New take on visiting Santa in the Works

DIVERSIFYING OFFERINGS: DreamWorks Animation has been moving away from films as computer animation is no longer a sure thing. It now offers a huge array of products tied to How To Train Your Dragon 2.


    Jun 19, 2014

    New take on visiting Santa in the Works


    FOR months, DreamWorks Animation has been working on a prototype for a product it hopes will change how the world's children meet Santa each Christmas. Code name: DreamHouse.

    At shopping malls that buy in - and two national operators already have, Forest City and General Growth Properties - Santa Claus will sit inside a "cottage" with walls that are essentially giant video screens.

    Children will go on a virtual sleigh ride with Shrek before meeting Santa. No more waiting in line; appointments will be made via app.

    "It's an amazing, beautiful, big theatrical statement that represents our efforts to diversify into new areas," said Jeffrey Katzenberg, DreamWorks Animation's chief executive.

    Diversification has been Mr Katzenberg's mantra for at least two years, ever since an effort to sell his small studio ended without success.

    DreamWorks Animation, one of moviedom's last studios not tied to a conglomerate, has none of the buffers of, say, Walt Disney, which can lean on consumer products, TV or theme parks if an expensive movie flops.

    Computer animation is no longer a sure thing. The company has had to take write-downs on three of its last four original films.

    Hence the importance of projects like DreamHouse, which Mr Katzenberg also intends to introduce overseas.

    "The goal is to create annuities so we don't have lumpy earnings," said Michael Francis, DreamWorks Animation's chief brand officer.

    So far, the studio's most prominent diversification efforts have involved television and the Internet.

    The company has contracts to produce a jaw-dropping 1,100 episodes of original cartoon programming for Netflix.

    Last year, the studio acquired AwesomenessTV, a thriving collection of YouTube channels focused on teenagers. On Monday, it introduced DreamWorksTV, a family-oriented YouTube channel.

    Last year, 71 per cent of DreamWorks Animation's revenue came from new films, according to Anthony Wible, an analyst at Janney Montgomery Scott. Next year, he expects it to be closer to 48 per cent.

    The studio has quietly built a hefty merchandising division.

    Eighteen months ago, the studio had 69 consumer products executives. Now there are roughly 180, and hiring continues.

    Mr Francis' various efforts began to enter the marketplace this month with the release of a tablet computer for children, the DreamTab, and a huge array of products tied to How To Train Your Dragon 2.

    (The first movie had one retail partner; the sequel has 70.)

    But DreamWorks Animation's brand will become significantly more noticeable later this year, when a new in-house publishing unit begins to release books, and experience-based products like the DreamHouse begin to roll out.

    Coming next year to London and then five additional cities is a permanent walk-through attraction called "Shrek's Far, Far Away Adventure".

    Other plans include licensing characters for an amusement park as part of the New Jersey Meadowlands megamall and a trio of indoor theme parks in Russia. There is also a shopping and entertainment complex in Shanghai called the DreamCenter.