With just three weeks to go until a self-imposed Labor Day deadline, DreamWorks Animation is coming down to the wire in talks for a distribution deal with 20th Century Fox or Sony Pictures.
Those two studios are now the top candidates to replace Paramount Pictures as the distributor of DreamWorks movies beginning next year, according to knowledgeable people not authorized to discuss the matter publicly.
Forged in 2006, the partnership between Glendale-based DreamWorks and Paramount has been largely successful, with both studios benefiting from hits such as the "Madagascar," "Shrek" and "Kung Fu Panda" series. But the studios sparred over the terms of a contract renewal. Under the current deal, Paramount collects 8% of revenue generated by DreamWorks releases.
Negotiations to secure a new partner, however, have been complicated by numerous issues, and neither Fox nor Sony is ready to commit to a multiyear, worldwide deal, sources said. One sticking point: How to balance DreamWorks Chief Executive Jeffrey Katzenberg's desire for the best release dates for his movies with the need to support a studio's own pictures. Both Sony and Fox have their own animation units.