Pixar

**Pixar Animation Studios**, trading as **Pixar,** was an American computer animation film studio based in Emeryville, California, that is a subsidiary of Walt Disney Studios, owned by The Walt Disney Company. Pixar began in 1979 as the Graphics Group, part of the Lucasfilm computer division, before its spin-out as a corporation in 1986, with funding by Apple Inc. co-founder Steve Jobs, who became the majority shareholder. Disney purchased Pixar in 2006 at a valuation of $7.4 billion by converting each share of Pixar stock to 2.3 shares of Disney stock, a transaction that resulted in Jobs becoming Disney's largest single shareholder at the time. Pixar is best known for CGI-animated feature films created with RenderMan, Pixar's own implementation of the industry-standard RenderMan image-rendering application programming interface, used to generate high-quality images.

Pixar has produced 20 feature films, beginning with *Toy Story* (1995), which was the first-ever computer-animated feature film; its most recent film was *Incredibles 2* (2018). All of the studio's films have debuted with CinemaScore ratings of at least an "A−," indicating positive receptions with audiences. The studio has also produced dozens of short films. As of August 2018, its feature films have earned approximately $13 billion at the worldwide box office, with an average worldwide gross of $659.7 million per film. *Finding Nemo* (2003), along with its sequel *Finding Dory* (2016), as well as *Toy Story 3* (2010) and *Incredibles 2* (2018) are among the 50 highest-grossing films of all time, with the latter being the second-highest-grossing animated film of all time with a gross of $1.2 billion. Fifteen of Pixar's films are also among the 50 highest-grossing animated films of all time.

The studio has earned 19 Academy Awards, 8 Golden Globe Awards, and 11 Grammy Awards, among many other awards and acknowledgments. Many of Pixar's films have been nominated for the Academy Award for Best Animated Feature since its inauguration in 2001, with nine winning; this includes *Finding Nemo* and *Toy Story 3*, along with *The Incredibles* (2004), *Ratatouille* (2007), *WALL-E* (2008), *Up* (2009), *Brave* (2012), *Inside Out* (2015), and *Coco* (2017). *Monsters, Inc.* (2001), *Cars* (2006), and *Incredibles 2* (2018) are the only three films that were nominated for the award without winning it, while *Cars 2* (2011), *Monsters University* (2013), *The Good Dinosaur* (2015), *Finding Dory* (2016), and *Cars 3* (2017) were not nominated. *Up* and *Toy Story 3* were also the respective second and third animated films to be nominated for the Academy Award for Best Picture, the first being Walt Disney Animation Studios' *Beauty and the Beast* (1991). Luxo Jr., a character from the studio's 1986 short film of the same name, is the studio's mascot.

On September 6, 2009, Pixar executives John Lasseter, Brad Bird, Pete Docter, Andrew Stanton, and Lee Unkrich were presented with the Golden Lion award for Lifetime Achievement by the Venice Film Festival. The award was given to Lucasfilm's founder George Lucas.

On January 6, 2020, as part of a reorganization of Walt Disney Studios, Pixar was merged with Fox Animation subsidiary Blue Sky Studios to form Blue Pixar Animation.

## History

### Early history

Pixar got its start in 1974 when New York Institute of Technology's (NYIT) founder Alexander Schure, who was also the owner of a traditional animation studio, established the Computer Graphics Lab (CGL), recruited computer scientists who shared his ambitions about creating the world's first computer-animated film. Edwin Catmull and Malcolm Blanchard were the first to be hired and were soon joined by Alvy Ray Smith and David DiFrancesco some months later, which were the four original members of the Computer Graphics Lab. Schure kept pouring money into the computer graphics lab, an estimated $15 million, giving the group everything they desired and driving NYIT into serious financial troubles. Eventually, the group realized they needed to work in a real film studio in order to reach their goal. Francis Ford Coppola then invited Smith to his house for a three-day media conference, where Coppola and George Lucas shared their visions for the future of digital moviemaking.

When Lucas approached them and offered them a job at his studio, six employees decided to move over to Lucasfilm. During the following months, they gradually resigned from CGL, found temporary jobs for about a year to avoid making Schure suspicious, before they joined The Graphics Group at Lucasfilm.

The Graphics Group, which was one-third of the Computer Division of Lucasfilm, was launched in 1979 with the hiring of Catmull from NYIT, where he was in charge of the Computer Graphics Lab. He was then reunited with Smith, who also made the journey from NYIT to Lucasfilm, and was made the director of The Graphics Group. At NYIT, the researchers pioneered many of the CG foundation techniques—in particular the invention of the alpha channel (by Catmull and Smith). Years later, the CGL produced a few frames of an experimental film called *The Works*. After moving to Lucasfilm, the team worked on creating the precursor to RenderMan, called REYES (for "renders everything you ever saw") and developed a number of critical technologies for CG—including "particle effects" and various animation tools.

