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This story first appeared in the June 21 issue of The Hollywood Reporter magazine.
In a normal summer, having Despicable Me 2 and Monsters University would be more than enough animated fuzzy-wuzziness to satiate audiences. But when you throw in Epic, Turbo and Planes (and Smurfs 2 for good measure), suddenly the high-stakes animation race has never been so crowded. By the time summer 2013 is done at the multiplex, Hollywood will have the answer to a billion-dollar question: Is there enough audience to go around?
The unprecedented glut of product points to a seismic shift in the animation business as new players such as Universal and Sony finally gain a stronghold and established companies like DreamWorks Animation, Fox, Disney Animation Studios and Pixar up their games. Family franchises can be incredibly lucrative if done right — between global theatrical sales (particularly international), home entertainment and merchandising. Pixar’s Cars franchise, for example, moved north of $10 billion in merchandise alone. If they don’t work, studios can lose tens upon tens of millions, with hundreds of jobs at risk.
“This will be the strongest summer for animation ever,” says DreamWorks Animation CEO Jeffrey Katzenberg. “Everybody tends to forget that it takes four to five years to make these movies, so with more companies producing these films, and some with much more regularity, there are going to be more summers like we are about to have.”
For the past handful of years, there have been no more than four or five studio animated films a year, plus a handful of indie titles. There are eight releases this year and 10 next year.
This has sparked a fierce battle for prime release dates between Disney and Pixar on the one side, and DreamWorks Animation and 20th Century Fox — now partners — on the other.
Late last month, Pixar and Disney Animation chief creative officer John Lasseter essentially declared war on Katzenberg by dating a slew of untitled Pixar and Disney Animation Studios films through 2018, going so far as to claim June 17, 2016, even though DWA already had put How to Train Your Dragon 3 there. Never before have a Pixar and DWA movie gone up against one another. Katzenberg and Fox, where Vanessa Morrison heads up Fox Animation Studios, retaliated by flooding the calendar through 2018 with their own untitled films, even planting one on June 16, 2017, a Pixar date.
More immediately, this summer’s slate includes five studio 3D toons, compared to the usual two or three that’s been the norm since the late 2000s. The onslaught coincides with many parents now being more discriminating about how often they go to the multiplex with their kids because of rising ticket prices (particularly 3D tickets) and the soft economy. There’s also Sony’s The Smurfs 2, a live-action/CG hybrid that will compete for the same dollars.
The first 2013 summer title out of the gate was Memorial Day entry Epic, produced by Fox Animation and its longtime comrade Blue Sky Studios. The film has underperformed, grossing $189.3 million worldwide to date, but it can’t blame overcrowding as it opened without any animation competition. Pixar prequel Monsters University doesn’t open until June 21 (early reviews, including THR critic Todd McCarthy‘s, have not been overly kind).
Universal and Illumination’s Despicable Me 2 hits less than two weeks later on July 3, in time for the lucrative holiday weekend. DWA’s Turbo comes out July 17, followed two weeks later by Smurfs 2. Planes, a spinoff of Pixar’s Cars franchise, opens 14 days after that on Aug. 9 after being diverted from a direct-to-DVD release in a move to boost toy sales, a backbone of the animation business. (These films also will have to compete with other family-friendly titles including Man of Steel, The Lone Ranger and Percy Jackson: Sea of Monsters.)
“There are 14 days between four films,” Katzenberg says. “Is two weeks enough? If you look at the summer playtime, every day is like a Saturday since kids are out of school. So those 14 days between each are the equivalent of seven weekends during any other time of the year.”
Not everyone is as Zen about the glut of product, particularly considering the financial risk. DWA and Pixar films often cost $150 million to $200 million to make, plus an enormous worldwide marketing spend (which ranges from $150 million to $175 million). “I don’t think it’s good for the industry,” says one veteran film distributor. “There are too many films, and some won’t fulfill their potential.”
Adds Universal Pictures chairman Adam Fogelson: “I’m not concerned for Despicable Me 2. As someone who roots for the whole industry to have a good summer, certainly there are a lot of entries and a greater risk of fatigue. I think the bar for capturing the public’s attention is higher than ever. However, if you have the goods, whether you are first in line or the last, you will succeed.”
Many box-office observers are placing big bets on Despicable 2 and Monsters University, the follow-up to the beloved Monsters, Inc., which grossed $562.8 million in winter 2001. Planes is more of an unknown, since it won’t bear the Pixar seal of approval. It was produced by DisneyToon Studios, the studio’s direct-to-DVD label. The test scores were so high that Disney says that Lasseter and his team decided to go the theatrical route.
Some have questioned whether consumers will be confused by the absence of Pixar’s name on advertising for Planes. And rivals say the theatrical run is a pure merchandising play. “Let’s call a spade a spade,” one producer says.
“Planes does take place in the same world as Cars, so it’s not crazy to think there be may be some confusion,” says Walt Disney Studios chairman Alan Horn. “But the bottom line is that it’s not a Pixar film … ultimately it’s about whether audiences are going to enjoy themselves at the theater, and with this movie they will.”
The stakes are especially high for Turbo, the second DWA film that Fox is marketing and distributing after The Croods, which earned a solid $570.2 million this spring, the majority of it overseas. Turbo has the advantage — and disadvantage — of being an original film amid a sea of sequels and spinoffs. Producing and marketing an original animated event pic such as Turbo or The Croods takes incredible resources and know-how. When they work, they turn into mega-franchises and possible billion-dollar merchandising efforts. “Nothing takes more time, energy and setup,” says another studio chief. (And when they don’t work? No happy ending. DWA’s Rise of the Guardians, distributed by Paramount, took in only $303.7 million worldwide and resulted in an $87 million write-down and 350 layoffs at Katzenberg’s company.)
“Is the marketplace big enough to accommodate all of these movies?” asks Katzenberg. “Traditionally, the answer has been that success breeds success and that a good movie will make people want to return to the theater to see another movie.”
Going forward, the most ambitious blueprint belongs to partners-in-crime DWA and Fox. Beginning next year, Fox is set to release three DWA titles annually instead of two. And in 2017 and 2018, Fox is on deck to turn out two or three animated films of its own for a combined total of five or six event movies, a never-before-heard-of number for one studio. Fox Filmed Entertainment chairman-CEO Jim Gianopulos — who stressed the studio’s growing animation prowess at CinemaCon, the annual gathering of theater owners — says it was in keeping with this goal that the studio and Katzenberg dated so many untitled and undisclosed films so far after Disney did the same.
“Obviously, it makes sense to put down dates and plant your flag,” says Gianopulos. “A movie like Alvin and the Chipmunks, or another broad family film, could ultimately take one of those dates. So those slots might not be devoted to a DWA or Blue Sky movie, but the great majority will be. We have some ideas of what those films will be, but we just aren’t ready to announce them.”
Disney is likewise emboldened. Pixar remains an unparalleled box-office brand, while Disney Animation Studios is enjoying a renaissance with Tangled and Wreck-It Ralph. Disney’s refrain was similar in terms of why it took the unusual step of dating so many untitled films. Executive vp distribution Dave Hollis says consumers have come to expect a Pixar movie in the third week of June and a Disney Animation Studios title around Thanksgiving. “We felt like this was an opportunity to send a signal,” he notes.
Horn sounds a humorous note in commenting on the animation arms race. “Obviously, the more crowded the field, the more difficult it is for everyone,” he says. “But this is a competitive business. From my perspective — and I do believe this is reasonable — the clear solution is for Jeffrey and Jim to stop making so many animated films.”
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Women in Entertainment
Women in Entertainment 2022