© 2003, DOW JONES & COMPANY, INC. ALL RIGHTS RESERVED www.barrons.com MONDAY, OCTOBER 13, 2003 Coy Story Will Steve Jobs jilt Disney? No matter what happens, Pixar stock seems overvalued TINY PIXAR IS THE HOTTEST TICKET in Hollywood. Fresh off the huge success of its latest animated movie, "Finding Nemo," an emboldened Pixar is bargaining hard over a new film-distribution agreement with its partner, Disney, while weighing offers from other studios. "Finding Nemo" is the highestgrossing movie in the U.S. this year, with projected domestic box-office revenue of more than $335 million. "Nemo" is expected to generate over $1 billion of revenue after international distribution and video sales, netting about $500 million in total …show more content…
The current five-movie distribution deal was signed in 1997, when Pixar needed Disney' s financial muscle. Neither Disney nor Pixar is commenting publicly on the high-profile talks. Savner, who began coverage of Pixar with a Sell rating last month, says investors "have overestimated" the benefits of a new distribution arrangement. He calls Pixar "capacity-constrained" for the foreseeable future. Pixar is stepping up production, planning to release one movie in each of the next three years, versus the 18month gap between its last two, "Nemo" and "Monsters Inc." But says Savner: "You can' t simply double production. There' s a finite amount of talent." Even if Pixar gets all the profits of its films starting with the 2006 movie, it still must produce hits. The buzz is good on "Incredibles," supposedly about a dysfunctional family of superheroes that come out of suburban semi-retirement to save the world. Pixar is as close to a sure thing as exists in the unpredictable movie business, but no one in Hollywood ever has had an endless winning streak. "It' s hard to put a string of 10 mega blockbusters together," says Savner. "The first time a movie doesn' t perform well. The stock will be down and could be dead money until the next movie a year later." The blockbuster results for "Nemo" have set the bar high. Even
IRTC spoke with CPS, Cari Covahey, who reported that she observed the subject child and her siblings and there were no visible injury. CPS stated that there are no present issue regarding the subject child being sexual abused, but she seems to have a strong attraction to sexual related content. CPS uttered that she was told that the child is making comments about wanting to get pregnant and she frequently make remarks which are sexual in nature. Based on the above statement, this case does not meet the criteria for an IRT. However, if there is any suspicion pertaining to the subject child begin sexually abused in a physical manner, CPS is to contact IRTC or an IRTC at ECS (after hours) for a case reassessment.
In summary, on 07/29/16 at 1907 hours T/O Arlowski #374, Ingve #377 and I were dispatched to 5636 W 35th St. in regards to a fight in the courtyard.
On Pixar' s August earnings conference call, Jobs said Pixar would "prefer to continue our relationship with Disney" but that there are other studios "anxious" to align with it. A confident Jobs said that "the right deal is more important than the quick deal." Yet Disney, too, has leverage because of its marketing clout, born of its position as the world' s top producer of family entertainment. Disney' s bargaining position is enhanced because it' s entitled to half the profits on the next two Pixar movies, including DVD and video rights. Disney also can use Pixar characters for theme parks and other entertainment. While Disney and Pixar co-own the five films covered under the current agreement, Disney has more clout when it comes to any sequels. According to Pixar' s 2002 10-K report, "Disney' s decision governs" if there are disagreements between Disney and Pixar about whether to proceed with a sequel, except in very limited circumstances. ANIMATED ARGUMENT If Pixar dumps Disney for Warner Brothers, Sony or another Hollywood studio, Disney probably will force Pixar to abide by the 50-50 profit split on the next two films called for in the existing contract. That would delay a marked upturn in Pixar' s profits until 2007, the year after
Disney used the character of Mickey Mouse and others to create movies that customers enjoyed like “Beauty and the Beast” while Pixar was producing made up animated characters to create films like “Cars” and “Wall-E”. Disney was creating animated movies but struggling to generate the amount of money Pixar was making on producing only one movie a year. Disney wanted to grow in creating more animated movies and decided to buy out Pixar in 2006 for $7.4 million dollars. (Barnes, 2008) According to Disney’s CEO Robert
Disney’s tentpole strategy has been fairly successful throughout the Disney Studios lifetime. Even though this strategy worked in the past it may not be the best strategy moving forward, as there are advantages and disadvantages to this strategy. One advantage of this strategy is that the tentpole films attract movie going customers that think of the movies more as an event rather than just a film they want to see.“A $200 million movie is more likely than a $20 million movie to have elements that appeal to moviegoers--to have special value for them.”, said Horn. Just as with any bet, there could also be a risk and disadvantage. If the film fails, they would both have to take the fall instead of just Disney Studios. “When our
Pixar, being a leader in CG animations and having an exemplary track record of producing blockbuster hits, had a lot of potential suitors which include Warner Bros., AOL, Time Warner, Fox and Sony. Any media companies that strikes a deal with Pixar may instantly forefront the animation market.
