The Computer Research and Development Division at Lucasfilm was set up to create new technologies. Digital imaging, electronic editing, and interactivity all required the technologies being created under the new division. Under the leadership of Alvy Ray Smith and Ed Catmull the technologies quickly emerged. This group of talented individuals which also included Ralph Guggenheim developed new technologies in four divisions: computer graphics, digital audio, computer editing, and video games.
As the technologies formed and the division grew, computer graphics captured the attention of others besides George Lucas.
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Companies such as EDS and General Motors gained interest. Steve Jobs, co-founder and CEO of Apple Inc., became increasingly interested in the process of the Lucasfilm, Ltd. Computer division. A few signatures and 10 million dollars later Steve Jobs obtained ownership of the computer graphics division at Lucasfilm, Ltd. The division then became an independent company which became known as “Pixar”. (www.Pixar.com, 1986)
After working for Lucas since 1979 at Lucasfilm as vice-president of the division, Ed Catmull became co-founder and chief technical officer of Pixar (www.Pixar.com, 1986). Forty-four other individuals were also employed under the company at the time. The small staff of Pixar worked hard to expand the reaches of the company. Using computer graphics and animation technologies advanced by the staff itself, Pixar premiered an animation short, Luxo Jr., which was created by John Lassater at Siggraph in 1986. Shortly thereafter, Luxo Jr. was nominated for an Academy Award® for Best Animated Short Film. The film received the Golden Gate Award: first prize, Computer-Generated Imagery at the San Francisco International Film Festival earning the company its first award (www.pixar.com, 1987).
As Pixar created more and more animated shorts, a new technology emerged to improve the appearance of the films on screen. Pixar obtained a patent for their newest tool to overcome the challenges of rendering 3D animation and visual effects. The team who developed the technology consisted of Ed Catmull, Rob Cook, Thomas Porter, Loren Carpenter, Pan Hanrahan, Tony Apodaca, and Darwym Peachy. Their program became known as RenderMan, and it is able to manage an enormous amount of geometric complexity. The program also provides cutting-edge effects such as motion blur, realistic shading, the appearance of fur and hair, displacements, and many other new effects. With the use of RenderMan, Pixar raised the expectations in animation.
Along with the production of animated shorts, the company produced commercials for many companies. Tropicana earned the honor of having Pixar’s first commercial created for them. Over the next few years, Pixar continued to create commercials for numerous companies. Trident, California Lottery, Volkswagen, Listerine, and Pilsbury were among the first who premiered commercials produced by Pixar. For six years, the company created specially-commissioned commercials and spread their name across the nation and other parts of the world. By 1990, the company expanded from forty-four employees to 100 employees (www.fundinguniverse.com, Pixar Animations Studios company history).
In 1991, Walt Disney Studios and Pixar pair together (www.pixar.com, 1991). The new duo develops, produces, and distributes three feature-length films. Pixar and Disney signed a contract to produce quality ‘digital-entertainment’. Walt Disney Studios would provide the funding needed for the production and promotional costs. Disney would also own marketing and licensing fees of the characters and films. Pixar was solely responsible for the content and animation of the three full-length films. Together the alliance created Toy Story, the first full-length computer-animated film. The film was nominated for several awards including three Oscars and two Golden Globes.
As the award nominations kept growing, the money continued to flow into the company. Disney received the most profit from the movie, but Pixar managed to negotiate with its partner to receive a part of the gross revenues from the box office and video sales. Pixar made a profit from RenderMan and continued to receive awards for the program. By 1995, Pixar sold over 100,000 copies and signed a huge licensing deal with Bill Gates and Microsoft. The company announced it’s first-ever profit of $3.1 million on revenues of $10.6 million. Prior to Thanksgiving, Toy Story went public and the company’s success grew. The company grossed $40 million in its first weekend premiere. The movie became the highest grossing film in 1995 and received $362 million worldwide in domestic box office receipts. The following year, Toy Story was released on video to the public, and Pixar was already immersed in the next Disney movie, Bug’s Life. (www.fundinguniverse.com, Pixar company history)
Although Bob Bennet of Autodesk competed with Pixar, he said, “Pixar is the best in the world at what it does.” Their advances in computer and graphics technology created greater competition. The release of Toy Story inspired Dreamworks SKG, Turner Broadcasting, Warner Bros., and Disney to creat major motion pictures with the use of computer animation. Pixar’s A Bug’s Life was up against four other animated pictures, but the company once again prevailed and received $360 million in box office receipts which topped Toy Story. Animated shorts such as Geri’s Game were still being constructed at the time of film production. Pixar once again was nominated for and won won Academy Awards. (www.fundinguniverse.com, Pixar company history)
In 1997, two major events helping to boost the spirits of all those employed at Pixar. A large financial enhancement presented itself to the company as revenues reached $34.7 million and a net income extended to $22.1 million. The triumphs of both A Bug’s Life and Toy Story brought a new deal with Disney. The companies would work as equal partners and produce five additional films within the following ten years. The two pictures remaining from the old deal would become a part of the five new pictures in the new deal. On top of that, Pixar would sell up to five percent of its common stock at $15 per share to Disney. (www.fundinguniverse.com, Pixar company history)
During the last year of the century, Pixar celebrated the achievements of their rapidly growing company. Their most recent success, A Bug’s Life, was released on video and DVD simultaneously, and employees worked hard on the production of a sequel to Toy Story which was planned to be released in November of the next year. At the time, most sequels or prequels were directly released on video; only one video, Disney’s The Rescuers Down Under had broken the trend. Determined, Pixar worked to release the sequel to theaters not straight to video.
