Monday, July 21, 2014

Outsourced Away

I know the feeling.

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

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

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

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

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

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Crab Cakes on a Hostile Sea

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

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

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

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

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Speaking of Sequels

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

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

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

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

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

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

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

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Sunday, July 20, 2014

International Ticket Sales

Lots of animation (of various sorts) making money.

Foreign Weekend Box Office -- (Global Cumes)

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

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

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

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

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

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

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

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Free Fall

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

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

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

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

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

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Adios, Jim

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

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

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

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

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

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

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

I will miss him a lot.

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Azaria's New Gig

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

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

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

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Saturday, July 19, 2014

Unionization? Of Employees?

This is great:

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

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

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

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

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

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

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

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

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TAG 401(k) Factoids

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

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

Active Participants -- 2,359

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

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

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

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

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

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

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

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

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

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

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

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

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

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Domestic B. O.

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

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

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

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

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

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

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

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

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

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

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

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

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Friday, July 18, 2014

The More Things Change ...

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

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

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

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

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

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

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

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

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

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

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

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

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DreamWorks on a High Wire

From the dour Seeking Alpha.

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

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

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

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

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

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

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Thursday, July 17, 2014

Biggest Company in 2114

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

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

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

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

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

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

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

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TeeVee Pilots

The Diz TVA press release sayeth:

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

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

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

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

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

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Wednesday, July 16, 2014

Of Wages and Wage Surveys

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

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

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

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

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

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

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

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

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

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

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

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

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

Not much.

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

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

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

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Tuesday, July 15, 2014


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

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

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

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

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

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

Even worked that way when I was a kid.

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

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

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

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

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

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

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

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

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

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

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

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

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The Trailer

... for the movie following Frozen.

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

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

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Monday, July 14, 2014

Moving the Franchise

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

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

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

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

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

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

Double Meanings

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

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

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

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

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

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

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

Animated feature results across the globe.

Foreign Weekend Box Office -- (World Totals)

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

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

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

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

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

As one of the digital trade papers tells us:

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

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

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Board Approved

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

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

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

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

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

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

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Saturday, July 12, 2014


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

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

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

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

1105 N. Hollywood Way
Burbank, California 91505

Mark it on your calendar and BE THERE.

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

Interesting, no?

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American Box Office

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


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

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

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

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

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

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

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

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

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

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

As The Wrap tells us:

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

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

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Friday, July 11, 2014

Newer Development

From a couple of days back:

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

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

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

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

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

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

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TAG 401k Switch to Vanguard meetings

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

Dates & Locations:

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

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

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

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

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

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Peaceful Negotiations?

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

Why Hollywood Producers and Labor Guilds Chose Peace Instead of War

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

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

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

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

But ... whatever.

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

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

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

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

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

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

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

Click here to read entire post

Thursday, July 10, 2014

Pixar Chief

Not quite the kindly and avuncular studio head depicted in all those sunny books about the animation business.

... A top Pixar producer reveals in her email that [Ed] Catmull had in fact flown down to Sony Animation and met with the two co-heads, Penney Finkelman Cox and Sandy Rabins, to rope Sony into the non-recruitment cartel. That meeting presumably took place in 2004, when Catmull emailed Steve Jobs his intention to meet Sony about poaching employees. The email from Pixar’s producer reads:

“I do know he [Catmull] flew down and met with them [the two Sony executives] around a year ago and asked them to quit calling our employees.”

After reading that email to Catmull during last year’s deposition, the plaintiffs’ attorney needled him:

Q: That suggests or confirms that you actually – your memory is correct. You did go down there and talk with them [Sony].

CATMULL: Yes. ...

It's okay to negotiate Personal Service Contracts with employees and then defend those contracts against other employers that try to recruit those personnel.

But it's not okay to bully other companies into participating in wage and hiring conspiracies against workers who have the right to sell their skills and talents on a (supposedly) open market. (It's called "capitalism" in case you're wondering.)

