Harvey Entertainment Takes Control

The Harvey Entertainment Company, best known for such characters as Casper, The Friendly Ghost, Richie Rich, Baby Huey, Wendy the Good Witch and others, and Animation World Magazine are teaming up to bring our readers a series of six in-depth articles that will explore different aspects of one production. From over-all company business plan, to production to advertising, licensing and merchandising and distribution, we will learn about Harvey Entertainment's all CGI film,Casper's Haunted Christmas. This film is interesting to focus on as it represents one companys shift from licensing product to seizing control and producing product, thereby keeping all the rights in one profitable bundle. To start the series we are going to talk with Harveys President and Chief Operating Officer, Rick Mischel. First, however, lets learn a little about Harvey.

Harvey was founded in 1939 in New York City as a comic book company by brothers Alfred, Leon, and Robert Harvey. In the early 1950s, Harvey acquired the right to publish comic books based on Paramount Pictures cartoon characters. Later, they acquired the proprietary rights to Paramounts cartoon characters and its cartoon film library. Throughout the 1950s and early 1960s, the golden age of comic books, Harvey was considered one of the leading comic book publishers in the United States.

By 1982, the family vision for Harvey was blurred. The production of new comic books and the exhibiting of Harvey's cartoon library on television had substantially declined. In 1988, when the founder's heirs were unable to agree on the management or future direction of Harvey, the company was sold for $7.5 million. Through a series of strategic moves, Harvey has been changing its focus from a licensor to a producer and distributor of quality family entertainment. In 1999, a new management team, led by experienced entertainment industry professionals, Roger A. Burlage, Ron Cushey and Rick Mischel, took the helm to further this charge.

Prior to joining Harvey, Rick Mischel served as President of The Mischel Company, an entertainment company specializing in the production of feature films, the representation of completed films in the acquisition marketplace, and the advising of foreign-based companies on the acquisitions and sales of feature films and animated product throughout the world. He has also been a producer of feature films, like The Specials, starring Jamie Kennedy and Rob Lowe, which is currently in post-production. Prior to The Specials, Mischel served as Executive Producer on the feature film Suicide Kings, starring Christopher Walken and Denis Leary. Suicide Kings was released in April, 1998 by Artisan Entertainment.

Prior to August of 1997, Mischel was the Senior Vice President, Acquisitions and Production of LIVE Entertainment, a position he held since September of 1994. While at LIVE, Mischel was responsible for acquiring all product for LIVE Entertainment, including feature films and specials for both theatrical and television release, and animated, episodic and long form product for the Family Home Entertainment (FHE) label. Mischel also supervised the productions of feature films co-produced or co-financed with other companies, as well as supervising the production of original films, animated features and specials for FHE. His responsibilities also included the supervision of the marketing and distribution of FHE product.

While at LIVE, Mischel was the production executive on several LIVE feature films, including Aberration, a LIVE/Grundy co-production, No Way Home, which premiered on Showtime, and on the animated specials The Littlest Angel, The Musical Adventures of Tom Sawyer and the Australian-produced Scrooge Koalas Christmas.

Prior to LIVE, Mischel served as Vice President of Electric Pictures Corporation, where he was responsible for the development of feature film projects, the supervision of productions, including Jersey Girl, starring Dylan McDermott and Jamie Gertz, and Zandalee, starring Nicholas Cage and Judge Reinhold. Plus, he also oversaw business affairs for both domestic and foreign production and distribution.

As an entertainment attorney at OMelveny & Myers, Mischel negotiated and drafted agreements relating to the production, financing and distribution of domestic and foreign motion pictures and television programs for such clients as Paramount, Castle Rock Entertainment, Disney and HBO.

Mischel received his J.D. degree from Stanford Law School in 1987, where he was President of his graduating class, and an M.A. in International Affairs from The Fletcher School of Law and Diplomacy in 1984. He graduated Summa Cum Laude with a B.A. in International Relations from Tufts University in Medford, MA in 1983.

