Eisner disagreed. Ever since director James L. Brooks had grudgingly conceded that budgets and tight schedules had made Terms of Endearment a better picture, Eisner was convinced that such pressures and the resulting discipline improved quality. It fell to Schneider to mediate between Eisner and Katzenberg on the one hand, and Roy and the animators on the other. He tried to steer a middle ground. “If cheaper means not squandering money, we are making strides to improve the efficiency and better manage the process,” he wrote Eisner in a December 1989 memo. “If cheaper means smaller budgets for our movies, then this is in conflict with ‘bigger, better.’ With Jeffrey and Roy’s desire to make truly top production value movies, it will cost more money. In my opinion, the reason that Disney animated movies were and can again be great is the ability to throw out and redo and make it better. The money spent during the making of ‘Mermaid’ made a good movie into a great movie.”
So budgets rose, but so did production. Employment in the animation division soared. To keep all the animators busy, Roy proposed reviving a long-cherished dream: the making of a new Fantasia, a sequel of sorts to Walt’s 1940 classic. Walt had always envisioned Fantasia, a collection of animated segments set to classical music, as a work-in-progress, something that could be constantly updated and refreshed. Though Eisner explored the idea in a meeting with composer-conductor Leonard Bernstein, he’d been cool to the idea. Katzenberg hated it. Still, Roy persisted.
Then Eisner hit on a compromise. Roy was still resisting the release on video of both the original Fantasia and Snow White. So Eisner proposed using the proceeds from the sale of Fantasia videos to finance a Fantasia sequel under Roy’s direction. After a meeting with Eisner and family members, Roy agreed. Fantasia sold 15 million copies, and Eisner called Lillian, Walt’s widow, to tell her that Fantasia had finally earned a profit.
But Katzenberg remained hostile to a new Fantasia, which became an ongoing source of unspoken friction between him and Roy. As work began on the project, Katzenberg showed no interest in it. Roy and the animators held meetings and reviewed storyboards without him, something that would have been unthinkable on any other feature animation project. Instead, Roy dealt directly with Eisner.
Katzenberg was in any event too busy with his own projects to worry about Roy’s. In keeping with the faster pace, he rushed to sign Ashman and Menken to another project even before Mermaid was released. The pair turned to a musical retelling of “Aladdin and the Magic Lamp,” the tale from the Arabian Nights. Ashman had already mapped out the script, and he and Menken had completed several songs, but Eisner didn’t feel confident about the mass appeal of a story set in the Middle East. So Katzenberg had them drop work on Aladdin and persuaded them to move to another classic fairy tale, “Beauty and the Beast.”
Beauty and the Beast had been in development for over a year as a traditional Disney animated fairy tale, and a team of British animators had been hired to give it a fresh look. But now Ashman made it his next candidate for the Broadway musical treatment. Clements and Musker were brought in as producers, and the British team was dismissed. Ashman and Menken went to work on a new score and lyrics, and the musical elements were woven seamlessly into the plot, just as Rodgers and Hammerstein had used music, lyrics, and dance to advance the plots of their Broadway musicals. This time Ashman got his way with a Broadway-style extended musical opening. “Belle,” the opening number, was a musical montage that occupied a full seven minutes of screen time, an unheard-of length in an animated feature.
Most of the creative work on Beauty was done in New York to accommodate Ashman. Soon after the opening of Little Mermaid, he told his partner, Bill Lauch, an architect, that he was meeting in New York with Katzenberg, and “I’ve got to tell him, and I’ve got to tell him today.” Only Lauch and Ashman’s family knew that he had AIDS, which had been diagnosed more than a year before. Ashman had been very nervous about Disney’s reaction, given the stigma of the disease, but the success of Little Mermaid gave him the strength.
Ashman told Lauch that Katzenberg had been great, taking the news in stride. “Okay,” Katzenberg had said. “What do you need? We’ll do it.” Schneider and Eisner were equally supportive. They were surprised, but realized they shouldn’t have been, given Ashman’s increasing absences in California. At considerable expense, Disney moved the entire Beauty and the Beast team to the Residence Inn, an extended-stay hotel in Fishkill, New York, a Hudson River town not far from Ashman’s house. Screenings were held at the hotel. Ashman continued to review storyboards and to sing new lyrics to Menken’s songs in an increasingly weak but determined voice. He and Menken listened to a recording of Stephen Sondheim’s A Little Night Music, finding inspiration in Sondheim’s sophisticated, bittersweet comedy of manners.
