Burbank, Calif.
ON April 4, 2003, Glen Keane, one of the Walt Disney Company’s most respected animators, summoned about 50 of his colleagues to a third-floor conference room on the lot here to discuss the war brewing at the studio. Disney’s animators had settled into two opposing camps: those who were skilled in computer animation and those who refused to give up their pencils.
Mr. Keane, a 31-year veteran who created the beast from “Beauty and the Beast” and Ariel from “The Little Mermaid,” was a Disney traditionalist. But after a series of experiments to see if he could create a computer-animated ballerina, his opposition softened. So he invited the 50 animators to discuss the pros and cons of both art forms, calling his seminar “The Best of Both Worlds.”
For an hour, Mr. Keane painstakingly ticked through the pluses and minuses of each technique while the other animators listened quietly. After a few tentative questions, the crowd burst into chatter, as animators shouted over one another, some arguing that computers should not replace people while others expressed fears that they would be forced to draw by hand.
In a recent interview, Mr. Keane recalled that Kevin Geiger, a computer animation supervisor, then stood up and demanded of him, “If you can do all this cool stuff that you’re talking about – that you want to see in animation – but you have to give up the pencil to do it, are you in?” Mr. Keane hesitated before answering: “I’m in.”
Three weeks later, the company’s animators were told that Disney would concentrate on making computer-animated movies, abandoning a 70-year-old hand-drawn tradition in favor of a style popularized by more successful, newer rivals like Pixar Animation Studios and DreamWorks Animation. The results were nothing short of a cultural revolution at the studio, which is famous for the hand-drawn classics championed by its founder Walt Disney – from “Snow White and the Seven Dwarfs” to “Peter Pan.”
This Nov. 4, some two and a half years after that decision, Disney will release “Chicken Little,” the first of four computer-animated films being developed at the newly reorganized studio. The company is hoping that this movie, along with others like “Meet the Robinsons,” “American Dog” and Mr. Keane’s “Rapunzel Unbraided,” will return a reinvigorated Disney to its past glory.
There is a lot more than pride, however, riding on their success. Animation was once Disney’s heart, a profitable lifeline that fed the company’s theme park, book and home video divisions. And reviving profits is as essential to Disney these days as regaining its storied reputation. Just last week, the company said it expected its studio to lose as much as $300 million in the fourth quarter because of poor performance in its live-action division. Over all, the Disney Company had net income of $2.27 billion in the first three quarters of fiscal 2005 on the strength of its ABC network and its ESPN sports cable channel.
“From a psychological standpoint, ‘Chicken Little’ is very important for Disney,” said Hal Vogel, a financial analyst who has covered Disney for years. “Everything is touched by animation and if they don’t refresh it, it becomes frayed at the edges.”
The box office numbers show how far the sky has fallen. The studio reached the height of its most recent popularity with the 1994 release of “The Lion King,” which brought in $764.8 million at the worldwide box office. By contrast, the last nine animated movies Disney either made or acquired took in only $758.3 million combined. “The Incredibles,” the 2004 film created by Pixar, brought in $630 million – nearly as much as Disney’s last eight animated movies.
So it should come as no surprise that when Mr. Keane stood up and made his passionate plea in 2003, Disney was in the midst of an identity crisis. It had to reinvent itself – or wither. “When everybody feels pretty good about themselves, and you have Champagne coming out of the water fountain, it’s almost like we’ve got to burn the place down,” said Mark Dindal, the director of “Chicken Little,” in an interview in August that also included the directors of Disney’s three other current animated-film projects.
But the competition in animated films is now tougher than ever. It is also fraught with enough sibling rivalry to make the wicked stepsisters in “Cinderella” blush. To begin with, there’s Jeffrey Katzenberg, who left Disney in 1994 – after a spat with the chief executive, Michael D. Eisner – to become a co-founder of DreamWorks SKG. The studio’s offshoot, DreamWorks Animation, is now one of Disney’s fiercest rivals.
Then there is Steven P. Jobs, the founder of Apple Computer and the Pixar chief executive who took a swipe at Disney last year, calling its animated sequels “embarrassing.” Mr. Jobs also sparred with Mr. Eisner, despite the fact that the two companies have been partners since 1991. (That deal was brokered by Mr. Katzenberg.) Mr. Jobs agreed only recently to resume talks with Disney about a new distribution agreement that would start in 2007.
Against such a backdrop, “Chicken Little” is almost certain to be one of the most scrutinized movies of its kind – not only by moviegoers, but also by investors, competitors and fellow animators alike.
THIS is not the first time that Disney has faltered. After Walt Disney died of lung cancer in 1966, the studio was in a state of paralysis, as animators second-guessed themselves about what kind of movies Mr. Disney would have made if he were alive. The studio released a string of mediocre films in the 1970′s and early 80′s. And frustrated young animators, like the director Tim Burton and John Lasseter, who created “Toy Story” at Pixar, where he is now creative director, left Disney.
So, by 1984, when Mr. Katzenberg joined Disney to oversee its film business and animation, the studio was in shambles. He is credited with a turnaround, releasing animated blockbusters like “The Little Mermaid,” “Beauty and the Beast,” “Aladdin” and, most famously, “The Lion King.”
