Toonz Animation India Pvt. Ltd.

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Case Details:

Case Code : BSTR217
Case Length : 20 Pages
Pages Period : 1999-2006
Organization : Toonz Animation India Pvt. Ltd.
Pub Date : 2006
Teaching Note :Not Available
Countries : India
Themes: Growth Strategy
Industry : Media, Entertainment, and Gaming

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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.

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"We were the first to pioneer original animation programming in India and we intend to carry that forward."¹

-P. Jayakumar, CEO, Toonz Animation India Pvt Ltd, in 2005.

"Even if 100 studios more were to open in India, I wouldn't dub them as competitors as there is a lot of demand and work for all."²

- Riyaz Babu, CEO, Pentamedia Graphics³ , in 2005.

Introduction

In April 2006, Toonz Animation India Pvt Ltd (Toonz), a major Indian animation studio, and Percept Picture Company (PPC)⁴ , announced that they were planning to release the movie Hanuman II in late 2007.

This movie was to be a sequel to Hanuman,⁵ India's first commercially successful full-length animation film. The sequel was to be made using 2D and 3D animation with a budget of Rs. 90 million, the highest for any animation film in India.

Toonz was established in 1999 at a time when India had started doing outsourced animation work for European and American companies. Toonz provided animation services at prices that were 25 to 40% lower than other Asian animation studios.

The company made steady progress in the initial years and was successful in securing a number of contracts from major studios.

Toonz gradually gained a reputation for high-quality work. In 2002, it even figured among the'Top Ten Studios to Watch' in the Animation Magazine⁶. However, the top management at Toonz was aware that the greatest opportunity for growth lay in creating original content and not in doing outsourced work.

In 2002, it created an original series - The Adventures of Tenali Raman - which proved to be a success and made a name for the company. On the strength of the success of the series, Toonz entered into several co-production deals with Indian and foreign broadcasters, production houses, and animation studios.

Though the company was optimistic about its future prospects, the severe dearth of talent in the animation industry was a nagging problem. Also, the domestic animation market in India was not developed which forced Toonz and other Indian animation studios to depend on overseas studios for work. In spite of these challenges, the company saw several opportunities for growth.

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1] "Animated discussions," www.asiapacificdirect.com.au, December 2005.

2] "Animated feature films and funding challenges," www.animationexpress.com, January 22, 2005.

3] Chennai-based Pentamedia Graphics is a major player in the Indian animation, graphics, and special effects sector. Pentamedia has worked on prestigious 2D and 3D animation projects like Alladin, Sindbad, etc.

4] Percept Picture Company (PPC), established in 1993 is India's leading content creation, aggregation, and distribution company, which offers its services in producing motion pictures, television software, ad films, corporate films, live events, and special projects and in distributing and marketing motion pictures.

5] Hanuman was based on the story of a Hindu God by the same name and depicted His life and adventures. It was created by V.G. Samant of Silvertoonz. It grossed revenues in excess of Rs. 150 million and won several awards. The original was made in Hindi and was later dubbed in English and several Indian languages. It took over four years for 120 people to sketch 150,000 drawings to complete the film.

6] The California-based Animation magazine is the only monthly trade magazine covering the animation industry around the world. It also brings out an annual publication - 'Animation Industry Directory', which includes more than 6,500 company listings and contacts in the animation business.