Jeffrey Katzenberg

This interview appeared in the MIPCOM 2013 issue of World Screen.

Jeffrey Katzenberg, the CEO and director of DreamWorks Animation, shares with World Screen his vision of the future of entertainment and how digital media and technology are revolutionizing the business.

WS: Where do you see digital delivery taking the movie industry? You have talked about consumers paying for movies by the inch—would you explain that?
KATZENBERG: There are many different transformations that are occurring in our business. If you go back 75 years, people saw movies on movie screens. And then television screens came along, and then computer screens, now it’s smartphones. I do imagine a moment in time, while I’m still around, that when movies will come out, they will be in theaters for a period of time, a reasonably narrow window, but an exclusive window in which they can be enjoyed in what is the premium experience for which they are created. The movies we make here today are made to be seen on the biggest possible screen with the best possible sound, in 3D, and we work really, really, hard and invest incredible sums of money to ensure that each time our audience goes into a movie, they are dazzled visually by what they see. It is one of many goals we have for each movie that we should take our audience to a place they have never been to before.

After movies come out of the theaters, there are many windows they travel through. Rather than pay based on where in the time continuum you get to experience a movie, you are actually going to pay for it based on the quality of the image and the experience that you have. Seeing a movie on a smartphone is a terrific way to watch, but it’s not the same as watching it on a TV screen, which is not the same as watching on a movie screen. So I made the analogy that you’ll pay for what you watch based on the size of the screen you watch it on. If you watch in on a smartphone, you’ll pay 99 cents. If you watch it on a tablet, you’ll pay $1.99. If you watch it on a TV screen you’ll pay $4.99 and if watch it projected on a wall in your house, you’ll pay $15.99. You go to an IMAX theater and see it on a jumbo 90-feet screen, it will be $50 and it will be something dazzling.

WS: What new opportunities is the digital world offering?
KATZENBERG: I think there is actually much bigger opportunity. There is a whole new platform that is very quickly revealing itself as a new form of engagement for audiences. Here is the way I would explain it. In the 1950s, television came along and it filled these very big gaps that existed in all our lives, meaning, what do you do before you go to school, before you go to work, while a housewife is doing chores around the house, coming home after work, after dinnertime, on weekends? This incredible thing called television—the linear experience—filled these gaps. Six and a half hours a day, that is what the average American is spending watching television, it’s kind of astounding.

Then about four or five years ago, a confluence of things happened that started to reveal that in addition to these gaps that people have in their lives, they also have spaces—the in-betweens. The in-between is when you are waiting for an appointment. Or when you’re on a bus going to your job. Or you are waiting for a friend outside a store. Or you arrive early to a dinner at a restaurant. In your day, there is an amazing amount of in-between moments. Suddenly a portable device comes along that allows you to fill those in-between moments. I first became aware of this with very simple casual gaming. Certainly there is texting, sharing, searching, but from an engagement standpoint, casual gaming stopped me in my tracks—everywhere I went I noticed people were playing Tetris.

This is a very fast evolution that is driven by the device itself. Today, we have in our hands devices that can deliver rich media instantly. Five years ago that did not exist. As these devices got smarter and smarter, so became the quality of what you could do in these spaces. Today, and this is where AwesomenessTV comes along, and what Brian Robbins calls “Bits, bytes and snacks,” which are filling this incredible place of opportunity. I’ll say something certainly bold, it may turn out to be stupid, but I’ll say it: five years from now, the in-between moments that we have in our lives—and the smartphone is going to expand what we can do in those moments—are going to be as valuable as the gaps. Because our lives are getting filled up with many, many, more things everyday, we will have more in-between times than gaps and in a handful of years the value of that in-between time will be as valuable as what we call television today.

And there is a very powerful accelerator in all of this and that is YouTube. Because, as I said, there are two things happening: on the one hand, I’m watching casual gaming and the power of a device that has become a new platform, and the other hand I’m watching user-generated short-form content on YouTube, which is completely on fire, and these two things are converging.

