What is the deal with all you Disney/Pixar Naysayers?

[DancingBear]

Originally posted by CasualObserver
...It still doesn't change the root of the issue - Pixar wanted it to count (regardless of the 10-K statement) and Disney didn't.

I would say that this whole issue started with Pixar not having confidence in their product and made a contract with too long of a term. They want it to end, as soon as possible.

Personally, between the two, Disney's history doesn't put me on their side in this.

First, the film Pixar wanted to count was TS3. They didn't get suckered into anything on TS2. Both sides decided to change TS2 from a video release to a theatrical release. And the fact that they specifically dealt with this issue in TS2 means Pixar's "demand" that TS3 count was clearly overreaching.

Second, I don't know if it's about Pixar signing "too long" of a contract. Pixar's feature-length production was a fledgling business, which requires big cash. The contract with Disney gave them a chance to hedge their risk, to learn about the business from the major player in the industry, and to partner with the best distribution and marketing player in the family entertainment business. And it was not only prudent, but it became a wildly successful partnership.

I don't think Pixar lacked confidence in its product, exactly, but even they would not have predicted an unbroken string of successes at that time---you'd be foolish to do so in that industry.

I'm not sure what you mean by your last line. To me, this isn't a good guys vs. bad guys story. It's just business. This wasn't a case of Pixar's creative folks suffering under the yoke of Disney---rather, it was Pixar's very worldly executives trying to find a way to financially exploit Pixar's string of successes and renegotiate the deal. That's not evil on Pixar's part--it was worth a shot--but it certainly doesn't make Eisner the bad guy, either.

I think Eisner made the calculation that (1) the contract was on Disney's side, (2) there wasn't enough in it for Disney to renegotiate (the terms of any "proposed" new deal weren't attractive), and (3) he could wait to renegotiate the contract until later, without being significantly disadvantaged in doing so (which seems to be correct at this time).

[In fact, if you assume, as seems quite likely, that Pixar wasn't interested in a new long-term deal at all, there is really no reason why Eisner ever would have let TS3 count under the contract. That would mean getting TS3 instead of Pixar's last marginal new movie. So, it would actually be betting against Pixar's talent to do that---thinking that a second TS sequel would beat a new Pixar feature.]

 

[airlarry!]

DB:

If I read your post right, you are revising history. It was TS2, not TS3.

The facts during the ugly, and somewhat public mess, were that Pixar was asked to develop the DTV sequel to Toy Story. When one of the partners, I believe it was Disney but I could be mistaken, realized that they had as great a story and concept with TS2 as they had with TS1, Pixar was asked to ramp up the production into a full-fledged theatrical release.

Go back to this situation for a second, before you comment.

If you were asked to ramp up your production into a full fledged movie, and that production, by all accounts was top notch and release worthy, (heck many people still consider, myself included, TS2 a better movie than TS1) wouldn't you have considered it to be outside of the agreement? Especially when they came to you and asked you to release it, and spend more money, and spend more labor on it?

All that labor and money had to somehow be taken away from developing projects, so I know the answer to that would be a yes.

Obviously, they settled their differences. But by all accounts it is clear that Pixar has forgiven, maybe, but not forgotten.

Isn't there one eensy teensy tiny little part of the back of your mind that whispers that maybe Ei$ner was a little too greedy, that he pushed Jobs a little too hard, that he was counting on John L's history with the company a little much, that Mr. Media Mogul might have made a mistake here?

If not, check out the contract Bruckheimer has with Disney. Why doesn't Pixar deserve the same?

 

[DancingBear]

If it was TS2 and not TS3, I apologize for the error. And, perhaps I need to get a copy of the original agreement to confirm; however, note this from the Pixar 10-K filed in 1997 (for calendar year 1996):

The Co-Production Agreement also contemplates that with respect to theatrical sequels, made-for-home video sequels, television productions, interactive media products and other derivative works related to the Pictures, Pixar will have the opportunity to co-finance and produce such products or to earn passive royalties on such products. (emphasis added)

The 10-K then goes on to describe the TS2 direct to video sequel in the works.