But in 1994, at the height of Disney’s resurgence, Mr. Katzenberg left because Mr. Eisner would not appoint him Disney’s president. That year he helped to create DreamWorks SKG, where he set up an animation studio of his own.
The move put Disney on the defensive. According to Disney executives, Mr. Katzenberg recruited heavily from the company, driving up salaries. And the studio lost some of its creative spark after his departure. Disney, too, was facing increasing competition: Pixar released its first computer-animated movie in 1995, the hit “Toy Story.”
By 1998, Disney’s animation division had ballooned to 2,200 employees, far more than the company could afford, given that it was churning out fewer blockbusters. In 2001, Disney began laying off animators and closing studios. Ultimately, two out of every three employees in the division would lose their jobs as Disney closed offices in Paris, Orlando, Fla., and Tokyo.
David Stainton seemed an unlikely candidate to become president of Walt Disney Feature Animation in 2003. In the early 1990′s, he worked in creative development and later ran the Paris studio. Mr. Stainton, who has an M.B.A. from Harvard, was best known for running Disney’s television animation division and overseeing the company’s direct-to-video and sequels business, both of which were profitable but lacked the sex appeal of original theatrical films.
Mr. Stainton, who became Disney’s third animation chief in as many years, was not prepared for the trouble he encountered his first week. He said he had been warned then that the movie “My Peoples,” a tale of star-crossed lovers that combined live action and animation, needed an overhaul. By contrast, he was told that the computer-animated “Chicken Little” was a winner.
“I was sitting there at the screening room watching it and I thought: ‘Oh my God! What am I going to do?’ ” Mr. Stainton, who is 43, recalled in an interview in his office last month. “This is the movie that’s working? I honestly almost started to cry.”
Mr. Stainton shut down “My Peoples.” As for “Chicken Little,” Mr. Stainton said he told Mr. Dindal, the director who began the project in 2001, that the story line wouldn’t work: it was about a young girl who went to summer camp to build confidence so she wouldn’t overreact.
“Just ripped the Band-Aid off,” said Mr. Dindal, describing the conversation with his new boss. “He’s kind of like that.”
Mr. Dindal took a three-month break and revised the script, turning “Chicken Little” into a tale of a boy trying to save his town from space aliens.
At the same time, Mr. Stainton was contemplating what to do about the standoff between Disney’s two camps of animators: the techies and the traditionalists. When he was hired, Mr. Stainton said, both Mr. Eisner and Richard Cook, the chairman of Walt Disney Studios, said they wanted Disney movies to be wittier, contemporary computer-animated comedies with a dramatic twist (in other words, said one Disney executive, more like DreamWorks’ “Shrek”).
But Mr. Stainton said he knew that he needed an influential animator on his side if he were to succeed. “I sort of had an inkling that it would take artists to convince other artists that this was something viable,” he said. So, in February 2003, a month after he was hired, he responded enthusiastically when Mr. Keane met with him and Mr. Eisner and presented six hand-sketched scenes for “Rapunzel Unbraided,” a heartwarming romance based on the fairy tale. Mr. Stainton and Mr. Eisner told Mr. Keane that they would greenlight the film, but that there was one caveat: it had to be computer-animated. Mr. Keane balked.
Mr. Stainton said he replied, “Glen, I’m not asking you to go make a movie with humans that look like ‘Final Fantasy,’ ” referring to the stiff figures in the 2001 computer-animated dud. “I’m asking that you – and I know it doesn’t exist out there – I’m asking you to go create it. You have to create something new.”
“I loved ‘Shrek,’ ” Mr. Keane responded. But the characters, particularly Princess Fiona, looked plastic to him. “Every frame of that film was a bad drawing to me, personally,” he said.
ONCE word of the meeting got out, the traditional artists rallied around Mr. Keane. “I couldn’t walk down the hallway without running into 10 different people and them saying, ‘We’re praying for you,’ ” Mr. Keane said.
But whether “Rapunzel Unbraided” was made or not, it offered a politically expedient way for Mr. Stainton to force a dialogue. So, on April 4, Mr. Keane held his “Best of Both Worlds” seminar. And at the end of that month Mr. Stainton lobbed another grenade. He told more than 525 employees gathered at a town hall meeting that the studio would stop making hand-drawn movies for the foreseeable future. Those interested in computer-generated animation could sign up for a six-month “C.G. boot camp.”
“What I was saying to them was, ‘You’ve got to embrace it or there isn’t going to be a place for you,’ ” Mr. Stainton said.
Some animators resisted. “There was a period of time here when they were buying computers and we never really saw anything,” said Chris Sanders, the director of “American Dog” who created “Lilo and Stitch.” “You’re like, ‘Well, do we have computers?’ ‘Yes, we do.’ ‘Really? Where are they?’ ‘They’re around.’ ‘Where, exactly?’ ‘Downstairs.’ ‘So, computer animation, we can we do that?’ ‘Uh-huh.’ ‘Like theirs?’ ‘Uh-huh.’ ” Mr. Sanders laughed. “It went around like that.”
