News stories about Disney are often read around the world, but major news about lesser-known animation companies are generally ignored by the national press. One important story that was treated this way began to unfold in public on April 3, 1996, when a San Francisco Chronicle story headlined, "Colossal Pictures to Lay Off Third of Staff." This item was followed by rumors that the company, one of the mainstays of the local animation industry with a staff of about 130, had given pink slips to 40, 80, 100, and even 120 people.

In June, the Chronicle ran a second story noting that they had filed for Chapter 11 bankruptcy protection. The rumor mill in the local film community seemed to go out of control, and there was even talk that Colossal was out of business. The company issued press releases explaining what had happened, but it appears the writers at several trade magazines didn't read them. Instead, they continued to run stories that suggested things at Colossal were bigger and better than ever.

Drew Takahashi.

Colossal Pictures, founded in 1976, became well known in the 1980s for its innovative design work. They pioneered the "Blendo" look that featured a mixture of different animation techniques in the same commercial. Often live-action footage or photo montage was included along with stop-motion, cel animation, drawn images and other techniques. They also developed the Liquid Television and Aeon Flux shows for MTV and are known for their music video productions for The Grateful Dead, Bobby McFerrin, Primus, The Kronos Quartet, Peter Gabriel, and other stars. Their feature work includes titles for such films as The Black Stallion, Peggy Sue Got Married, andBram Stoker's Dracula. They did special effects for The Right Stuff, Top Gun, Demolition Man and Running Man. In addition, they provided animated sequences for Natural Born Killers and Tank Girl.

Today, Colossal has undergone an extensive reorganization. They consolidated their operations in one building (there had been four). They now have around 40 people on staff, including a new CEO. And Drew Takahashi, co-founder and chairman of the board states that, "We can look forward to being out of Chapter 11 in 1997."

What Happened
The changes that occurred in 1996 were triggered by the rising costs of doing business and a drop in the company's profits. The animation division had become so large it was not only unwieldy to run, but it was also less profitable than it had been in years past. It was decided that it was wiser to restructure the company and concentrate on the development of well-written and designed projects, rather than maintain all the facilities and staff needed to execute animated, live-action, and special effects work. It was especially difficult to maintain its high-tech computer facilities, which require constant upgrades of equipment and software. It was decided that, in the future, they would send the production of their animated and special effects work out to other companies.

Colossal eventually consolidated their activities at their facility at 101 15th Street in San Francisco. Prior to doing so, they had their ink and paint service in one building, the animation department in another, the administrative office, a design department and other services in a third, and stages, a model shop, a camera room and other facilities at a forth location. Drew Takahashi says it was just too much to keep track of.

Just as important to the survival of Colossal as the downsizing of space and staff were the changes made in the administration. Gary Gutierrez, who co-founded the company with Takahashi,left to pursue his desires to work as a filmmaker on feature productions, though he still remains a stockholder and believer in Colossal's future. Takahashi has stepped aside as president and CEO to become chief creative officer and chairman of the board of directors. In December, Brooks McChesney was appointed president and CEO.