Like so many of the classic fairy tales, the original “Beauty and the Beast” has dark overtones and an unhappy ending. As with Mermaid, Ashman proposed changes that transformed the story into something that was both more emotionally satisfying and in line with the Disney formula. He shifted the story’s point of view from the pretty but somewhat bland ingenue Belle to the more complex Beast, a kind spirit trapped in a repulsive body, which let the audience share the Beast’s deep longing for love and a normal life. The Beast’s rival for Belle’s affection was changed from the foppish Gaston into a muscular, square-jawed, even sexy suitor whose handsome surface and grossly sexist prejudices made him the psychological opposite of the Beast. From an animation standpoint, Ashman had the strikingly original idea to turn the inanimate objects of the Beast’s kitchen and dining room into characters, and then unleash them in a dazzling Broadway-style production number, “Be Our Guest.” Still, Ashman didn’t always get his way. Katzenberg cut one of his favorite songs, “Human Again,” saying it was redundant.
While the CAPS computer system was still in its infancy in Little Mermaid, its potential was fully realized in Beauty. The system made possible much more lavish and realistic background images. At one meeting, Katzenberg criticized the ceiling in the Beast’s castle. “Fix the ceiling,” he insisted. “Make it French, like Botticelli.” While the Botticelli gaffe was widely repeated among the animators, the ceiling was redrawn in dazzling detail.
The renaissance of animation was confirmed in March 1990, when Little Mermaid won two Academy Awards, including Best Song for “Under the Sea.” Ashman and Menken accepted the award. “At home, there’s my mom, there’s my sister, there’s Nancy and Bill. I feel really lucky,” Ashman said. Only after the ceremony did Ashman finally tell Menken that he had AIDS.
Even more remarkable than the awards and critical acclaim was the film’s effect on the bottom line—not just box-office revenues but sales of home videocassettes, which amounted to 9 million units and $180 million, not to mention Ariel dolls and other merchandise.
That summer, Katzenberg, Roy, and Schneider were flying from London to Paris to help promote the European opening of Little Mermaid. The group was ruminating about coming-of-age stories, and that watershed moment—the birth of a child, perhaps—when the child becomes a man. Katzenberg started telling the story of such a moment in his life. “I’d like to tell that story, set in Africa,” he said, the inspiration having just come to him. Katzenberg had been fascinated by Africa ever since he worked on a movie set in Kenya when he was twenty-one. “The animal kingdom is a metaphor,” he continued. “A child loses a parent, goes out into the world, tries to avoid responsibility, then faces it….” Katzenberg looked at his audience. “Uh-huh,” Schneider said noncommittally. “I like the idea of animals,” Katzenberg continued. Little Mermaid, Beauty and the Beast, Aladdin all had humans as the main characters.
Not only was this his idea, but the coming-of-age aspect resonated deeply with Katzenberg. At one of the script meetings, he told a story of his own loss of innocence, while working in the 1972 presidential campaign of John Lindsay. As an advance man, he took hundreds of thousands in unrecorded cash campaign contributions, including a cash-filled envelope from
a man who subsequently profited enormously from dealings with the city. Cash contributions weren’t illegal at the time, but bribery was, and Katzenberg ended up being subpoenaed by a grand jury investigating Lindsay and the businessman. Though no charges resulted, it was a searing education in money and politics for Katzenberg, and as he told the story he choked up and couldn’t continue, a rare display of emotion.
The very originality of Katzenberg’s idea was as much a risk as a possible virtue. All of the great Disney classics starting with Snow White had been adaptations of tried-and-true classics. When they returned to Los Angeles, Schneider put the idea into development, but with a distinctly second-tier group of directors and animators, since the division’s stars—Musker and Clements, animator Glen Keane—were already occupied with Beauty and the Beast and Aladdin. To help oversee the project, Schneider drafted Thomas Schumacher, a producer for The Rescuers Down Under, an artistic success but one of Disney’s rare commercial failures when it was released in November 1990. A script slowly began to evolve under the working title King of the Jungle.