The announcement did little to soothe the warring camps. Some traditionalists refused to sit with the computer set at lunch, Disney executives said. They voiced their complaints to Roy E. Disney, then the studio’s animation chairman and Disney board member, who was locked in his own battle with Mr. Eisner, having vowed to oust him as chief executive.
“There was so much tension and frustration and you couldn’t talk about it civilly, it seemed, without people becoming angry,” Mr. Keane said. That fall, Disney’s animators met again to hash out their differences, this time on neutral territory, at the Huntington Library in San Marino, Calif.
Mr. Stainton still had movies to make. And he gave the green light to “American Dog” and another film, “Meet the Robinsons,” a story of an adopted boy who invented a time machine; it is to be directed by Steve Anderson. Of course, there was still “Chicken Little.”
Mr. Dindal said he threw out 25 scenes. Along with the movie’s three credited writers, he talked to six others who helped with character development. The director held nine screenings with children and parents. And he said he received what seemed liked “thousands and thousands” of notes from Mr. Stainton to make the story funnier.
Mr. Dindal recalled a screening where he delivered a presentation outlining the movie’s main points for about 125 animators. “I said to everyone, you can send any notes you want, but notes that speak to this, what the movie’s really about, those are the ones which are going to be helpful,” he said.
But as much turmoil as there was within the studio, there was plenty outside, too. In November 2003, Mr. Disney quit the Disney board after learning that he would be asked to step down at the next board election. While Mr. Disney did not spend much time on the lot, he was the public face of Disney animation and blamed Mr. Eisner for the studio’s shortcomings.
Mr. Stainton said that Mr. Eisner had supported his changes. “The whole business between Roy and Michael was very distracting,” Mr. Stainton added, “and the ability to sort of put our heads down and just do the work and not involve ourselves was helpful.”
Disney animation suffered another blow on Jan. 29, 2004, when Mr. Jobs announced that Pixar would end talks with Disney to continue its 14-year partnership and would seek a competitor to distribute its films after the release of Pixar’s next movie, “Cars.” Six days later, Mr. Jobs criticized Disney’s animators, telling Wall Street analysts that Disney’s “Treasure Planet” and “Brother Bear” were bombs and calling the studio’s sequels “embarrassing.”
“It was the best thing that could have happened to us,” said Mr. Cook, the chairman of Walt Disney Studios. Weeks later, Mr. Cook met with the animators and told them that it was time to get on with making great movies. “We needed to get ourselves back on track,” he said. “They knew it. Enough of the Disney bashing; enough already. The way to stop all that is to win. And that’s what we set our sights on.”
If there is any question about whether there is life for Disney after Pixar, consider the following: Last June, Disney caused a ruckus at the industry’s largest computer-animation conference in Los Angeles when it set up a large poster in front of its booth – and facing Pixar’s – to advertise the preproduction of “Toy Story 3.” Mr. Jobs had sought to make the movie, but Mr. Eisner said no when Mr. Jobs wanted it to count toward the five that Pixar owed Disney as part of its partnership agreement.
For many of those in attendance, it was an in-your-face gesture that showed Disney was prepared to go it alone. (“It was not intentional that it faced the Pixar booth, I promise,” said Mr. Stainton, a boyish grin sliding across his face.) But it was also part of a larger public relations campaign to show that Disney was viable again. Disney was interviewing new recruits, showing off new technology and even having a party, attended by 200 people, on the roof of the Standard, a hotel in Hollywood.
“We need to show people that we’re back, that we are right up there doing cutting-edge stuff and stuff that is interesting and looks beautiful to anyone,” Mr. Stainton said. “Last year, we had people who came up and said, ‘You know, I didn’t realize that you guys were doing anything.’ Swear to God. People really thought we were out of business.”
Both Mr. Jobs and now Robert A. Iger, Disney’s president who will become chief executive on Oct. 1, are cautiously optimistic that a Pixar-Disney deal can be struck that will solidify what has been a long and profitable relationship. But that won’t solve all of Disney’s problems.
In 1995, only six animated movies were released – half of them from Disney, according to the company. By contrast, nearly 20 animated films are expected to be released in the next two years – three from Disney. That has led some Wall Street analysts to suggest that as animated movies become more mainstream, they will no longer command the huge profits that studios have enjoyed from them.
Already this year, both DreamWorks and Pixar experienced higher-than-expected returns of DVD’s sold to retailers, suggesting that consumer demand was softening. Piracy is a concern, and movie studios haven’t yet devised a way to combat it. And studios may be headed for a showdown with theater owners if they push to distribute their movies simultaneously on DVD and in theaters.
But Disney’s biggest challenge may be to overcome the notion that, when it comes to animation, many moviegoers may no longer have much confidence in Disney. Indeed, the company’s animators today have more in common with their predecessors than their competitors at Pixar and DreamWorks. When animators created “Snow White and the Seven Dwarfs,” the studio’s first theatrical offering in 1937, it was referred to as “Disney’s Folly” before its release.
“How hungry were they?” Mr. Dindal said, referring to “Snow White’s” animators. “It’s fun to be at a place where everybody’s hungry for something, as opposed to being well fed.”
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