So, before this situation arose, Pixar acknowledged that theatrical sequels might exist, and would be part of the "derivative works." They would have the opportunity to co-produce the derivative works, but no obligation to do so.

Later in that same 10-K, in the extended description of the Co-Production Agreement, it says:

Pixar is to be given the option to co-finance and produce, or to participate on a passive financial basis with respect to, a Derivative Work that is (i) a theatrical motion picture, (ii) a made-for-home video production....If Pixar elects to co-finance and produce a Derivative Work, the Co-Production Agreement provides for the following: (i) with respect to theatrical motion pictures and made-for-home video productions, the terms and conditions of the Co-Production Agreement are to be extended to cover such Derivative Works, subject to certain exceptions....

A Derivative Work that is a theatrical motion picture would not count towards the five Pictures to be produced under the Co-Production Agreement. (emphasis added0

So, the answer to your question:

If you were asked to ramp up your production into a full fledged movie, and that production, by all accounts was top notch and release worthy, (heck many people still consider, myself included, TS2 a better movie than TS1) wouldn't you have considered it to be outside of the agreement?

IS NO! From Pixar's own summary of the agreement, there does not seem to be any ambiguity in the contract on this issue. TS2 was a Derivative Work, and therefor DID NOT COUNT, whatever the format.

Yes Disney may have ASKED Pixar to co-spend the extra time and money to turn TS2 into a theatrical sequel, but was for both parties' benefit, and both parties made many extra $$$ for that decision. Pixar took a run at revising the contract at this point, but I still don't see that they were offering anything significant back to Disney to modify the contract.

Sure, Eisner could have made a mistake here. But, so far it appears to me that the only alternatives offered here are (1) Eisner should have given Jobs whatever he wanted, because then Jobs would have warm, fuzzy feelings for Eisner and they would be able to cut a deal now, or (2) Eisner should have tried to cut a new long-term deal at that time. I find both of these unconvincing.

 

[CasualObserver]

DB,

From your 10-K research (much thanks for it). It would appear to be the case, that Pixar made the picture with full knowledge that it wouldn't count towards the 5 picture deal, then tried to make it count after the fact. (It is TS2 that is the problem)

I think the bottom line is that Pixar didn't believe in themselves enough. Once TS2 became even a bigger hit than TS1 they regretted letting it not count toward the 5 picture agreement. They must have thought it would be an okay money-maker but not to the degree it really became.

Now, Pixar has become a powerhouse and is itching to flex their muscles on their own. When I said they made the contract too long, I meant that IMHO if Pixar really knew what they had they would have negotiated for fewer pictures. After TS2, it appears they realized what they had.

It appears to be much like buyers remorse, only with a bunch more zero's after the price...

 

[CasualObserver]

I feel the need to perform a query for Mr. Voice, although he needs not my help.

from the very first post in this thread:

My response is "where would pixar be without the DISNEY name to put on its movies". Sure..... they are a powerhouse right now. But do any of you honestly think that CGI animation would be as widely accepted today if it wasn't Pixar's relationship with Disney that brought it "main stream"? Would Pixar be making $100 million blockbusters - or would they be making commercials for Pepsi? Take a look at movies like Final Fantasy. A CGI movie without the Disney/Pixar name - and a flop. Sure SHREK did good - but hell... until I started reading this board... I figured it was a Disney/Pixar movie. In fact.... I only found out from reading a post on Jimhillmedia.com recently that ICE AGE was NOT a Disney/Pixar movie.

So your argument about "No one" is false. Your premise is false. The reason Mr. Voice made his argument was exactly because many (and I'll be more than happy to keep posting results). There are plenty who take the position that its been the Disney brand that has made Pixar successful. In the entertainment business, it's the product that makes itself successful, not the label.

Would you like more examples?

Casual Observer