Acquired
02:14:37 · Ben Gilbert, David Rosenthal
[02:14:37] S0: They made Fantasia two thousand sixty years later? No? [02:14:41] S1: Yes. The, that is true, but that is not what I was getting at. So, yeah, the initial release of Fantasia, as you said, was a total flop. They couldn't exhibit it anywhere, lost tons and tons of money. Later, it has this huge resurgence. I mean, I remember when I was growing up as a kid, my parents loved Fantasia. [02:15:01] S0: Yeah. I actually thought Fantasia was a modern movie. It's crazy to me that it was Disney's second. [02:15:04] S1: Right. Right. Right. I think it was, like, the sixties and the hippies that thought, like, oh, this is, like, the coolest thing. So Fantasia, if you look today at the list of inflation adjusted top films in history, by box office gross inflation adjusted, Fantasia is the twenty fourth highest grossing film in Hollywood history. Unbelievable. So it has [02:15:30] S0: And our whole second kinda timeless. [02:15:33] S1: Totally. It's an amazing, amazing production. I mean, the music, the symphonies, the sound. It's watch Fantasia if you've never seen it. It is well worth your time. [02:15:43] S0: And now a hard cut over to World War two.
02:15:43 · Ben Gilbert, David Rosenthal
[02:15:43] S0: And now a hard cut over to World War two. [02:15:45] S1: Right. Yeah. Yeah. Yeah. So back to 1941, no sooner does Roy settle the strike than Pearl Harbor happens, and The US now enters World War two. And unlike many of the other great American companies of that era that we've covered on this show before where World War two was great for their business like Coca Cola or Mars or Lockheed, World War two is a disaster for Disney. Nothing of value gets built for Disney during the war. It basically breaks every single node in the flywheel. And on top of the strike, it just completely grinds to a halt all new core IP production for the studio. [02:16:36] S0: Yeah. So the first thing that happens is within hours and then days of Pearl Harbor getting bombed, the US military moves into the studio. Yes. They look at Burbank, and they think this is a great asset. And so Do you know why? Hundreds of troops, there are two reasons, that set up shop using the sound stages to work on all the optical systems for antiaircraft. Sound systems are awesome. There's no windows. It's a giant room. The I mean, like, it's it's the the thing you would want for stuff like this. The second reason that I suspect you're hinting at, David, is it is real close to Lockheed.
02:16:36 · Ben Gilbert, David Rosenthal
[02:16:36] S0: Yeah. So the first thing that happens is within hours and then days of Pearl Harbor getting bombed, the US military moves into the studio. Yes. They look at Burbank, and they think this is a great asset. And so Do you know why? Hundreds of troops, there are two reasons, that set up shop using the sound stages to work on all the optical systems for antiaircraft. Sound systems are awesome. There's no windows. It's a giant room. The I mean, like, it's it's the the thing you would want for stuff like this. The second reason that I suspect you're hinting at, David, is it is real close to Lockheed. [02:17:12] S1: Yes. Real close specifically to Lockheed Skunk Works department, which is in Burbank. The secret Lockheed Skunk Works airplane hangars and and department was in Burbank because Burbank was the sticks back then, and Disney is right next door. So that's probably the bigger reason why the military requisitions the Disney lot is to protect skunkworks. Fascinating. [02:17:40] S0: Yeah. So you've got that happening. You've got a whole bunch of the animators getting drafted. Yep. I mean, so you're you're you're down manpower. You're just coming out of the strike. You have these huge failures in Pinocchio, Fantasia, and also Bambi. Again, you've lost European distribution. [02:17:55] S1: Yep.