In 1982, the team began working on special effects film sequences with Industrial Light & Magic. After years of research, and key milestones such as the Genesis Effect in *Star Trek II: The Wrath of Khan* and the Stained Glass Knight in *Young Sherlock Holmes*, the group, which then numbered 40 individuals, was spun out as a corporation in February 1986 by Catmull and Smith. Among the 38 remaining employees, there were also Malcolm Blanchard, David DiFrancesco, Ralph Guggenheim, and Bill Reeves, who had been part of the team since the days of NYIT. Tom Duff, also an NYIT member, would later join Pixar after its formation. With Lucas' 1983 divorce, which coincided with the sudden dropoff in revenues from *Star Wars* licenses following the release of *Return of the Jedi*, they knew he would most likely sell the whole Graphics Group. Worried that the employees would be lost to them if that happened, which would prevent the creation of the first computer animated movie, they concluded that the best way to keep the team together was to turn the group into an independent company. But Moore's Law also said that the first film was still some years away, and they needed to focus on a proper product while waiting for computers to become powerful enough. Eventually, they decided they should be a hardware company in the meantime, with their Pixar Image Computer as the core product, a system primarily sold to government agencies and the scientific and medical community.

In 1983, Nolan Bushnell founded a new computer-guided animation studio called Kadabrascope as a subsidiary of his Chuck E. Cheese's Pizza Time Theatres company (PTT), which was founded in 1977. Only one major project was made out of the new studio, an animated Christmas movie for NBC starring Chuck E. Cheese and other PTT mascots. The animation movement would be made using tweening instead of traditional cel animation. After the North American Video Game Crash of 1983, Bushnell started selling some subsidiaries of PTT to keep the business afloat. Sente Technologies (another division, was founded to have games distributed in PTT stores) was sold to Bally Games and Kadabrascope was sold to Lucasfilm. The Kadabrascope assets were combined with the Computer Division of Lucasfilm. Coincidentally, one of Steve Jobs' first jobs was under Bushnell in 1973 as a technician at his other company Atari, which Bushnell sold to Warner Communications in 1976 to focus on PTT. PTT would later go bankrupt in 1985 and be acquired by ShowBiz Pizza Place.

### Independent company

The newly independent Pixar (1986) was headed by Edwin Catmull as President and Alvy Ray Smith as Executive Vice President. While looking for investors, Steve Jobs showed interest, but initially, Lucas found his offer too low. Yet he eventually accepted after it turned out to be impossible to find other investors. At that point Smith and Catmull had been turned down 45 times; thirty-five venture capitalists and 10 large corporations had declined. Jobs, who had recently been fired from Apple, and was now founder and CEO of the new computer company NeXT, paid $5 million of his own money to George Lucas for technology rights and invested $5 million cash as capital into the company, joining the board of directors as chairman.

In 1985, while still at Lucasfilm, they had made a deal with the Japanese publisher Shogakukan to make a computer-animated movie called *Monkey*, based on the Monkey King. The project continued sometime after they became a separate company in 1986, but in the end, it became clear that the technology was simply not there yet. The computers were not powerful enough and the budget would be too high. So it was decided to focus on the computer hardware business some more years while waiting till Moore's law made a computer-animated feature possible.

At the time Walt Disney Studios was interested and eventually bought and used the Pixar Image Computer and custom software written by Pixar as part of their Computer Animation Production System (CAPS) project, to migrate the laborious ink and paint part of the 2D animation process to a more automated method.

In a bid to drive sales of the system and increase the company's capital, Jobs suggested to make the system available to mainstream users and released the product to the market. Pixar employee John Lasseter, who had long been working on not-for-profit short demonstration animations, such as *Luxo Jr.* (1986) to show off the device's capabilities, premiered his creations at SIGGRAPH, the computer graphics industry's largest convention, to great fanfare.

However, the Image Computer never sold well. Inadequate sales threatened to put the company out of business as financial losses grew. Jobs invested more and more money in exchange for an increased stake in the company, reducing the proportion of management and employee ownership until eventually, his total investment of $50 million gave him control of the entire company. In 1989, Lasseter's growing animation department, originally composed of just four people (Lasseter, Bill Reeves, Eben Ostby, and Sam Leffler), was turned into a division that produced computer-animated commercials for outside companies.