I think people are going to be surprised by what starts to happen in these spaces. I will not be surprised if three or four years from now there will be a series as compelling and as exciting to me as Homeland is, and for which I get a five-minute episode every day, and pay for it. If somebody could tell me that starting next year there will be another season of Breaking Bad but it’s going to be in snacks rather than in full meals—every day five days a week, I’ll get a five minute serial on Breaking Bad—I would be there.

WS: And DWA is ready to create these snacks.
KATZENBERG: That’s the partnership with AwesomenessTV and Brian Robbins. There are two things about Awesomeness, the first is the business itself, which we are all impressed with and saw the value in, but we could not possibly separate that from the talent and genius of Brian himself. Here was a guy who created the first hits for Nickelodeon and who understands kids and tweens and teens as a storyteller as well or maybe better than anybody working today, who suddenly devotes his creativity and his resources to creating this short-form content, and he is perfect. If you watch the things that he is creating today, they’re dazzling. Brian Robbins is going to be one of the true great stories in this space. He already is but he’s only just getting started.

WS: Over the years what have you found to be some of the best ways to nurture creativity and to inspire great storytelling?
KATZENBERG: A lot of that is by creating a great environment for talent. If you came here to the DWA campus, you’d see it in a second. This company exists to celebrate creativity and storytelling. We work very hard here to ensure that people actually love their work—not like it—love it. If people love their work and they love coming to work, then we win. I wish I had understood many years ago what I understand today. I’m certain that if I have an epitaph it will likely be, “If you don’t come to work on Saturday, don’t bother coming on Sunday.” I have to say I did say those words; I’m guilty. And I also have to say that when I said them I actually meant them! But I was not as smart then as I am today. I’m not saying that hard work isn’t great but I don’t consider what I do work, it doesn’t feel like work because I love what I do so much. It’s so rewarding and it’s so exciting and interesting that I can’t even associate the word work with it. And that is what we try to create for people here. They come every day here and to the studios in Northern California and our studio in Bangalore to be creative and to make great films, television shows and short-form content. I hope they don’t think of it as work.

WS: DWA has always made it a point to stay abreast with technology. Could you give some examples of how technology has changed or enhanced making an animated movie?
KATZENBERG: We are a technology company, in fact, if you look at the creation of digital images, the technology platform that we are working on today is a step ahead of anything that exists anyplace else. And the reason for that is we always have wanted to have our artists feel that if they can dream it, they can make it. We actually use technology to fulfill their imagination.

To give you an example of the process of making a movie here, just recently we saw the sequel to How To Train Your Dragon. I remember when the creator/writer/director of the movie outlined his story, one of the things that was very important for him in the second movie was that the world of dragons was suddenly going to become vast, and dragons would [be able to] do all sorts of things. One of the very first things he did was sit down with our animation technology department and talk about his ideas. I remember him saying to our CTO [chief technology officer] that he wanted a dragon to be able to go under water and breathe fire. The CTO said, “Wait a minute, how can he breathe fire underwater? How is that possible?” The guys here looked at the creator like he had lost his mind, but they said, “OK we’ll get back to you next week.” They went off to figure out how they could do that. Our technology is at the service of our artists.

From a business standpoint, we are three months away from completing a four-and-a-half year data technology initiative, the biggest ever undertaken by this company and probably by any entertainment company, which we did in partnership with Intel. We created a new form of software to make our animated movies. Many, many, many, tens of millions of dollars have been spent to create this; it was really a man-on-the-moon project when it started. We wanted to see if we could truly change the nature of how we do animated films. And by the way, this has implications for anybody involved in any form of graphic arts or digital imagery. We are the R&D center of it and its success will be valuable for many industries and many businesses, which is why Intel invested in it. The end result of this, which is already being delivered, is that it’s the first time that a new technology has allowed us to actually do three things: to be better, to be faster and to be cheaper. A common business equation is that in the rule of better, faster, cheaper, you can get two, but you never get three. You can get faster and better, but it ain’t cheaper. You can get faster and cheaper, but it ain’t better. For the first time ever, at least in our experience, we have something that is better, faster and cheaper and to get specific about it, the cost of our movies starting this year, for what will be delivered at the end of next year, will go from $150 million to $120 million, and yet the quality of the images we are able to create will actually go up.

