Dreamworks Animation

News that DreamWorks Animation is cutting short its output deal with HBO in order to work with Netflix sent the "Shrek" producer's stock to its highest point in more than a month. DreamWorks Animation's current agreement with pay-TV channel HBO was to run until 2014. Under the terms of the deal, DreamWorks Animation movies go exclusively to HBO during the "pay cable window," which typically starts about six months after theatrical debut. However, DreamWorks Animation has gone to HBO and obtained an exit from the contract so it can instead make its movies available on Netflix's Internet streaming service during that window, a person familiar with the matter confirmed.

Paramount Pictures is launching its own animation division, spelling a likely end next year to its longtime agreement to distribute movies for DreamWorks Animation. The relationship between the two companies has been strained recently over how much DreamWorks pays the Viacom Inc.-owned studio to release its films, according to people with knowledge of the matter. One person familiar with the thinking of top executives at Paramount said the studio offered DWA Chief Executive Jeffrey Katzenberg a one-year extension to his company's deal, which expires in 2012, for the same fee DreamWorks now pays Paramount: 8% of film revenues.

The City Council on Tuesday extended its development agreement with DreamWorks Animation for five years. The original 15-year development agreement would have ended in the coming weeks. Phil Lanzafame, the city’s chief assistant director for community development, said the studio has developed roughly 460,000 square feet of space and still has rights under the original deal to develop another 35,000 square feet. Jeffrey Haber, an attorney for DreamWorks, said the company wants to preserve the right to develop further, though it has no specific plans to do so. Lanzafame told the City Council that if the studio ever sought to develop more than the remaining 35,000 square feet, it would require a new agreement and likely a full environmental review.

DreamWorks Animation is counting on a panda bear to lift financial results for the Glendale-based studio in 2011, with a new “Kung Fu Panda” film and TV show debuting later this year. Chief Executive Jeffrey Katzenberg told entertainment industry analysts in a conference call on Tuesday that animated family films are about the only bright spot for the movie industry today, and that DreamWorks is in a good position to capture worldwide audiences in the coming years with sequels to “Panda” and “How to Train Your Dragon.” “Animated movies have been the most successful thing going on in the marketplace, but it has been a lousy marketplace,” Katzenberg said.

Glendale’s San Fernando Road corridor, long a drab bastion of nondescript warehouses and vague storefronts, continued its transformation this week with yet another huge commitment from the Walt Disney Co. and another firm poached from Los Angeles. Kinetic Lighting Inc. — which sells and rents lighting equipment and produces special events — announced it would move from North Hollywood to a facility in the steadily forming San Fernando Creative Corridor. Technicolor Inc. also agreed earlier this month to move 100 film-processing jobs into a 40,000-square-foot Flower Avenue warehouse, citing its proximity to DreamWorks Animation and the Disney’s Creative Campus.

Glendale-based DreamWorks Animation on Thursday reported strong fourth-quarter earnings, despite what Chief Executive Jeffrey Katzenberg admitted was an “up-and-down” performance for the studio. DreamWorks revenues rose to $275.7 million, compared with $194 million in the same period a year earlier. Profits for the quarter came in at $85.2 million, nearly double the $43.6 million in the same quarter in 2009. The strong performance was led by home video sales for “How to Train Your Dragon,” which was also in theatrical release.

Glendale officials are seeing a full-color demonstration of what they hope will happen in the San Fernando Road Creative Corridor, with Technicolor Inc. agreeing this month to move 100 film-processing jobs into a 40,000-square-foot Flower Avenue warehouse. The move is expected to be complete in July, after the firm downsizes and shutters a North Hollywood facility in June, said Joe Berchtold, president of Technicolor’s creative services division. Technicolor also has facilities in Burbank, as well as other Southern California cities.

BURBANK — Armed with a folder packed with sketches, 20-year-old Matthew Lewis was eager Saturday to get honest critiques of his drawings from industry experts at this year's animation expo. For Lewis, his folder of cartoon sketches represents his longtime passion in pursuing a career in character design and concept art. "A lot of it is super, super competitive, and there is the warning that you have to get your [stuff] together now and every time you have your foot in the door, jam it in there and pry that door open as best you can," he said.

The Burbank and Glendale movie studios famous around the world know charity begins at home. The Walt Disney Co., Warner Bros. Studios and DreamWorks Animation each donate hundreds of thousands of dollars in cash, gear and volunteer time to a host of organizations annually. And they use the preferences of their local employees, as well as a commitment to children and the arts, as their guides. The often secretive studios also work together on the charitable side. For example, all have donated money and expect to provide volunteer workers when a Habitat for Humanity project breaks ground in Burbank next year.

DreamWorks Animation is seeing the future in 3-D. In announcing its quarterly earnings Tuesday afternoon, the Glendale-based company's chief executive made it clear that movies produced for 3-D, such as DreamWorks' successful "Shrek Forever After," will be a focus going forward. "We're seeing a fresh, vibrant new marketplace," said Jeffrey Katzenberg at a Tuesday afternoon conference with investors. Showings of "Shrek Forever After" in 3-D led the company in reporting total revenue of $158 million and net income of $24 million for the quarter.