Prisoner,
I still stand by my statement that Pixar will not be able to find a partner with Disney’s resources. Most other studios rely on conventional advertising and then license out aspects of the production to third party companies for profit purposes. You gave some examples of other movies but in every single case, those movies were part of a pre-existing franchise. The first Star Wars for instance, (which Fox actually gets 7.5% for – not 10) was not exactly well marketed in the early days and to this day owes most of its financial success to the way that Lucas owned companies have marketed and licensed the franchise in the form of books, games, collectables, THEME PARK RIDES and everything else you can imagine to the cult following that they themselves have actively cultivated and nurtured.. The success of LOTR has a lot more to do with it being a truly good adaptation of what many consider to be the best selling international series of books of all time (behind the King James Bible) – and a very similar case could be made for Harry Potter which had everything from books to games, to candy even before a move deal was in place….
When a movie with no pre-existing franchise behind it breaks box office records on opening weekend it has almost nothing to do with the movie itself and almost everything to do with the marketing behind it - hence the reason that most movies make nearly half of their entire domestic release gross on the opening weekend alone….
In any event, I’m not trying to say that Pixar should stay with Disney or that they will even be sorry for it if they don’t. I think that Finding Nemo probably wouldn’t have grossed $340 million domestically if Disney weren’t involved (in the business side of things) but even at $250 million or $300 million Pixar would have made a lot more money off it than they are making now and understanding this, if I were them I’d go into negotiations with this in mind myself.
What I don’t understand is what so many people think would have been so great for Disney giving Pixar what they wanted. Either way, Disney’s high profile connection to Pixar films was coming to an end as were Disney’s high profits and everyone seems to be totally overlooking this.
The sudden drop in Disney stock right now that we are all hearing about as a result of the Pixar news has about as much to do with reality as the financial internet bubble did back in the late 90’s because it does nothing to hurt the actual potential value of Disney over the next two years.
It isn’t like if they had struck a deal, Disney would still be making lots of money off Pixar films and be able to use their content like they have all along. Their profits from all future Pixar films would still have become of very little significance in two years to Disney’s financial bottom line anyway.
If they had signed a new deal, Pixar was going to own the movies; they were going to control marketing; they were going to have all merchandising rights and future Pixar releases would probably look a lot like Spiririted Away where the movie poster and DVD box say in a very small serif font, “Walt Disney Studios Presents” without even the studio logo and zilch worth of media credit. They would also have had to negotiate the way they use Pixar films in the parks the way they had to negotiate the use of Star Wars and Indiana Jones and the Disney tie-in of new creations would have fit in with the name “Disney” about as much as those two brands do right now. In short, these would have no longer been Disney movies in any way shape or form.
It also seems that Pixar was not only trying to re-negotiate the terms of the upcoming two movies but also to negotiate a redistribution of ownership on aspects of all of the previously completed ones as well.
Plus, as I mentioned in a previous post, they would have had to place Pixar movies in prime spots instead other Disney owned properties or in direct competition with them. Finding Nemo was competing with Freaky Friday, Pirates of the Caribbean and Spy Kids 3D (off the top of my head) during its time in theaters. Of course, since Disney stood to make a lot off Nemo, this didn’t matter but at less than 10% of that 340 million, they’d have ultimately made about as much as they did off The Lizzy McGuire movie this year which cost about $17 million to make and made over $42 million in the box office. Throw in the profits for the soundtrack, video sales and rental contracts with companies like Blockbuster, associated merchandising and what it has done to help the sales of her current CD which is produced by Disney-owned Hollywood records and that movie has done a lot more for Disney shareholder than Nemo would have under the contract Pixar wanted. And remember, Nemo was a record breaking blockbuster smash success – something that even Pixar says they don’t expect to repeat or top anytime soon.
As a matter of fact, to put things in perspective, Disney has made more off the Lord of the Rings series of movies for which they had absolutely no direct involvement and no marketing or financial responsibility for than they would have off of Finding Nemo if it were made under the contract that Pixar was looking for
Deal or no, the out come for the end of the existing contract was going to be lose-lose for Disney and I honestly believe that Disney chose the route that would cause them to loose the least.
On a side note, I don’t think the announcement of plans for Toy Story 3 was intended as a threat but it is sort of ironic. John Lassiter of Pixar wanted to make Toy Story 3 (Pixar WAS interested in sequels) but Steve Jobs wanted it to count toward the current 5 movie deal which was great for Pixar but not for Disney since they’re free to go off and make it on their own… What is funny is that if they mange to do a good job of it (which is speculative at best to many) they stand to make a lot more off it than they would have by allowing it under the current contract because even if it doesn’t do as well as Toy Story 2, if it gets even remotely close, Disney keeps 92% of everything from that movie as apposed to the roughly 58% that it would have gotten with Pixar involvement which is a very large margin…
So how is this ironic? Pixar has about as much incentive to wish Disney well with this third movie as Disney would for any future release of a Pixar film had they struck the deal Pixar wanted because Pixar will get 8% of whatever the film brings in without their involvement in any way – the same amount they were allegedly trying to offer Disney for distribution of future Pixar releases…
