Disney and Pixar talks could end their quarrel

Disney and Pixar talks could end their quarrel

By Nic Hopkins

THE Walt Disney Company and Pixar, which fell out spectacularly a year ago, are seeking to patch up their differences and renew the most lucrative pairing in Hollywood history.

Just over a year after the two film studios announced an end to their partnership, which has produced six consecutive global blockbusters and box office receipts of $2.7 billion (£1.4 billion), a new deal could be on the table.

Dick Cook, the head of Disney’s film studios, told The Times that it was “definitely our desire” to strike a new deal with Pixar in place of the one that will expire with the release of Cars next year.

“This has been probably the most successful relationship in the history of Hollywood,” Mr Cook said. “We’ve had a great working relationship with [Pixar]. It’s been about as easy as any has ever been in terms of making movies and distributing and marketing them,” he added during a visit to London this week.

“It’s definitely our desire to further the relationship with Pixar for years to come, and develop it even more, and we’re hopeful they feel the same way,” Mr Cook said.

Disney distributes all of Pixar’s films in exchange for 12.5 per cent of box office revenue, and the two companies split the profits from spin-offs. Disney also has the right to make sequels to the films made under the existing deal.

Pixar must have a new distributor in place before its eighth film is released in the summer of 2007. Now that the company is able to fund its own productions, and has an unprecedented string of hits to its name, it will not extend the same terms to any new partner. The likely outcome will be a flat distribution fee, probably linked to box office grosses.

Certainly, Pixar has been making it known that Disney is a handsome suitor, particularly since the media conglomerate announced that Michael Eisner would be replaced as chief executive by Bob Iger in September.

“We have always said that we were waiting for the changes at the helm of the [Disney] group before taking a decision,” said Ed Catmull, co-founder of Pixar, last month.

“Now that it’s done and that there will be a new CEO in September, we will resume negotiations with Walt Disney, but also with other market players,” he said.

Such conciliatory tones are striking in their contrast with Disney and Pixar’s comments over the past year. “We feel sick about Disney doing [Pixar] sequels,” said Steve Jobs, the Apple chief who also heads Pixar, at the height of animosities between the two. At the time, Mr Jobs said: “If you look at their sequels, like Lion King 1½ . . . it’s pretty embarrassing.”

But Mr Cook has emerged as Hollywood’s premier diplomat, having successfully negotiated the smooth exit of Bob and Harvey Weinstein from Miramax last month. It also helps that he is on excellent terms with Mr Jobs. “We’re good friends; I talk to him all the time,” he said.

There remain significant hurdles that could block a renewal of vows between Pixar and Disney. One is the desire among the Hollywood studios to cut a deal with Pixar. Another is Disney’s development of its own computer animation unit with a view to making sequels to Pixar hits. The latter, in particular, is said to rankle with Pixar. Production of Toy Story 3 is expected to begin next year. Disney is also said to be fielding pitches for sequels to Finding Nemo and Monsters, Inc.

But Mr Cook said that he was “hopeful that over the next several months we can have further discussions”.

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