During this period Pixar continued its successful relationship with Walt Disney Animation Studios, a studio whose corporate parent would ultimately become its most important partner. As 1991 began, however, the layoff of 30 employees in the company's computer hardware department—including the company's president, Chuck Kolstad, reduced the total number of employees to just 42, essentially its original number. Yet Pixar made a historic $26 million deal with Disney to produce three computer-animated feature films, the first of which was *Toy Story*. By then the software programmers, who were doing RenderMan and IceMan, and Lasseter's animation department, which made television commercials (and four Luxo Jr. shorts for *Sesame Street* the same year), were all that remained of Pixar.

Despite the total income from these projects the company continued to lose money and Jobs, as chairman of the board and now the full owner, often considered selling it. Even as late as 1994 Jobs contemplated selling Pixar to other companies such as Hallmark Cards, Microsoft co-founder Paul Allen, and Oracle CEO and co-founder Larry Ellison. Only after learning from New York critics that *Toy Story* would probably be a hit—and confirming that Disney would distribute it for the 1995 Christmas season—did he decide to give Pixar another chance. For the first time, he also took an active leadership role in the company and made himself CEO. *Toy Story* went on to gross more than $373 million worldwide and, when Pixar held its initial public offering on November 29, 1995, it exceeded Netscape's as the biggest IPO of the year. In only its first half-hour of trading Pixar stock shot from $22 to $45, delaying trading because of un-matched buy orders. Shares climbed to $49 before closing the day at $39.

During the 1990s and 2000s, Pixar gradually developed the "Pixar Braintrust," the studio's primary creative development process, in which all directors, writers, and lead storyboard artists at the studio look at each other's projects on a regular basis and give each other very candid "notes" (the industry term for constructive criticism). The Braintrust operates under a philosophy of a "filmmaker-driven studio," in which creatives help each other move their films forward through a process somewhat like peer review, as opposed to the traditional Hollywood approach of an "executive-driven studio" in which directors are micromanaged through "mandatory notes" from development executives ranking above the producers. According to Catmull, it evolved out of the working relationship between Lasseter, Stanton, Docter, Unkrich, and Joe Ranft on *Toy Story*.

As a result of the success of *Toy Story*, Pixar built a new studio at the Emeryville campus which was designed by PWP Landscape Architecture and opened in November 2000.

### Collaboration with Disney

Pixar and Disney had disagreements over the production of *Toy Story 2*. Originally intended as a straight-to-video release (and thus not part of Pixar's three-picture deal), the film was eventually upgraded to a theatrical release during production. Pixar demanded that the film then be counted toward the three-picture agreement, but Disney refused. Though profitable for both, Pixar later complained that the arrangement was not equitable. Pixar was responsible for creation and production, while Disney handled marketing and distribution. Profits and production costs were split 50-50, but Disney exclusively owned all story, character and sequel rights and also collected a 10- to 15-percent distribution fee. The lack of story, character and sequel rights was perhaps the most onerous aspect to Pixar and set the stage for a contentious relationship.

The two companies attempted to reach a new agreement for ten months before it fell through in January 2004. The new deal would be only for distribution, as Pixar intended to control production and own the resulting story, character and sequel rights themselves while Disney would own the right of first refusal to distribute any sequels. Pixar also wanted to finance their films on their own and collect 100 percent of the profits, paying Disney only the 10- to 15-percent distribution fee. More importantly, as part of any distribution agreement with Disney, Pixar demanded control over films already in production under their old agreement, including *The Incredibles* (2004) and *Cars* (2006). Disney considered these conditions unacceptable, but Pixar would not concede.

Disagreements between Steve Jobs and then-Disney chairman and CEO Michael Eisner made the negotiations more difficult than they otherwise might have been. They broke down completely in mid-2004, with Disney forming Circle 7 Animation and Jobs declaring that Pixar was actively seeking partners other than Disney. Despite this announcement, Pixar did not enter negotiations with other distributors, although a Warner Bros. spokesperson told CNN, "We would love to be in business with Pixar. They are a great company." After a lengthy hiatus, negotiations between the two companies resumed following the departure of Eisner from Disney in September 2005. In preparation for potential fallout between Pixar and Disney, Jobs announced in late 2004 that Pixar would no longer release movies at the Disney-dictated November time frame, but during the more lucrative early summer months. This would also allow Pixar to release DVDs for their major releases during the Christmas shopping season. An added benefit of delaying *Cars* from November 4, 2005, to June 9, 2006, was to extend the time frame remaining on the Pixar-Disney contract, to see how things would play out between the two companies.

Pending the Disney acquisition of Pixar, the two companies created a distribution deal for the intended 2007 release of *Ratatouille*, if the acquisition fell through, to ensure that this one film would still be released through Disney's distribution channels. In contrast to the earlier Pixar deal, *Ratatouille* was to remain a Pixar property and Disney would have received only a distribution fee. The completion of Disney's Pixar acquisition, however, nullified this distribution arrangement.

## External links

* pixar.com

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