Buying energetic, young and creative Pixar, Disney intends to regain lost ground. But, they must do that in a smart way, to satisfy the needs of the Pixar owners, shareholders and employees. Back to the ownership test, the Disney ownership of Pixar will produce a greater competitive advantage for them. They will lose a powerful competitor, and will produce something
Disney’s acquisition of Pixar had both benefits and implications for both parties involved. By acquiring Pixar, Disney was given access to Pixar’s proprietary technology, which was an important factor, as well as access to new characters. These characters provided a new source of income for Disney, not just for movies, but also to use in theme parks, merchandise stores, etc., meaning new characters would supply immense revenue streams for Disney in several forms. Disney also gained strengthened market power, as acquiring one of their rivals would give them a competitive advantage and would simultaneously make them more powerful in the market. Additionally, Disney was never very successful with their animated movies, and acquiring Pixar would
To conclude, Pixar has many opportunities that can be explored, in both the global and local markets. There is a lot of potential for
As a subsidiary company of Disney, one of the biggest companies in the entertainment industry, Pixar has strong financial support. Disney provides the production cost of the films, and it handles marketing and films promotions as well as distributions. Each of Pixar’s films made between $300 million and $1 billion at the box office, and two of them have exceeded $1 billion in income (Lynch, 2016).
DreamWorks Animation has released over 30 animated films since 1998. Among their highest grossing films are the Shrek franchise, Madagascar 3, and Kung Fu Panda 2. For this analysis I shall be looking at Shrek 2 and Kung Fu Panda 2, and examining what may make these movies a bit unsuccessful despite their success.
Known to be one of the largest producers of multi-media content, Walt Disney and Pixar greatly impacted the entertainment industry with the use of three-dimensional generated content. It quickly gained popularity with the release of its animated movies and especially got the attention of children from their sequels. With the growing popularity, the competition in the media industry began to increase. Disney was then faced with a difficult decision regarding its relationship with Pixar on whether they should acquire or not acquire the company.
Pixar Animation Studios was founded in 1979, initially specializing in producing state of the art computer hardware (Carlson, 2003). In 1990, due to poor product sales the company diversified from its core business and began producing computer animated commercials for outside companies. Success came for Pixar after the production of its first computer animated film ‘Toy story’ in 1995 (Hutton and Baute, 2007). Since then, Pixar has made many innovative animated feature films, with well known ones including - A Bug's Life, Toy Story 2, Monsters, Inc., Finding Nemo, The Incredibles, Cars, Ratatouille and WALL-E, six of which are in the top grossing animated
Management Report: Pixar Animation Studios Pixar has captured the minds and hearts of millions of viewers who celebrate and live with the characters to this day. The studio does not just make movies. They impact a generation. They mold the behaviors of the future. They give
Established in 1923, Disney Studios released the first ever full-length animated feature film, Snow White and the Seven Dwarfs in 1937. By 2015, Disney Studios employed about “6,500 employees, and spent $2 billion producing films annually”. Alan Horn, Chairman of the Walt Disney Studios, oversees five studios, that together made up Disney Studios. The Walt Disney Studios Motion Pictures ‘Disney Live Action’ and Walt Disney Animation Studios ‘Disney Animation’ are directly from Walt Disney’s original studio. The three others were acquisitions made during Bob Iger’s time as chief executive officer of The Walt Disney Company. The first was Disney's competitor animation studio, Pixar, which was purchased for $7.4 billion in 2006; second, Marvel Entertainment, which had its roots in comic books, for $4 billion in 2009; and finally the legendary filmmaker George Lucas’ Lucasfilm for $4.05 billion in 2012. During this time, Disney Studios began pursuing a “tentpole” strategy, which entails investing in higher budget films that would hopefully produce a larger profit by pulling in a large portion of the market. The larger profit would also help compensate for losses that may occur in smaller budgeted films. As it stands, Disney studios currently produces 10-12 films annually with approximately eight of them with production budgets in excess of $150 million. The current breakdown of tentpole films expected annually is as follows: two from Marvel, one from Lucasfilm, one from Pixar,