nice, but there's little difference between that and the studio that doesn't give two hoots as the pink slips are handed out.

"In both cases, somebody gets laid off. Who cares how the supervisor felt about it? Somebody lost his job ..."

Talk is cheap ... and ultimately worthless. The Reverend Ted Haggard can wax eloquent up there in the pulpit about the evils of sin and how it's important to live a wholesome, family life. But if Ted is sneaking off on weekends to get serviced by male prostitutes, how much are those sermons worth? And how seriously should we take them?

Don't put much stock in what studio administrations say. Pay close attention to what they actually do.

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Housing, Retirement and 401(k) Changes

Here's another of TAG blog's periodic side-trips into things economic, beginning with TAG's 401(k) Plan:

I've received expressions of confusion regarding the letter that was recently sent out to Plan participants. It involved a long explanation of combining numerous 401(k) accounts in TAG's Plan into one account. So here's the short, non-official version about what's happening.

* When we first engaged Mass Mutual as Plan Administrator, the company -- due to its internal tracking mechanisms -- broke out 401(k) contributions into separate accounts for each employer of our multi-employer plan. So if you worked for say, Disney, Warners, and Nickelodeon and made 401(k) contributions at each studio, you got multiple statements -- one statement for the House of Mouse, one for Warners, one for Nick, and so on. This caused angst, confusion and more than a teeny bit of irritation.

* So the multiple-statement thing will now be changing. As of the evening of October 10th, the annoying multiple statements will be combined into one all-encompassing statement. There will be a blackout period from October 6 to October 10 to get this merging of statements accomplished.

The above is a truncated version of upcoming facts. What follows below is opinion. Even better, the opinions of a person who is not a licensed financial advisor but deals with financial things day in and day out.

Re the stock market: I get complaints about the southerly direction of TAG 401(k) Plan's stock accounts. I tell people, "It's going to be choppy and probably downward over the next several months for equities. Company profit margins are shrinking. This puts pressure on the value and earnings, which results in lower stock prices. But if you have a long time horizon (ten to thirty years), this could be a good time to be slowly buying stocks, because you're buying at lower and lower prices. And getting better and better bargains."

Believe it or not, many don't buy this. They see their share accounts shrinking week by week, and freak. And bail out into fixed interest accounts. It's an emotional thing to do, also -- for many in their twenties, thirties and forties -- a short-sighted thing to do. It's hard under the best of circumstances to market time (knowing when to get in ... or out ... of stocks).

But hey. Everybody has to be able to sleep at night.

Re home prices: I got a call a few weeks ago from a member/401(k) participant who wanted to pull moolah out to fund the down-payment on a house. I said:

"Uh ... okay. But keep in mind that home prices haven't bottomed yet, and you might find yourself owning a place that's worth less* than you paid for it a year or two from now ..."

There's still a sizable inventory of housing out there, and lenders have suddenly gotten more picky about who they give loans to. (This is known as "closing the barn door after most of the herd has already escaped.") So residential real estate is declining. In my zip code, it's dropped 26%. In places like San Bernadino, Lancaster and Palmdale the toboggan slide has been way steeper and longer.

We've been through this before, back when aerospace contracted in the early nineties. That time, houses lost value for six-plus years. Out in Palmdale, you could drive past big housing developments from which the builders had walked away and gawk at half-built two-story McMansions bleaching in the desert sun.

This time, I think the drop will go on for almost as long. One of my best friends, a Wise Old Economist with a PhD in Economics from Cornell, believes that it will take four years to work off the nation's excess housing inventory. (This will vary from region to region. And predictions, even ones from PhDs, can be wrong.)

Long and short of it is, just now I think it's wise to:

Be conservatively invested, and have a bit more bonds than you'd normally have.

Not buy a house ... yet. The market hasn't bottomed.

Now, back to Cartoonland.

* Corrected from the stupidly incorrect "more."

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