The enormous success and creative explosion in animation began to overshadow the live-action studio, but there, too, the Disney profit juggernaut continued to roll on, with Cocktail starring Tom Cruise in 1988 and Honey, I Shrunk the Kids and Dead Poets Society opening the same year as Mermaid. In Dead Poets Society, the prep school English teacher played by Robin Williams was loosely based on Eisner’s favorite professor at Denison, and the film won the Academy Award for best original screenplay. Eisner credited marketing head Dick Cook for the idea to open Dead Poets, a relatively serious film with appeal to adults as well as teenagers, into a summer schedule crowded with special effects adventures and light comedies. Dead Poets alone brought in $236 million worldwide.
In the wake of such unprecedented success, Eisner and Katzenberg embarked on the same strategy as in animation: sharply boost production. In order to accommodate both of Katzenberg’s top production executives, David Hoberman and Ricardo Mestres, Disney launched a sister studio to Touchstone, Hollywood Pictures, the name taken from Eisner’s earlier plan to reinvent American International Pictures, had he taken over that studio. Walt Disney Pictures, the vehicle for live-action family fare, was placed under Hollywood, reporting to Mestres. Katzenberg had persuaded Eisner, over Wells’s strenuous objections, that another studio would enable Disney to capitalize on the explosive growth in multiplex theaters, which meant far more demand for new films and potentially wide distribution. Wells argued that other studios had tried the same strategy and failed, but other studios didn’t have Disney’s track record. Katzenberg’s 1987 warning that a flop was inevitable now seemed just a fleeting moment of self-doubt that had been proven wrong. In the notoriously fickle business of moviemaking, twenty-seven of Disney’s first thirty-three films under the Eisner/Wells/Katzenberg regime had been profitable, including nineteen in a row. Disney seemed to have discovered a foolproof formula for hit movies, something that had eluded even the greatest of filmmakers.
The only studio that wasn’t sharing in Disney’s amazing box-office success was Walt Disney Productions, the old family-oriented live-action studio that had made Mary Poppins and 20,000 Leagues Under the Sea. In addition to putting Walt Disney Pictures under the new Hollywood label, Katzenberg also hired David Vogel, a young executive who’d worked with Steven Spielberg on Amblin’s “Amazing Stories” TV series, to bring in some fresh ideas. After working at Disney for about a year, he was invited to give a presentation on the studio to Eisner, Wells, Katzenberg, and other studio executives. He spoke for an hour, arguing that Raiders, Close Encounters of the Third Kind, Ghost Busters, Cocoon—“These are the movies that Walt Disney would have made today. They’re not dog and cat movies. They appeal to the child in everyone, not just children. They’re about the triumph of the human spirit.” In Vogel’s view, even Spielberg’s Schindler’s List, a story about a concentration camp, which had just opened to critical acclaim, could have been a Walt Disney picture.
Eisner was enthusiastic, and even though Vogel didn’t get much of a budget to implement his ambitious vision, he at least felt he was on Eisner’s radar.
As production rapidly geared up from fifteen to more than thirty films a year, it became harder to stick to the high-concept, low-budget comedies that had made the Disney formula such a success. It was a rule laid down by Eisner that no director could be guaranteed more than $1 million a picture, even as the going rate for top directors rose to the $3 million level. Katzenberg and other Disney executives constantly had to beg top directors and stars to take a cut to make a Disney film. On some projects, they settled for second-rate scripts and talent, like a project Katzenberg approved called “3000,” a dark story about a Los Angeles prostitute, which he insisted be rewritten as a modern-day fairy tale. The project was rechristened as Pretty Woman.
At a meeting to present the project to Eisner, Katzenberg explained the concept and said the film would star Julia Roberts, who was virtually unknown, and Richard Gere.
“You’ve got to be out of your mind,” Eisner said. Gere had been the star of the ill-fated King David. Eisner had never gotten over the fact that Gere had worn “skirts,” as he put it—actually authentic Hebrew garb of the period—which Eisner felt had alienated mainstream audiences and damaged Gere’s appeal.
