By Crikey reporter Sophie Vorrath


It’s official. Walt Disney has announced it’s buying Pixar, the animation studio led by Apple head Steve Jobs, in a deal
worth a wee $US7.4 billion – that’s $US6.3 billion in stock plus $US1.1 billion of the computer animation specialist’s
cash, the companies said after the market closed yesterday. “Disney and
Pixar can now collaborate without the barriers that come from two different
companies with two different sets of shareholders,” said
Jobs. “Now,
everyone can focus on what is most important, creating innovative
stories,
characters and films that delight millions of people around the world.”
But already, the news has sparked a flurry of speculation, saysThe Los Angeles Times:
“What role would Jobs play in the Magic
Kingdom? How would the purchase
change Disney’s internet strategy? And would Dopey and the other dwarfs get
their own iPod?”

It’s not hard to see why Disney wants to buy Pixar, says
Mark Tran in The Guardian. The Magic Kingdom
once churned out cartoon films from Pinocchio to the Lion King that enchanted
droves of film-goers. But with the advent of computer generated films, Disney
has floundered. For the venerable animation giant, the move is a significant
bet on Pixar’s digital approach as the successor to the pen-and-ink industry
popularised by Walt Disney, say Ina Fried and John Borland on CNet.
The purchase is also the latest indication of a tectonic collision between
technology and Hollywood.

As for Steve Jobs, the master of disruption is at
it again, says Fred Vogelstein in Fortune
(via CNN Money).
With his two
remarkable companies – Apple Computer and Pixar – dominating the
headlines, he
finds himself in the kind of position that most mad-genius tech
wunderkinds can
only fantasise about: thrilling consumers while wreaking havoc in
multiple industries. Word of the link-up that will make him Disney’s
largest individual shareholder – and land him on the media behemoth’s
leadership team – had jaws
dropping from Wall Street to Hollywood
to Silicon Valley. His head start on digital animation combined with
his burgeoning iEmpire places
him squarely in the intersection of Hollywood
and high tech – the one figure in position to control the fast-moving
evolution of media consumption.

But Jobs should be wary of Disney’s embrace, says Tran. Its track record on acquisitions is hardly impressive, while Pixar has
flourished perfectly well on its own – growing to hundreds of employees from
about 44 in 1986, two years after Jobs acquired the company from director
George Lucas for $US10 million. The six films Pixar made in arrangement with
Disney since the 1995 release of Toy Story have grossed more than $US3.2bn. Once
Pixar becomes part of the Disney behemoth, however, question
marks will arise over whether the animation firm will be able to maintain its creative
edge; and over whether Jobs is spreading himself too thin. Jobs will be in
an awkward position if or when the Disney board discusses technology deals with
other companies – especially if Disney wants to distribute content on other
platforms besides iTunes. This is not a match made in heaven, no matter how
Disney spins it.

Peter Fray

72 hours only. 50% off a year of Crikey and The Atlantic.

Our two-for-one offer with The Atlantic was so popular we decided to bring it back.

But only for 72 hours.

Use the promo code ATLANTIC2020 and you’ll get 50% off a year of Crikey (usually $199) and a year of digital access to The Atlantic (usually $70). That’s BOTH for just $129.

Hurry. Ends midnight this Thursday.

Peter Fray
Editor-in-chief of Crikey

Claim Now