Reading these Pando articles, it's pretty clear that few if any of the players thought the wage suppression thing was any big deal, but just a normal and rational way to do business. (And some of the folks mentioned in these e-mails and depositions are freaking lawyers.)

But the Sherman anti-trust act is such a quaint old law, anyway.

And the Brew's take:

With these documents, we now know that DreamWorks and Disney also undermined free market principles by colluding to restrict their employees’ wages and job opportunities. These revelations extend beyond the scope of the class-action suit, which is in the process of being settled with a paltry $9 million slap on the wrist for Pixar and Lucasfilm. ...

Not to worry; no big dents in cash flow will occur among our fine, entertainment conglomerates. Nobody in the corporate suites will be fined or go to jail. The wheels of commerce will spin serenely on.

Click here to read entire post


Animation isn't just expanding in the U.S. of A.

China's animation industry generated 87 billion yuan (14 billion U.S. dollars) in revenue last year, according to the ongoing 10th China International Cartoon and Game Expo in Shanghai.

The industry has expanded by 10 billion yuan in each of the past three years.

Animation product exports reached 1.02 billion yuan in 2013, up 22.8 percent year on year. About 220,000 people are working in 4,600 animation enterprises in China.

Last year, 29 domestic animation films were screened in China.

The total box office of China's domestic animated films hit 646 million yuan in 2013, up 48 percent. ...

The global animation business takes in a wide stretch of territory. There's video games, television product, theatrical features, interstitials, phone apps, broadcast graphics, and visual effects.

Then there's the profitability factor. Animation has higher margins than just about any other form of motion picture entertainment.

The global animation and gaming market is expected to grow from $122.20 billion in 2010 to $242.92 billion by 2016. The gaming market is the fastest growing, with a Y-O-Y of 17.46% by 2016. ...

The global animation and gaming market is growing at a Compounded Annual Growth Rate of 12.94% from 2011 to 2016. The major factors driving the animation and gaming market are expansion of target market, government initiatives, greater penetration, and accessibility of broadband internet, growth in the mobile subscriber base. ...

The question is, will more wage cartels spring up to hold down wages?

Click here to read entire post

Wednesday, July 09, 2014

Animation's Wage Cartels

... are now getting a wee bit of traction in the entertainment press. From Variety:

While a federal judge recently gave her approval to a settlement of a class-action antitrust suit over alleged “no-poaching” agreements involving Lucasfilm and Pixar, the Animation Guild is reviewing a recent report that highlighted similar hiring practices of other studios that were not named as defendants in the litigation.

Steve Kaplan, organizer for the Animation Guild, said members “are reviewing what remedies are available, if any” after PandoDaily published a series of emails and deposition transcripts suggesting that DreamWorks Animation and the Walt Disney Co. also were involved in so-called “gentlemen’s agreements” to not raid each other’s animation work forces. Such hiring practices came under the scrutiny of the Justice Department as well as a class action lawsuit, but both studios were not named as targets of an investigation or as defendants. ...

I've done this job for awhile now, and it's surprising the number of times executives have told me "We're in the employees' corner," and "We want to be fair." Or (my personal favorite) "We're all a FAMILY here."

Uh, no.

Corporations are many things, but they're definitely not Family. Because Dad, away from the company, doesn't violate law and knife his kids in the back. And Mom doesn't put her daughters up for adoption when the clan hits a rough patch.

The idea behind all the collusion was maintaining profit margins, meaning if laws need to be broken, "Okay then, we'll break the law." And in the meantime, we'll hire a massage therapist to come in and work on your tight muscles from the repetitive stresses acquired on the job. And then tell everybody how nice we're being.

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VFX On A Budget

It's not just for Lord of the Rings Part IX anymore.

Game of Thrones, Season 4 – VFX making of reel from Mackevision on Vimeo.

Added to which, if you get the work done in the right country or state, they'll give you lots of Free Money!

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Tuesday, July 08, 2014

More Raiding of the Pantry

101 Dalmations, then Maleficent, and now this. Where will it end?

Disney is developing a live-action take on its 1941 animated classic Dumbo and has Transformers franchise writer Ehren Kruger penning the script.

