January 24, 2006 2:19 PM PST
Steve Jobs' rise to movie mogul
Now, with the $7.4 billion sale of his Pixar Animation Studios to Walt Disney, on terms that make him the venerable movie conglomerate's largest shareholder, Jobs is moving more deeply into a Hollywood that he's always held somewhat at arm's length.
The deal marks a personal triumph for Jobs and the studio that has redefined American animation over the last decade. But it also serves as a reminder of just how much the high-tech, entrepreneurial culture of Silicon Valley has helped upend an entertainment business once defined by the films and other products of Disney.
"We consider (Pixar) to be the Disney studio of the 21st century," said Doug Ward, the manager of the animation program at the University of California at Los Angeles, which has sent several of its alumni to Pixar. "Disney really lost its place a few years ago, and now they're trying to catch up."
It remains to be seen whether Jobs will transform Disney, or whether the 82-year-old corporate giant will resist the Apple-Pixar chief's counterculture-inspired, tightly controlled approach. But the acquisition is likely to give Disney a new lease on a creative life, after growing critical assertions that the company was long past its prime.
"We welcome and embrace Pixar's unique culture, which for two decades has fostered some of the most innovative and successful films in history," Disney Chief Executive Officer Robert Iger said in a statement. "The addition of Pixar significantly enhances Disney animation, which is a critical creative engine for driving growth across our businesses."
Jobs' entry into the entertainment business came in 1986, when the 30-year-old former head of Apple Computer bought into Pixar, shortly after being pushed out of the computer company he had co-founded.
Pixar was primarily a hardware company at the time, a division of Lucasfilm that built high-tech computers to improve the computer graphics of the day.
In an interview with Time magazine in 1986, Jobs said he had looked at Pixar even before leaving Apple, but that nobody else at the computer maker had been interested. He bought a majority stake in the small Lucasfilm division for $10 million and quickly helped it sign deals to sell its $120,000 machine for decidedly non-Hollywood uses, such as analyzing government spy satellite data, or underground oil deposits.
The Pixar investment proved a costly one, as demand for the hardware and the company's early software proved low, however. According to the book "Apple Confidential," Jobs pumped in at least another $50 million to keep the company going in its early days.
The book quotes Jobs as saying, "If I knew in 1986 how much it was going to cost to keep Pixar going, I doubt I would have bought the company." The book also notes that in late 1994, Jobs contemplated selling the money-losing Pixar to Microsoft.
"What people don't realize about Pixar is that it was a really long and painful haul," said Bruce Perens, the open-source software pioneer who worked at Pixar for 12 years, until 1999. At one point, most employees even sold their stock back to Jobs, to help ease the financial crunch, Perens said.
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