Ending the year with $14.3 million in the revenue and $7.8 in net earnings, Pixar entered 1999 with eyes for success. Thanks to the technological achievements of David DiFrancesco, Pixar won its ninth academy award. Later that year, Toy Story 2 earned box office supremacy with its opening in November. The film received high receipts than the first weeks of release for Star Wars: Phantom Menace the year before. The victory over Lucasfilm Ltd., the origin of the Pixar company, provided Pixar with dominance in the box office. Pixar ended its fifth consecutive profitable year with revenues of $121 million and earnings that topped $50 million. (www.fundinguniverse.com, Pixar company history)
Before entering the new century, Pixar reflected back on its achievements over the past 16 years. Five shorts emerged from the company over the years. Each short and all of the new technologies that came out of Pixar earned them many awards. Thirty-two awards including nine Academy Awards were given to the company in honor of their great works. In six years, seventy-one specially-commissioned commercials were produced for numerous amounts of business. Technologies such as CAPS and RenderMan, both created by Pixar, benefited the company by helping to produce better quality animated works. The company’s reach expanded over the country and even to different parts of the world. (www.pixar.com, 1984-1999)
Using the profits of their success, the company purchased an establishment in Emeryville, California. Their new headquarters is 225,000 square-feet and was dues to be completed in the middle of 2000. In the midst of preparing to move locations, Pixar worked with Disney on their next full-length animated picture. The film was scheduled to be released in 2001, and Monsters, Inc. was the title chosen to become the name of the film. Monsters, Inc. became the 3rd highest grossing animated film in history until that point, and it was the highest grossing animated film worldwide in 2001 (www.pixar.com, 2001).
As the company grew to over 600 employees, founding members of the company received further advances of their own. Ed Catmull, co-founder, is named president of the company after serving as chief technical officer since the company was incorporated. John Lassater, Pixar’s executive vice president, signed a ten-year contract to commit his services solely to the studio. (www.pixar.com, 2001)
After the premiere of Disney and Pixar’s Monsters, Inc, the ideas for movies continued to flow through the mind Pixar. Pixar releases Finding Nemo the following year, and the film sells more than eight million units in the first day making it a historical success (www.pixar.com, 2003). The next consecutive year The Incredibles is released to the public. John Lassater returns to his throne as director to create the newest movie Cars.
Coinciding with the release of Cars, Pixar Animation Studios transfers ownership from the hands of Steve Job to Walt Disney Company. Job sells Pixar in an all-stocks transaction worth $7.4 billion (www.pixar.com, 2006). Under the new ownership of Disney, Pixar produces an eighth movie, Ratatouille which is released on June 29, 2007 (www.pixar.com, 2007). Over the next two years, Wall E and Up are both released from Disney and Pixar studios. Pixar gained competition among Dreamworks SKG, Warner Bros., Fox Entertainment, and even its reason of origin, Lucasfilm, Ltd.
Despite many grievances the company faced, Pixar triumphed and grew from a simple division used to experiment with new technologies into a thriving business. Pixar Animation Studios became a pioneer in computer animation. Using its technological advances, supremely crafted animated films, and willpower to succeed, the company flourished. Pixar established an empire known throughout the world in almost every family household. The company came a long way over the past twenty years and not once did they quit.