Justin Springer, who worked on Tron: Legacy as well as Oblivion, is producing, as will Kruger.

At 64 minutes, Dumbo is one of Disney’s shortest features but remains one of its most emotionally satisfying ones as it tells the story of a baby circus elephant who is made fun for his large ears. When his mother steps in to protect him and is locked up for it, he ends up on the road with a mouse as his companion. The mouse instills into Dumbo the idea that with the help of a magic feather, he can fly. ...

The new take involves the adaptation of the original movie while adding a unique family story that parallels Dumbo's story. Also, the studio believes that because of the current state of CG technology, live-action movies featuring a soaring pachyderm (or any animal for that matter) are viable ...

Recycling, it's the name of the game.

But this isn't the first time a newer version of Dumbo has been put into development. Some years ago, when David Stainton was briefly heading up Disney Toon Studios before his promotion to chief of Disney features, a sequel to the '41 classic was in extended development. Joe Grant, one of the original writers of the first film, was peripherally involved in the project, pushing to make the newer rendition a CG production. (Dumbo II has started life as a hand-drawn sequel.)

But after quite a bit of work had been done, the project was shelved, the crew laid off and/or moved on to other projects. That was the last I heard of a new Dumbo movie.

Until now.

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Richard Percy Jones, RIP

The lead voice actor from Disney's second animated feature exits.

Richard Percy Jones, best known for voicing the wooden puppet “Pinocchio” in Disney's 1940 animated film, has died at the age of 87.

According to the Los Angeles County coroner's office, Jones was found dead in his residence in Northridge, Calif. on Monday by a family member. ...

Time passes.

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In Our Glorious Corporatist State

... the Corporatists rule with a tight fist.

Just when the tech giants behind the Silicon Valley “Techtopus” wage fixing cartel thought the worst was behind them, US District Judge Lucy Koh has thrown a surprise twist — refusing for now to give her seal of approval to the $324 million class action settlement.

Judge Koh has suggested the agreed settlement might be too low, but there are whispers that Koh is frustrated at being denied the chance to preside over what would have been one of the most interesting and significant Big Tech court cases ever (a frustration shared by this particular journalist and at least one of the plaintiffs in the case, Michael Devine).

... [M]ost of the previous attention in the case was focused on the behavior of executives at Apple and Google. What hasn’t been fully explored is the involvement of major and minor Hollywood studios that are alleged to have been party to the same illegal cartel. The wage-fixing cartel originated with Pixar and Lucasfilm, two northern California computer animation film studios now under Disney’s roof. ...

[I]n February 2004, [Pixar exec Ed] Catmull emailed Steve Jobs — who served simultaneously as CEO of Pixar and Apple — to complain about Sony Pictures chiseling in on the computer animation business and not playing by the rules. Which, as Catmull wrote to Jobs, meant Sony was trying to poach Pixar’s tech specialists by offering them higher pay: “Sony has approached all of our producers trying to hire them. They all just ignored Sony,” Catmull wrote Jobs, explaining:

“We don’t have a no raid arrangement with Sony. We have set up one with ILM [Lucasfilm] and Dreamworks which has worked quite well.”

Catmull tells Jobs he plans to visit Sony’s animation people, to rope them into the wage-fixing cartel:

“I probably should go down and meet with [REDACTED] and Sony to reach some agreement. Our people are become [sic] really desirable and we need to nip this in the bud.” ...

What Dr. Catmull is talking about, is nipping rising wages in the bud. Because things might start to get out of hand. And we couldn't have that. (What's a little wage-control between chummy movie top-kicks, hmmm?)

The point of the above, boys and girls, was to keep Adam Smith's rules (you know, the "free enterpirse" thing?) from working.

Because labor is a commodity, just like oh ... movies ... or sow bellies. And when a group of wealthy executives get together to make sure that market forces don't perform as they might, well, people suffer. (Mostly people that have to pay rent and meet a mortgage.)

Never forget: In our glorious corporatist state, rules and laws are for the little people.

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