02:17:55 · David Rosenthal, Ben Gilbert
[02:17:55] S1: Yep. [02:17:55] S0: And so the appetite for making more things like those three movies drops to, like, zero. Yeah. I mean, at this point, there's a financial reality that Disney owes a dividend to these shareholders, which interestingly enough, it actually suspended. In 1942, they actually didn't pay out the dividend, but they do have to pay Bank of America. The films aren't gonna be the thing doing it. And, conveniently, they've got the US government saying, can you help us with some propaganda films? [02:18:22] S1: Yep. [02:18:22] S0: Can you help us encourage people to pay their taxes and buy war bonds and support the troops? And so Disney kinda looks at everything, how it's all playing out and says, yeah, that's what we're gonna be doing for the war. [02:18:35] S1: So all of the studio production work during The US's time as an active participant in World War two, yeah, basically, just gets repurposed to propaganda and training materials for the government. [02:18:49] S0: And insanely, they do use Disney IP. Like, you see all these crazy old posters with, like, you know, Donald Duck holding a gun. And, I mean, the the stuff you sort of would never see with these characters today. But not only did Disney say, we're work for hire, they said, we we can use the Disney IP. But interestingly, David, do you know about Mickey Mouse's role? [02:19:12] S1: Oh, no. [02:19:13] S0: They really did not employ Mickey Mouse. They protected Mickey Mouse from the war image, and Donald Duck sort of led the [02:19:23] S1: charge Interesting.
02:19:23 · David Rosenthal, Ben Gilbert
[02:19:23] S1: charge Interesting. [02:19:24] S0: On all the the the war films. [02:19:26] S1: Well, part of this is because, canonically, Donald Duck is a sailor. [02:19:29] S0: Right? Okay. That makes sense. [02:19:31] S1: Yeah. Yeah. But then it makes sense to protect Mickey too. [02:19:34] S0: And Donald's also the more, like, fighter out of character. Yeah. Mickey started off as this troublemaker, but then kinda became the, like, nice protagonist. [02:19:43] S1: Yeah. The goody two shoes, and then Donald was the foil. Yeah. Yeah. So all of this, though, to our point earlier, does nothing either for the flywheel model or for generating new IP to feed it. [02:19:55] S0: Or pushing the envelope of technology or pushing the bounds of creativity, like all the things that contribute to Disney's core. Yep. They they are financially floated, though, by the war. I mean, the way that they make it through this period is they they actually are generating net income reliably. Not a lot. [02:20:12] S1: But From the government work? Exactly. And there's one other big innovation, an actual bright spot that comes out of this back against the wall moment during the war that the company's in financially. Do you know what that is? Oh. [02:20:29] S0: Oh, the Disney Vault. [02:20:30] S1: The Vault. Yes. Yes. So in 1944, the company is so cash strapped that they come up with the, again, at at the time, crazy seeming idea to rerelease Snow White in theaters because, hey. We can't make new stuff, but people sure like that old movie. Let's just put it in theaters and see what happens.
02:20:30 · David Rosenthal, Ben Gilbert
[02:20:30] S1: The Vault. Yes. Yes. So in 1944, the company is so cash strapped that they come up with the, again, at at the time, crazy seeming idea to rerelease Snow White in theaters because, hey. We can't make new stuff, but people sure like that old movie. Let's just put it in theaters and see what happens. [02:20:53] S0: And the thing you gotta remember is with no home video and no TV, no one had seen Snow White in seven years. [02:20:59] S1: Exactly. [02:21:00] S0: It truly vanished off the face of the earth except for the copies of the film that were held in the Disney vault. [02:21:05] S1: In the Disney vault. Yes. So in 1944, they rerelease Snow White in theaters, and it brings in $3,000,000 in revenue to Disney on just a, like, a few 100,000 in cost. They basically just gotta print a few new copies of the film and then distribute it out to theaters. [02:21:28] S0: Right. The theaters get their normal cut. The distributor gets their normal cut. But Disney's cost to develop the film is, like, zero zero. [02:21:33] S1: Yeah. They've already developed it. It's already done. This is an enormous boost for the company. And, Ben, to your point about the seven year gap since the initial release, it turns out conveniently that seven years is just about the right amount of time for a new generation of children to come along and reach an age, where they would be interested in consuming Snow White that haven't seen it before, and they discover it for the first time. And yet it's infrequent enough that it doesn't dilute the IP.