Tuesday, July 24, 2012

DWA Diversifies

The company moves to expand beyond its core business:

Jeffrey Katzenberg, with deals that give him new characters, a theme park and a footprint in China, is signaling DreamWorks Animation SKG Inc. (DWA) (DWA) plans to expand beyond 3-D movies and home video. ...

“Five years from now, we will be a much more diversified company,” Katzenberg ... said yesterday in an interview on Bloomberg Television. “The animated movies will still be our heart and soul but I think we will see revenue from a lot of different areas.” ...

Mr. Katzenberg's business moves sort of mirror the expansion of Walt Disney Productions in the early fifties, when the House of Mouse expanded beyond animated shorts and animated features to get into live-action, television, and amusement parks.

Is that kind of expansion easier or harder to do, sixty years on?

It's an incredibly difficult hat trick during any era, but with the state of the world and existing economy in 2012, I really don't have a clue whether DWA will pull it off or not. When DreamWorks started back in the age of Bill Clinton, I would have told you that the live-action part of the business was going to thrive, and the animated features would struggle.

Shows what I know.


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