Pixar vs. Disney Animation: John Lasseter's Tricky Tug-of-War

"Frozen's" success shows the house that Walt built can compete with a sibling rival that is enduring layoffs and criticism of its sequel strategy even as box office booms.

This story first appeared in the Dec. 13 issue of The Hollywood Reporter magazine.

The contrast couldn't have been more stark. On Nov. 22, Pixar Animation Studios laid off 67 employees, about 5 percent of its 1,200-person workforce, as the release of its next feature, The Good Dinosaur, was delayed 18 months to November 2015. That left Disney without a new Pixar movie on next year's schedule for the first time since 2005.

Just five days later, Walt Disney Animation Studios opened Frozen, its 53rd feature, in wide release and set a Thanksgiving weekend record with $93.6 million domestic -- topping Pixar's Toy Story 2 benchmark from 1999. The icy sisterhood tale established itself as a frontrunner for the animated feature Oscar, a category Pixar has dominated. Further underscoring the resurgence of WDAS, Frozen was accompanied by a new short, Get a Horse!, that could win the Oscar in that category.

PHOTOS: Brrrrrrr!: Disney's 'Frozen' and 19 Other Wintry Movies

It's a reversal of fortune of sorts, even as Pixar continues to dominate at the box office. (Its June release Monsters University took in $743.5 million worldwide, surpassing 2011's Cars 2, which grabbed nearly $560 million.) Critics have carped that the studio is relying too heavily on sequels and has lost some of its creative mojo. Meanwhile, WDAS, which long lagged behind Pixar in prestige and profit, has been on a hot streak since 2010's Tangled managed to appeal both to boys and princess-loving girls. "I think the studio has gone through something of a renaissance," Rich Moore, who directed WDAS' 2012 hit Wreck-It Ralph, told THR earlier this year.

Disney's $7.4 billion acquisition of Pixar in 2006 put rival siblings under the same man, Pixar co-founder John Lasseter, working alongside Ed Catmull. Splitting time between Pixar in Emeryville, Calif., and Disney's Burbank lot, Lasseter gets credit for breathing life into WDAS, which stumbled through the 2000s with such flops as Home on the Range, Chicken Little and Meet the Robinsons. But some question whether he is stretched too thin as his studios and other parts of the Disney empire, including consumer products and park design, vie for his attention.

Borrowing a page from Pixar, Lasseter is hands-on at WDAS. He gives extensive notes, pores over story reels and even does the first reading with actors and directors. Initially, Pixar animators worried that he was spending too much time at Disney, where he overhauled Bolt and Tangled. Now that the situation has stabilized, he divides his focus. "Both places think he spends too much time at the other place," says a friend. "That's the true telling point."

STORY: Pixar Laying Off 5 Percent of Headquarters Staff

At Pixar, every project is workshopped through the so-called Brain Trust, the company's top leaders. If a movie encounters problems, the studio doesn't hesitate to boot directors midstream. Brenda Chapman was replaced by Mark Andrews on 2012's Brave, which won the Oscar. Dinosaur hit a wall when director Bob Peterson couldn't crack its third act. He was taken off the film, though he remains at Pixar.

WDAS has instituted a similar system called the Story Trust, but its meetings are considerably more polite, says one insider: "People are more concerned about ruffling feathers and hurting feelings." WDAS also might be more open to fresh talent. Agencies usually don't send writers to pitch Pixar, where most ideas are generated in-house and directors work their way up the ladder. At WDAS, by contrast, Jennifer Lee was an outsider brought in to work on Ralph then shifted to Frozen. Her suggestions reshaped the project, and she was upped to director with Chris Buck, which one insider says never would happen at Pixar.

WDAS has reached a point where it is developing its own star filmmakers, much as Pixar did with Pete Docter (Up) and Andrew Stanton (Finding Nemo). Byron Howard, who helmed Tangled with Nathan Greno, is directing Zootopia for a March 2016 release. And the company's November 2014 film Big Hero 6, the first theatrical animated movie drawn from Marvel characters, is being handled by Don Hall, who directed 2011's Winnie the Pooh.

STORY: 'Frozen,' 'Croods' Among Annie Nominees for Best Animated Feature

But Pixar hardly is down for the count, though. "Hollywood won't be happy until they have a big honking failure," snarks one observer, noting that Pixar's run of hits has yet to be duplicated. If Disney weren't exploiting its library for sequels, analysts would squawk that it is squandering resources. And so Finding Dory, a sequel to 2003's Finding Nemo, is coming in 2016.

Lasseter, who directed Cars and its poorly reviewed sequel, has defended the sequel strategy, saying good characters and a good story are what make good movies. Disney CEO Bob Iger, to whom Lasseter reports, is a big supporter of Pixar's sequel strategy and the box office it generates.

But three of the studio's next four releases will be originals. Docter is readying Inside Out, set in the mind of a preteen, for June 2015. A retooled Dinosaur will follow that November, then an untitled movie about the Mexican holiday Day of the Dead.