
Originally Posted by
Steven Mallas of Motley Fool Now, Katzenberg also said something with regard to the competition: "It takes a huge amount of capital and a tremendous amount of time and resources to create these films. The ability of companies to put all of those elements together are fairly few and far between."
I don't know if I agree with him on this count. I suppose there could be several interpretations to the exact meaning of his comments, but I take it to mean that he thinks DreamWorks Animation and its main competitor Pixar (Nasdaq: PIXR - News) -- which he singled out -- are pretty much the only real players in the computer animation field. That doesn't ring too accurate to me. That seems to ignore the success of a film such as News Corp's (NYSE: NWS - News) Robots, for instance. The article says that the context of his thoughts related to "budget-oriented players" trying to settle in on the Shrek turf, but the way I see it, conglomerates such as Time Warner (NYSE: TWX - News) and Disney (NYSE: DIS - News) always have the resources to mount assaults on either Katzenberg's or Steve Jobs' arena of success. Besides, a huge budget does not necessarily guarantee success; in theory, at least, as the timeline progresses, technology does become cheaper. When cheaper technology is married with a good idea (The Blair Witch Project), the results can be substantially valuable.
I do understand that keeping ahead of the sophistication level possessed by audiences does require a lot of capital, but if I were Katzenberg, I would assume that there's always going to be a "next guy" with a "bigger idea." In other words, hubris need not apply. He should never stop worrying that DreamWorks Animation's leadership is about to be usurped. I'm confident that his shareholders don't want a complacent CEO trying to maximize the return on their collective equity.
Bookmarks