Warner Bros. uninterested in DreamWorks Animation deal

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It’s looking unlikely that Shrek will share a home with Bugs Bunny.

When Paramount Pictures formed its own animation division -- and privately signaled that it was not looking to continue its distribution deal with DreamWorks Animation under current terms -- many in Hollywood began speculating about which studio DreamWorks Chief Executive Jeffrey Katzenberg might partner with next. Because DreamWorks doesn’t have its own theatrical distribution and marketing operation, it has relied on Paramount since 2006 to place its movies in theaters and promote them.

Warner Bros. was seen by many as the most likely new home, since it is the only one of the six major studios without its own feature animation unit. Some even theorized that the studio’s parent company, Time Warner Inc., could acquire DreamWorks Animation, adding its films to Warner’s library and potentially having it provide fresh animated content for the conglomerate’s Cartoon Network cable channel.

However, people familiar with the thinking of top executives at Burbank-based Warner Bros. and New York-based Time Warner say such a deal does not appear to be in the cards. Time Warner is not interested in acquiring DreamWorks Animation, the people said, given the likely $2 billion-plus cost.

Top film executives at Warner Bros., meanwhile, feel that releasing future DreamWorks Animation movies would not be a good use of the studio’s distribution and marketing resources for anything close to the 8% of revenues that Paramount has collected for the service.

Of course, DreamWorks Animation’s current agreement with Paramount ends in 2012 and the latter studio has offered to extend it for one more year on the same terms. That leaves plenty of time for things to change and deals that currently seem implausible to come together.

But for now it appears that DreamWorks Animation’s options are limited. Universal Pictures is said by people familiar with the matter to be a possible partner. But Universal is already committed to its Illumination Entertainment family films unit, which is currently ramping up from one to two movies per year. Balancing its needs with DreamWorks would be tricky.

The other three major Hollywood studios -- 20th Century Fox, Sony Pictures and Walt Disney Pictures -- have animation divisions and are said not to be interested in a DreamWorks deal.

If it can’t reach an agreement with one of the top Hollywood studios, DreamWorks would have to either release its own movies -- and start shouldering their huge marketing costs for the first time -- or work with a patchwork of different distributors around the world.

Spokeswomen for DreamWorks Animation and Warner Bros. declined to comment.

-- Ben Fritz

Related:

Katzenberg chatty on 3-D and ‘Kung Fu Panda 2,’ silent on HBO and Paramount

DreamWorks Animation stock up on news of Netflix deal

Paramount’s new animation division spells likely end for DreamWorks deal

A scene from 2010’s ‘Shrek Forever After.’ Credit: DreamWorks Animation.