Heather Kenyon: Since Harvey Entertainment was purchased from the family in 1989, the company has been making a string of strategic moves. What have these moves been leading up to?

Rick Mischel: The company began as a place where they controlled certain proprietary, intellectual property rights, rights to certain characters, Casper, Richie Rich, all these classic characters. The company first started out as a licensor. They licensed the rights to make movies or create goods or make television shows to other entities that would then produce those shows and Harvey would get some participation. What has gone on in the last ten years is that the company has moved from being a licensor to a producer and distributor. We have taken control of our own destiny. Now we produce our own product. We control the distribution of our product. We fund much of the production costs of our product in order to maintain quality control and the control over distribution. Thats really the big change in the company.

The company went public in 1993, and that created more capital for the company to grow. In the last year, financially, the company went through a re-capitalization with the new management team. My CEO Roger Burlage and I came in and put in $18 million of capital in order to take these properties and exploit them in all media.

HK: And move them into new directions. Would you like to talk about any of the specific moves the company has been through that you think are key?

RM: The key things that have really contributed to the company growth are, of course, the success of the first Casper theatrical movie. The rights were licensed to Universal and Steven Spielbergs company Amblin and they produced the movie. The movie was a big success and that drove the companys licensing and merchandising success. Harvey, with Universal, produced the new Casper series which is very successful on television. The company also produced under a license to Warner Bros. the Richie Rich movie. That brought Richie Rich to a whole new audience and spread the word.

These moves helped drive our licensing and merchandising around the world. These decisions and productions really contributed greatly to Harvey getting on the worldwide stage, it is now more of a known player.

HK: We just reported that you posted some really nice quarter figures, so it is working, which is nice, isnt it?

RM: We are very focused on keeping our overhead low and driving up our revenues. We are getting there.

HK: Harvey has a portfolio that contains many classic characters -- Casper, the Friendly Ghost, Richie Rich, Baby Huey, Wendy the Witch, Hot Stuff. Are you updating these characters? What challenges have you been facing taking these classic characters in new directions?

RM:

Well, it is a challenge. When you look at classic characters the challenge is, you dont want to alienate the audience that loves them, that makes them classic, but you do want to refresh them and take them to new audiences and expand your audiences. With Casper, which is our most popular character, we are obviously very, very careful on any changes we do. We update Casper in the sense that we use the same image of Casper that was in the Universal movie, but we are very careful to maintain our family friendly audience for Casper and keep the jokes on a family level.

With our other characters, we sometimes have more flexibility. With Richie Rich for example were developing a script where Richie Rich goes to public high school. Hes now sixteen years old. We are trying to reach a broader audience; trying to reach the kids that know Richie Rich from the Macaulay Culkin movie that have grown up and are now fifteen, sixteen and we are trying to reach the kids that are six to twelve that still know the character. We are also trying to reach the nostalgic parents. So we take Richie, we make him a little older and we put him in a different situation. With Hot Stuff we are developing a live-action film where Hot Stuff is mischievous but not malicious. He definitely gets into trouble. It is a film that parents and kids will want to see. Again the imagery is a little updated. We have considered with some of our other characters Little Audrey, Little Dot really aging those characters up or looking at them in different situations. You have more flexibility with your lesser-known characters, but we look at each character and we decide what is the best way to go.

HK: I am sure it applies for the medium as well. A feature film needs to appeal to a broader group of people than perhaps a Webisode that is on your Web site.

RM: You are right.

HK: Will we be seeing any new Harvey characters or are you really focusing on the classics?

RM: Well we are focused on our classic characters but we are a company that has brand value in the family audience, in family friendly entertainment. We do look for other characters that we can bring into that fold, either through completed feature films or television shows that we can acquire and distribute here under the Harvey label or creating new Harvey characters through the acquisition of book rights, and pitches from writers and creators that come and see us. We have a property called Minerva Louise, a book property, that has been very successful, selling 750,000 copies in the U.S., and we are developing that as a pre-school animated series. We have some prime time animated shows that we are looking at as well. We are definitely open to it.

