MCN Blogs
David Poland

By David Poland poland@moviecitynews.com

DreamWorksAnimaton @ Paramount Makes Sense… But Does WB Make More Sense?

It’s funny to see the New York Times in the wild speculation business, as with Will DreamWorks Animation Abandon Paramount?. The reason the blog entry is mostly speculation is because Brooks Barnes (surprise!) hasn’t actually thought it out. He throws out the notion that DWA could leave Paramount (which has done a good job for them), but never gets down to the nitty gritty…
Where would DWA go if they left Paramount?
Is there any chance that Disney would add yet another animation producer to its distribution schedule?
Would Fox or Sony move off of their animation ambitions to make room for two DreamWorks animated titles a year?
Would DWA be willing to make a long-term deal with Universal with the unknown quantity of Kabletown hanging over the company’s head?
That leaves Warner Bros, in my view, as the only legitimate alternative. They have destroyed their animation legacy over there and haven’t released an animated movie that they funded since 2006. The last movie they released with any in-house effort added to the production was Looney Tunes: Back in Action in 2003.
When you think about it, the company with the greatest kids-first franchise in history, Potter, has failed to leverage it with the most obvious fit… animation. DWA comes to the table with almost no risk for a studio, but a solid two-picture-a-year animation output with what will probably be an 8.5% distribution fee this time around.
And maybe Barnes was signaling something without typing it out when he mentioned the international market, where many feel that WB is stronger than any other studio. (Don’t tell Fox.)
The one problem with a WB deal is that they have such a full schedule already and that their non-Potter family product has had some success, mostly in live-action films with animation in them. Does the studio that tends to release the most movies each year cut back by a few? And for that matter, does DWA think Sue Kroll and her team will be as strong domestically as Megan Coligan’s… or can they just put Terry Press back on the case for a year to get it moving before the pieces work right?
If you figure that DWA movies can do about $350m each worldwide, a 2% cut to the distribution deal (taken against gross) means about $7m per title back into the DWA coffers. It’s not live-changing, but for the publicly traded company, it is a positive showing.
So if all things were even and we assume that WB can do what Par has done with the pictures domestically, forcing Paramount to take a cut in their distribution fee would probably be the safest choice. If you think, however, that WB International can mine more out of these movies…


157.5

2 Responses to “DreamWorksAnimaton @ Paramount Makes Sense… But Does WB Make More Sense?”

  1. Direwolf says:

    I’ve read some Wall Street research on this topic and I’ve seen some analysts speculate that DWA could do better than 8%, maybe as low as 5%. 5% seems awfully low but I’d be curious if you think they could break the 8% barrier.
    BTW, I am long DWA in the media hedge fund I manage. Bought it just after the week open for Dragon thinking the legs would be good. Got a nice profit though lost a couple bucks the last two days since the first quarter earnings report. I think the report was fine but the stock had built in high expectations running $5 in just a couple of weeks. DWA usually rallies into its film releases then sells off after. My original plan, still intact was to hold until just before Shrek 4. the film is almost certainly review proof but the early write-ups off Tribeca are poor. That is probably hurting the stock a bit presently.

  2. EthanG says:

    You hit the nail on the head Dp…WB’s slate is simply too full at this point, and they have the upcoming “Yogi Bear” movie in the pipeline. The way they have distribution deals with everyone from Joel Silver to Alcon Entertainment (now amping up production due to Blind Side and ElI besides major in-house releases from New Line makes it unfeasible. They have 8 releases in the next four months.
    Universal, as is obvious with its massive schedule upheaval this week, doesn’t have the cash….Sony took up so much ink hyping the success of “Cloudy Meatballs” it seems obvious that it’s committed to in-house work.
    To me, Fox actually seems like a better fit…it only has one non-franchise animated film in the pipeline (Rio), and has a proven track record marketing animation internationally (see Ice Age 3’s WW)….and their slate isn’t as busy as WB’s as long as you don’t count Searchlight. Besides…Fox has the cash.
    On the other hand though, I’d be shocked if Paramount lost Marvel and DWA quickly in succession. Its releases have been few and far between lately but they haven’t had any serious missteps…and the track-record with DWA (heck even Monsters vs Aliens turned into a cartoon series) has been pretty damn great.

The Hot Blog

Quote Unquotesee all »

“The thought is interrupted by an odd interlude. We are speaking in the side room of Casita, a swish and fairly busy Italian bistro in Aoyama – a district of Tokyo usually so replete with celebrities that they spark minimal fuss. Kojima’s fame, however, exceeds normal limits and adoring staff have worked out who their guest is. He stops mid-sentence and points up towards the speakers, delighted. The soft jazz that had been playing discreetly across the restaurant’s dark, hardwood interior has suddenly been replaced with the theme music from some of Kojima’s hit games. Harry Gregson-Williams’ music is sublime in its context but ‘Metal Gear Solid 4: Guns of the Patriots’ is not, Kojima acknowledges, terribly restauranty. He pauses, adjusting a pair of large, blue-framed glasses of his own design, and returns to the way in which games have not only influenced films, but have also changed the way in which people watch them. “There are stories being told [in cinema] that my generation may find surprising but which the gamer generation doesn’t find weird at all,” he says.
~ Hideo Kojima

“They’re still talking about the ‘cathedral of cinema,’ the ‘communal experience,’ blah blah. The experiences I’ve had recently in the theatre have not been good. There’s commercials, noise, cellphones. I was watching Colette at the Varsity, and halfway through red flashes came up at the bottom of the frame. A woman came out and said, ‘We’re going to have to reboot, so take fifteen minutes and come back.’ Then they rebooted it from the beginning, and she had to ask the audience to tell her how far to go. You tell me, is that a great experience? I generally don’t watch movies in a cinema at all. Netflix is the future. It’s the present. But the whole paradigm of a series, binge-watching, it’s quite different. My first reaction is that it’s more novelistic, because if you have an eight-hour season, you can get into complex, intricate things. You can let it breathe and the audience expectations are such that they will let you, where before they wouldn’t have the patience. I think only the surface has been touched with experimenting with that.”
~ David Cronenberg