La compañía de Walt Disney y Pixar inc

The walt disney company and pixar inc

In November 2005, Robert Iger, the newly appointed CEO of the Walt Disney Company, eagerly awaited the box office results of Chicken Little, the company’s second computer-generated (CG) feature film. He knew that, for Disney as a whole to be successful, he had to get the animation business right, particularly the new CG technology that was rapidly supplanting hand-drawn animation.

Yet the company had been reliant on a contract with animation studio Pixar, which had produced hits such as Toy Story and Finding Nemo, for most of its recent animated film revenue. And the co-production agreement, broken during the tenure if his predecessor, Michael Eisner, was set to expire in 2006 after the release of Cars, the fifth movie in the five-picture deal. Unfortunately, contract renewal negotiations between Steve Jobs, CEO of Pixar, and Eisner had broken down in 2004 amid reports of personal conflict. When he assumed his new role, Iger reopened yhe lines of communication between the companies. In fact, he had just struck a deal with Jobs to sell Disney-owned, ABC-produced television shows- such as “Desperate Housewives”- through Apple’s itunes Music Store. Iger knew that a deal with Pixar was possible; it was just a question of what tha deal would like. Did it make the most sense for Disney to simply buy Pixar?

Walt Disney Feature Animation

Walt Disney Feature Animation began with the production of Snow White and the Seven Dwarfs in 1934, Toys and memorabilia based on the movie’s characters were stocked in stores as Woolworth’s around the film’s release, a move that became trademark of Disney’s strategy. After many early successes, the animation division struggled for decades after Walt Disney’s death but was rejuvenated with the arrival of Michael Eisner, as well as Jeffrey Katznberg as chairman of Walt Disney Studios, in 1984. Under them, the studio produced a string of hit films that included The Little Mermaid and Beauty and the Beast up to enormous success of 1994’s The Lion King, which alone generate over a U$1 billion in net income for the company.

Disney’s Feature Animation unit was described as an open, collaborative environment. So open, in fact the leadership relied on all employees to generate story ideas. Three times a year, Michael Eisner, Roy Disney and two other Disney executives would host a “Gong Show” during which all employees had the opportunity to present their story ideas. The executives would cull the best ones and ultimately choose the winner. “It’s a very collective approach to our work. We spend a lot of time in meeting arguing, discussing, and trying to come a consensus” as one commented. Most of Disney’s animated story lines came out of these meetings. The winner was remunerated for his or her contribution and, while figures were not made publicly available, some said winners earned up t U$20,000. Disney animators were compensated, in part, based on the success of the film, which made it difficult for other studios lure talent away.

Eisner believed in making clear who was good at their, and who was not so good, and wanted to give control to leaders who had sense of judgment about creativity and business. Seventy-five percent of time, he was able to find a director who had these skills and wanted to work on a particular movie, the rest of the time directors would be told to just do it.

Katzenberg who was known for grueling work ethic and passion animation, made it his personal mission to bring the studio back to its former glory. He supervised every aspect of the studio’s films. According to one former Disney executive, “Jeffrey is a sheep dog and the wolf. He’s the sheep dog guarding us, and the wolf hunting us” Katzenberg was credited with hammering out the storytelling of each film and ensuring that each film had a moral resonance. He also brought on external talent to each movie, such Elton John, who contributed songs for The Lion King.

Recent Box Office Performance

After The Lion King in 1994, every Disney-produced animates film below expectations (see Exhibit 1) . when asked in 1997 about the division ‘s disappointing performance, Eisner replied “I don’t think people quite understand our company. We have many avenues to make money from one of our animated films. The video revenues from one of our films are large, the consumer products huge”

Some of the same features that observers credited for Disney Animation’s success- large staff, large budget, and lots of time- were also blamed for its demise. Disney Animation had jus 275 employees in 1998, about 950 in 1994 for the release of The Lion King, and 2200 at its peak in 1999. Competition for animators in the 1990’s also caused salaries, which accounted for 80% of each film’s cost, to balloon, with top animators’ pay rising from U$125,000 in 1994 to U$550,000 in 1999. And these pay increases affected employees across the board.

IN 1994, Eisner refused to promote Katzenberg to president of the company, prompting his swift departure. The absence of Katzenberg, who generally considered to be the studio’s creative force, struck many as the cause of the decline. As one commentator noted “the company’s one- invincible animation studio has fallen on hard times since studio chief Jeffrey Katzneberg left” In 1997, Katzenberg, along with Steven Spielberg and David Geffen, started rival animation studio DreamWorks. According to reports in the years followed. DreamWorks attempted to lure away some of Disney’s best animators.

Joe Roth, former chairman of 20th Century Fox, become chairman of Walt Disney after Katzenberg’s departure. In charge for six years, he focused the studio’s energy on live action film. Peter Schneider, former head of Disney Animation, took over 2000 after Roth left. Schneider’s goal was to deliver “emotional, thematic stories” He worked solely with established Disney directors and producers and relied on his younger development staff to broker deals with up-and-coming filmmakers, in contrast to the hands-on deal-making style of his predecessors, Katzenberg and Roth. The product development group assigned directors for each animated movie.

In late 1990s, Disney set up a “Secret Lab” in an old Lockheed plant near Burbank Airport as a response to the growing popularity of three-dimensional (3D) CG films. The group’s first CG project was costly Dinosaur, which released in 2000 to a strong opening weekend, but which ultimately disappointed at the box office. The lab was shuttered in 2001 after Roy Disney viewed and rejected the second project underway, Wildlife, which he thought was packed with adult themes and strayed to for from Disney’s family-friendly brand offering. Disney focused

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