Wednesday, January 18, 2012

DWA's Future Cash Needs

The Nikkster's site is not sunny.

... [A]nalysts want to know how Katzenberg plans to distribute his films at the end of this year when his deal with Paramount expires. His silence about a potential replacement “leads us to believe that (he) may be seriously considering a self-distribution model, which would likely require some sort of capital raise, likely in the form of debt issuance” ...

The last ten years, I've watched DreamWorks Animation do a high wire act with a business model that requires it to turn out one hit film after another, and it's left me in awe.

As I've said before, the only other stand-alone company that performed the trick better was Pixar.

But now the marketplace is changing. More competition. More piracy. And the little silver disks aren't the hot sellers they used to be, for anybody. And DWA is out there all by its lonesome, the only company that isn't part of a big, fat entertainment conglomerate. (Jeffrey Katzenberg has maintained that he's happy being a solo corporation, but I've always believed that the goal was some sort of buyout. But hey, maybe I'm wrong.)

DWA's financial well-being is of concern to TAG because DWA is one of our largest contract studios, so DreamWorks future impacts our future. (Funny how that works.) I've thought for awhile that the features the studio produces have been on a steady, up-trending arc, creatively speaking, but will that be enough going forward?

Guess we'll find out.


TotalD said...

Anonymous said...

I know some people will be mad at me for saying this but I honestly think Disney is still a better studio than Dreamworks. True DW has some great visual development and character design artists but it sucks in terms of story and layout. Also they have done no animation anywhere near the level of Tangled. Disney's films are better and in a sense I think in a weird way the morale is better. Disney motivates people to do their best and to really transcend the medium while Dreamworks doesn't think that way. Also I find that the artists at Disney have better chemistry, are more persistent, and are more up to challenges. There are downsides to being treated like superstars: it oftentimes makes the other animators bow down to them and not do their best. Disney always encourages animators to do better than what they think is possible and I think this will continue to keep them as the center of the animation business for a long time. Don't forget Disney has something in their films DW just doesn't have: sincerity and heart. Love is powerful and that shows very much in the difference between the films of these two studios

Anonymous said...

I think both studios are pretty neat and provide a good many high quality jobs without harming dolphins. Overall, thumbs up.

Anonymous said...

"...better studio than Dreamworks..."

OF course, complete horse shyte. I'm not the biggest fan of some of the DW cartoons (and I don't work there) but I'd put the second Shrek, the first Madagascar, Chicken Run, KFP 1 & 2, and even a mild cartoon like HTTYD up against Fox and the Hound, Black Cauldron, Oliver and Company, Rescuers Down Under, Pete's Dragon, Small One, Chicken Little, Home on the Range, Atlantis, Wilbur Robinson, Treasure Planet, Princess and the Frog, and that awful new Winnie the Pooh thing ANY day.

Disney's made plenty of heartless and UGLY dreck with zero sincerity (see list above).

If DW made any mistake in their first 4 or 5 films (which all flopped), it was that while they knew they didn't want to be like "Disney," they DIDN'T know what they wanted to be.

Anonymous said...

I always have to shake my head when people say that Disney is better than Dreamworks or vice versa. We're all the same people flowing back and forth... and not even flowing that far.

Anonymous said...

"...better studio than Dreamworks..." gotta be kidding me. Funniest statement of the year. Disney is 'just now' trying to reform their structure(they said they were doing that on Bolt)..the studio is not even setup to produce animation the way it used to. They don't know what the value of their artists are and most are just expendable to the bigger corporate model of the Disney Co. The hire and fire method has been going on for a while at Disney. If you think hard the last hits before Tangled were when Jeffrey K was in charge of animation at Disney.

If you really believe DW doesnt nurture their artists, please explain how KFP and HTTYD got created. Artist driven projects with solid characters and story. Someone should stack the projects against each other and see which studios projects come on top. I am betting it will be DW's...and again...those hits in the 90's had JK backing them...

"....Disney always encourages animators to do better than what they think is possible and I think this will continue to keep them as the center of the animation business for a long time...."

HUH?? If that is the case why would they layoff good animators after every project. (and you can try to say "they werent good enough to stay" but that is bs because they are now trying to hire some of the same guys back.) The Disney animation team model is to PIT the animators against each other in order to keep your job because there may be a possible termination. (are you better than the guy that we hired last year who took so n' so's are...ok you got his job) and thats the truth!

Anonymous said...

Here comes China to collect debts due on the bush economic debacle.

Anonymous said...

^Here comes the dumb butt obsessing over Bush. Is this guy an animator? It's hard to think of such a nut having anything to do with something as intelligent as cartoons.

Anonymous said...

"....Disney always encourages animators to do better than what they think is possible and I think this will continue to keep them as the center of the animation business for a long time...."

Uh, that statement might be applicable to WALT Disney. But it certainly doesn't apply to Disney as it is run today. Unfortunately.

Anonymous said...

Our animal instincts are wired so that when we see a weakness it can make us act aggressively. This applies to both Dreamworks and Disney. When Disney Animation was in trouble Dreamworks pounced. Now Dreamworks is showing a crack and a Disney worker is in on the fast attack- as the 2nd comment displays.

Dear all, It would be loftier and wise to cheer for the other large studio that supports a union. We all need a solid industry- so leave the jugular jumping for the tigers.

Floyd Norman said...

I agree. We're all in this together.

Leave that, "I'm better than you are," to the dumb ass politicians.

Anonymous said...

I dont know who the 2nd commenter up there is, but I suspect they are new (to the industry, or a student, or maybe a new Disney hire)

I can say, being a Disney employee myself, that the majority of us dont feel that way. We're doing our thing, and we're happy to see Dreamworks doing theirs. As long as audiences keep going to animated films, there's room for all of us.

And that goes for Pixar and Blue Sky and Sony and Maguff as well.

el diablo said...

"honestly think Disney is still a better studio than Dreamworks"

'till you're no longer part of the 'disney family'.

You may think that, and no offense, that is very naive.

Seing that Dreamworks offers long term employment (at least, long term in todays terms) vs. Disney's project to projects basis, I would rather go to DW. Tangled's animation was not all that, no matter how much you think it is.


Anonymous said...

Tangled's animation was not all that, no matter how much you think it is.

Minority opinion.

Anonymous said...

Disney does not always make the best movies, but they seem to be doing a good job making their artists invested in their projects and cultivating new ideas.

Dreamworks on the other hand seems to be a movie making machine. They focus on a few key "superstars" and like commenter 2 said,make the rest of the artist "bow down" to them. If you are not a chosen one then you are treat just as a drone.

Anonymous said...

Merits of the various studios aside.... If anyone can make "self-distribution" work it's Katzenberg. He knows the pipeline as well as anyone and knows all the right people in the right places.

Retaining that 6% in real cash he's having to hand over to Paramount now is incentive enough to make it work.

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