HK: Are you finding it difficult? Direct to video you already have distribution with Universal which is great, you have access to the market, but television is tough. Are you finding it difficult to sell into television?

RM: Television is tough. There is no doubt about it, but we try to align ourselves with studios and creative people that will bring a really fresh look to our characters and that is the way we think we will be able to penetrate the market. With originality and freshness and humor all the things that will make the property better.

HK: Quality will always make it I think.

RM: Thats right.

HK: Are you really looking to position Harvey as a family entertainment company, or is it, "Yes, we are going for family entertainment with our classic characters, but with our new characters who knows? Maybe theyll be edgier prime time type properties."

RM: We stay true to the family tradition. If we were going to venture outside of that we wouldnt do it under the Harvey label.

HK: You have made several direct-to-videos that have performed well. Casper, A Spirited Beginning sold over 3 million units worldwide. But, I get the feeling that Caspers Haunted Christmas, isnt just another of a string of videos. I have a feeling that this is in fact a sort of turning point for the company?

RM: It really is. It is the first Casper movie that this company has produced itself. It really represents that turn from being a licensor to a producer. It is our property and it is our movie, soup to nuts. We found the writers; we worked on the script; we found the studio, Mainframe Entertainment, to do the production; we found the recording artist to record the Casper theme, Randy Travis. It is our production and thats big for a company. It is the first one that we will own and control all rights to. It is our lead property when we go into the international market. We can now sell a very successful franchise property. The other thing that makes it different is that it is all computer animated. It is the first Casper movie that is computer animated so that is a real turning point for Casper.

HK: How did Harvey come to the decision of joining forces with Mainframe and approaching this version of Casper using all CGI vs. 2D? This is quite a daring move.

RM: We did that for a number of reasons. One we felt that there was a new found popularity in computer animated movies. Toy Story 1 and 2, Antz, A Bug's Life have all been very well received by kids. They like the medium. The second reason was we knew we were going to have to go out and compete with our other direct to videos because we don't distribute the other two Casper videos Saban and Fox do. So we wanted to create something that was different and new and distinctive from the live-action movies. This was a way to do that.

HK: Mainframe is great. Congratulations on working with them.

RM: They have been terrific. They have been a great, great partner to have on this production. They really have been very supportive. Theyve done everything on time. I have nothing but good things to say about them.

HK: You touched on this, but how does this video specifically play into Harveys long term business goals?

RM: It helps us when we go into the international marketplace and the distribution marketplace. We now have a product that commands the buyers interest. We have our library of the classic Harvey cartoons called Harvey Toons, which is 65 half-hours that we are selling internationally for the first time. Casper is a brand new product. It is ours and is something we can be proud of and publicize and really use to help in our other distribution efforts.

HK: Which markets will you be attending?

RM: NATPE, MIP, MIPCOM all the television markets.

HK: I think that Harvey has a real advantage because you are a smaller company, with resources, but you can really focus on the project, keep the budget in check, make sure all your departments are working for it as opposed to a bigger company where sometimes the projects dont turn out as well, despite the resources, due to a wide number of different initiatives.

RM: We are very focused on maintaining our level of quality. It is very important to us. We never take too much on that would affect anything else we would do. Very careful on that. We would rather have fewer things on our development slate and devote more of our time and effort to making those things really great product.

HK: I have been sitting here for three years, getting Harvey press releases, and it is interesting to have watched the company evolve to the point where the company is doing its own production. It is great to see a company say, "This is our goal," and in a course of time, actually do it. A lot of companies dont get there.

RM: Well, thank you! We certainly have great assets for the animation community so you will be seeing a lot more product coming out in the next three years in computer, 2D and Internet animation.

Heather Kenyon is editor in chief of Animation World Magazine.