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While The Avengers was #1 last year, Brave and Wreck-It Ralph were #13 and #14 on a worldwide basis. Combined, the two animated flicks brought in almost $1 billion at the box office and their DVD sale numbers will be among the best in the industry. Not bad for a combined production investment of $350 million.

But, is DreamWork Animation's trouble a sign that the high-cost animation market is reaching capacity for product? Disney's 2011 Mars Needs Mom's is the industry's biggest bust with its production budget to $150 million and worldwide revenue of $39 million. But, Rise of Guardians was #26 at the box office in 2012, had a production budget of $145 million, and earned $302.6 million, yet was still a major financial disappointment for DWA. I wonder if DWA's troubles will lead it to be sold to someone who has the deep pockets to be able to absorb a really bad showing at the box office.

Don't get me wrong. Animation still sells. Ice Age was #5 and Madagascar was #8 in 2012. Even low budget Dr. Seuss came in at #21. But the Disney marketing machine could only produce $19.2 million for Arrietty in the US. But, unless a new technology arrives that drives down the cost of top-flight animation, there is the risk that the cost of production will be such that a major failure at a smaller studio like DWA will cause them to cease production or at least exit the high-end market.

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