Cartoons are big business in the San Fernando Valley.
Three of the top five studios are in the Valley area, and so are most of the animators, their union, the Disney studios and a number of smaller animation businesses.
Cartoons also are a changing business. The industry is growing increasingly competitive. Computers threaten to change the nature and economics of animation drastically. And the cartoons themselves have changed as well: They are tied more closely to merchandise than ever before.
The growing competition reflects how much money there is to be made. Combined, the three major television networks will spend an estimated $75 million on new episodes of Saturday morning cartoons this year. Local stations will spend another $120 million for new syndicated shows. Even more will be spent on licensing, full-length features and animation for commercials.
DIC Enterprises is evidence of that increased competition. A Studio City subsidiary of Radio-Television Luxembourg, the European entertainment conglomerate, DIC appears to have seized the top spot in the little-studied industry in less than three years of existence.
"A lot more people have gotten into the business," said Ken Spears, executive producer at Hollywood-based Ruby-Spears Enterprises, which has scored hits with "Alvin and the Chipmunks" and "Mr. T."
Walt Disney Productions in Burbank is among those moving into new areas. After ignoring the lucrative Saturday market for years, Disney now is producing two Saturday morning shows for airing by the networks this fall. Competitors say Disney, traditionally a bastion of animation-as-art, considered Saturday morning shows beneath its dignity because budget restraints require those cartoons to be made using a cheaper method called limited animation, in which there are far fewer drawings per second--and far less movement on the screen.
Then there is the challenge of technology. Computers already have infiltrated the cartoon business, where they now are used for coloration and other kinds of drudgery that make cartooning so time-consuming and expensive. But most in the industry say computers are not yet capable of animating people or animals.
'Can't Breathe Life'
"It can't breathe life into our characters," said Ed Hansen, Disney's vice president for animation.
Rapid advances in hardware and software are likely to change that, however, and some say that computers will revolutionize the industry.
Hanna-Barbera, perhaps the most famous animation company and the one where several industry leaders got their start, spent nearly $10 million to develop a state-of-the-art computer that saves time and cuts production costs. Other smaller companies use computer graphics to produce special effects and designs.
One company, Robert Abel Associates, even has produced a computer cartoon that simulates human movements, something traditional animators have long held to be beyond the capacity of a machine.
Abel thinks technology like his--Abel Associates writes its own cartooning software--will produce new opportunities for riskier cartooning of the sort that networks, local stations and the animation companies themselves are increasingly unwilling to create.
Ties to Merchandise
"With computer technology, you could probably make a modern version of "Fantasia" within the next two years," said Abel, whose company has won 21 Clio awards for its commercials.
"Fantasia," a Disney classic first released in 1940, took three years to make and cost $2.2 million, using the kind of animation that is prohibitively expensive for almost anyone else nowadays. By comparison, Disney's new film, "The Black Cauldron," opening in New York in July, took four years and $25 million to produce.
These days, cartoons are tied to merchandise--toys, dolls, and so forth. That helps cartoon producers maximize profits and helps the networks seize a greater market share since they are offering cartoon characters who already are known. It also gives them promotion they don't have to pay for: A child carrying a Smurf lunch-box is advertising Smurf dolls and cartoon characters simultaneously.
Indeed, cartoons now are often derived from merchandise. Cartoons have been made based on the Pac-Man video game, the Rubik's Cube, Go Bots toys and Smurf figures. Relatively few original cartoon characters find their way onto the air these days, and classics such as Rocky and Bullwinkle, the hallowed squirrel and moose whose Cold War antics are practically legend in the industry, might never get off the drawing board today.
'Risks Are Enormous'
"It's a far more competitive environment than it used to be," said Squire Rushnell, an ABC vice president who buys programs. "For a network to come in with a character no one has heard of, the risks are enormous."