Stung by Eisner’s tone, Katzenberg angrily pointed out that Disney didn’t have enough films in development that were coming together in time to meet its release schedule.
“If I have to say yes to this movie because we need a movie, then fine,” Eisner replied. “But this movie is going to be a bomb. It’s a failure before I’ve even seen it.” Then Eisner got up and walked out, leaving Katzenberg fuming and everyone else in the meeting speechless.
Just as Eisner had broken the budget mold at Paramount with Raiders, he was occasionally willing to gamble on a major “event” picture. Dick Tracy, an elaborate take on the famed cartoon strip, starring and directed by A-list talent Warren Beatty, rapidly soared above its $23 million budget and commanded a disproportionate amount of the time and attention of Disney studio executives, especially Katzenberg. Beatty was indecisive, a perfectionist, and insisted on numerous takes of scenes. Notoriously promiscuous, Beatty was having an affair with his co-star, Madonna, even while arranging afternoon trysts on the set with other women. Though charming, Beatty consumed vast amounts of Katzenberg’s time: He had to spend an inordinate amount of time on the set and had dinner with Beatty every night, either at the studio or at Hamburger Hamlet in West Hollywood. Dick Tracy eventually cost $47 million, which would have been far higher if Katzenberg hadn’t kept such close watch.
Pretty Woman, by contrast, already declared a failure by Eisner, was produced for a relatively modest $14 million. Producer Garry Marshall had to fight the usual budget battles, but succeeded in keeping the tone of the film cheerful and upbeat, a modern-day Pygmalion, in line with Katzenberg’s vision for the film. A scene where Julia Roberts’s character uses a trip to the bathroom to inject drugs was dropped; she flosses her teeth instead. Though Roberts’s character is surely one of the most virginal prostitutes ever portrayed on film, some Disney executives were concerned that it glorified prostitution. “It’s a fantasy!” Katzenberg responded with some exasperation.
Pretty Woman opened in March 1990. Despite Disney’s worries, Roger Ebert wrote in the Chicago Sun-Times that “It’s astonishing that ‘Pretty Woman’ is such an innocent movie—that it’s the sweetest and most open-hearted love fable since ‘The Princess Bride.’ Here is a movie that could have marched us down mean streets into the sinks of iniquity, and it glows with romance.” Only after he saw the opening weekend box office did Eisner concede the film might be a hit. Pretty Woman grossed $463 million worldwide, the most successful live-action film by far in Disney’s history.
Dick Tracy opened three months later, backed by an extraordinary $54 million marketing campaign. Reviews were mixed: praise for the stylish, bright
ly colored sets and costumes, but tepid reactions to the overall effect. The film grossed a respectable $100 million, which barely covered production and marketing costs. Merchandise tie-ins languished mostly unsold. Thoughts of turning Dick Tracy into an Indiana Jones–style franchise evaporated.
The excitement at Disney over the success of Pretty Woman, and the preoccupation with Dick Tracy, helped disguise the disconcerting reality that during that same year, something went fundamentally awry with the Disney formula. The nearly unbroken series of profitable films abruptly ended. For the first time, some studio executives began quietly questioning Eisner’s judgment, which no longer seemed infallible. After all, he had championed Dick Tracy, and dismissed Pretty Woman. Most of the studio’s live-action films, even low-budget ones, were commercial and critical failures, forgotten almost as soon as they disappeared from screens. The multiplex cinema phenomenon offered more opportunity but also more competition. Word-of-mouth and critical reception, so long the driving forces behind audience demand, began to give way to marketing blitzes, big stars, and “event” films that drew huge audiences to opening weekends. Other studios that year produced mega-hits Die Hard 2, Back to the Future III, Total Recall. Even the family audience flocked to the non-Disney Home Alone and Teenage Mutant Ninja Turtles, films that openly mimicked the Disney formula. By contrast, Disney produced the soon-to-be-forgotten Marrying Man, Run, Taking Care of Business, Spaced Invaders—to name a few—and turned down as too expensive the script for the Clint Eastwood thriller In the Line of Fire.
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