So technology has been more than our friend, it has been an essential foundation for what our artists do. And interestingly, here on this campus, we refer to our tech talent as artists. Somebody who writes great software is as creative and artistic to us as somebody who creates a beautiful image.

WS: How important is 3D to the future of movies?
KATZENBERG: It’s a mixed bag unfortunately. It’s particularly disappointing to me because I feel like we were one of the very first to come to 3D. We made a big gamble and a big investment and really stepped out along with Jim Cameron, who was on the live-action side, we were on the animation side. We didn’t stick our toe in the water; we dove right in. I feel that we actually delivered on the promise of 3D for our audience. Unfortunately, I don’t think that everybody else did. It really took away from the excitement of the experience. Some people are really interested, but I think a large part of the audience just doesn’t really care anymore.

The good news for us is that because we have amortized the investment we made in building a 3D platform here, in terms of every aspect of our design and our storytelling and our storyboarding and our filmmaking, it actually doesn’t add incremental cost anymore. We have the capability to do it. I think 3D makes our movies visually richer, even when you see a 3D film in 2D, it’s a different visual experience. So we are going to continue to make them in 3D. However, 3D has not achieved my hopes and ambitions as a platform, particularly in television. There was never any content that made it of value for TV, ever. A little bit of sports, but it never transitioned from theater into the home experience in any meaningful way. The consumer-electronics business delivered their end of it. They had beautiful TV sets; some of them were glasses-free. It was the content business that never stepped up.

WS: Of all the movies you have produced, with which did you have the most personal connection or involvement?
KATZENBERG: I have twins, a boy and a girl. They’re 30 years old, so they are not children anymore. You would never presume to ask me which of my children I love best.

WS: No I wouldn’t. OK, so I’ll just move to the next question! I see where this is going!
KATZENBERG: But having said that I will tell you two things. There are two movies over the years that had a more personal connection for me. One was The Lion King because the story of The Lion King was an idea that came out of a personal experience in my life. So when I watch The Lion King, I don’t see the same movie that everybody else sees, because of a specific set of circumstances that happened to me when I was in my 20s that left these very strong feelings and impressions on me. That story is a fable off those incidents that happened in my life. So when I’m watching that, it’s not so much a movie!

And the other, the riskiest movie that I have ever been involved in is Spirit: Stallion of the Cimarron. It’s the story of a wild horse. It’s a purely animated film, the protagonist doesn’t speak, and it’s almost a silent film in that way. For me it celebrates the animators more than any movie of modern times. I have this admiration and appreciation for the artistic work that went into that movie. It was one of the last hand-painted animated movies.

WS: What do you consider to be the most important contributions you’ve made to the motion-picture industry?
KATZENBERG: I’ve been very lucky. I have had incredible business success and that success has given me lots of resources. The things I have the greatest sense of accomplishment for are the things I did for other people rather than the things I have achieved for myself. I remember when I came to Hollywood for the first time. I was 23 years old; it was the early ’70s. I came from New York. I have this incredible almost déjà-vu moment. It was the middle of winter and I remember driving down Sunset Boulevard in a convertible and seeing for the first time this world with the billboards up there, winding into the Beverly Hills Hotel. All of this was so much greater than anything I had ever seen or known or imagined. For me, at the time, to succeed in this world meant two things: own a house on the beach in Malibu and win an Academy Award. If you do that, you’ve made it. So I got a house on the beach in Malibu but I didn’t get an Academy Award till this year. The thing that was interesting about this, which I didn’t really understand until it happened because, frankly, it was unexpected, was that it was not something I worked for. It’s The Jean Hersholt Humanitarian Award. We got an Academy Award for Shrek, yes, you get Academy Awards for movies that you make, but I never thought of [a humanitarian award]. Interestingly, that turned out to be the most important thing that happened to me in the movie business, and it has nothing to do with movies, because that was for work that I did and my wife did on behalf of other people and not on behalf of us.