THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
THIS IS A RUSH TRANSCRIPT. THIS COPY MAY NOT BE IN ITS FINAL FORM AND MAY BE UPDATED.
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UNIDENTIFIED FEMALE: It's a time machine!
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SUSAN LISOVICZ, HOST: Ahead on BUSINESS UNUSUAL, an animation studio draws on fresh talent in a scale economy. Something fishy hits the auction block in Maine. And a veteran journalist gives his take on the future of flight. That's all ahead on BUSINESS UNUSUAL.
Hello, and welcome to BUSINESS UNUSUAL. I'm Susan Lisovicz.
The name Klasky Csupo may not ring a bell. But "Rugrats" should. It just may be the most watched children's cartoon in the world. Not only that, the show just celebrated its tenth anniversary. Klasky Csupo is the largest independent animation studio in the world and the brains behind the "Rugrats."
Gayla Hope caught up with the CEO Terry Thoren and co-founder Gabor Csupo for an inside look at this history making company.
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TERRY THOREN, FOUNDER, WORLD ANIMATION CELEBRATION: Excuse me.
GAYLA HOPE, CNN CORRESPONDENT (voice-over): Terry Thoren is wearing several hats today. He is the CEO of Klasky Csupo's animation studio.
THOREN: We are the United Nations of animation.
HOPE: The organizer of today's World Animation Celebration, and the owner and publisher of "Animation" magazine, now in its fifteenth year of publication.
Thoren has been organizing the World Animation Celebration every other year for the past 20 years.
THOREN: Even though we're called the World Animation Celebration, it's always been a festival of opportunities. It's a lot more convenient to come here and do business room to room than it is to drive around Los Angeles or to fly to Portland or Seattle or to Hong Kong or to Korea.
HOPE: This year, Thoren took over the Roosevelt Hotel in Hollywood, where companies set up shop around the pool to show off new products, hopefully pull in new business, and make new contacts.
THOREN: It's actually more direct.
HOPE: There are also hourly seminars going on inside the hotel.
Terry Thoren is known as the ambassador of animation because of his connections in and knowledge of the business. That made him the perfect candidate in 1994 to take over as CEO at Klasky Csupo.
THOREN: Klasky Csupo started off as a commercial division and making commercials, making titles and trailers 20 years ago. Then, with the success of "The Simpsons," our core business became television.
When I joined the company, we decided we also wanted to become a movie company. Well, I was like a kid in a candy shop. Here are the geniuses who have surrounded themselves with the geniuses from all over the world. And they're creating some of the best characters I could ever imagine being involved with.
I've always been a big promoter of animation. What they needed was someone to facilitate the process, help the company develop a long-range plan.
HOPE: Thoren helped expand the independent company, beefing up the commercial division and adding two music labels piloted by Gabor Csupo. He recruited more artists and found a new building to house the expanded Klasky Csupo team that grew from 38 to nearly 500.
CRAIG BARTLETT, EXECUTIVE PRODUCER, NICKELODEON: Klasky Csupo now is a huge company on Sunset and Vine with a giant building. It's sort of like some kind of huge kind of Hollywood success story.
MICHAEL WAHL, CEO, FOUNDATION IMAGING: Klasky Csupo is probably the most influential cell animation studio in the '90s. They transformed the way viewers look at programming, the way producers think about programming, and the way broadcasters consider what is appropriate for kids to watch.
Every decade has a look and a feel. We had Hanna-Barbera. We had Marvel. Now we really have the age of Klasky Csupo.
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CHILDREN: Happy birthday!
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WAHL: It was Gabor Csupo and their design team that came up with the color palette for "The Simpsons." At that time, they were thinking about doing "The Simpsons" in black and white. And Gabor convinced them to use the blue hair and the yellow skin. HOPE: Klasky Csupo did the animation for "The Simpsons" first three seasons. That was the turning point.
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UNIDENTIFIED MALE: I've got an idea. Follow me.
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HOPE: In 1991, Klasky Csupo's own show "Rugrats" premiered on Nickelodeon, stories about life as seen through the eyes of crawling babies viewed at carpet level.
THOREN: The "Rugrats" is the most watched show for children in the world today.
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UNIDENTIFIED MALE (speaking in foreign language)
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HOPE: The show just celebrated its tenth year. And Klasky Csupo's "Rugrats" received a star on Hollywood's Walk of Fame in June.
THOREN: Television and movies are about 40-40. And the other businesses are 20 percent.
HOPE: Thoren says they want to flex their muscles in other areas and are forming a new production company called Global Tantrum. Programming will be for 18-to-35-year-olds.
(on camera): In a business environment where many companies are slowing down or even laying off, Klasky Csupo is flourishing.
THOREN: There's a great -- an audience out there that's hungry for our content. They are looking for something different.
HOPE (voice-over): Another Klasky Csupo production, "The Wild Thornberries," is second in the ratings after "Rugrats" on Nickelodeon. Eliza (ph) travels with her parents in a motor home and is able to speak with animals.
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UNIDENTIFIED MALE: Killer block, dude.
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HOPE: "Rocket Power" is relatively new, along with a wave of other programming, including "As Told By Ginger."
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UNIDENTIFIED FEMALE: You know how I feel about Ian.
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HOPE: A young adolescent girl experiencing the realities of growing up. If you work at Klasky Csupo, however, you don't necessarily have to grow up.
THOREN: You loved high school and you had a great high school experience. You loved gym. You loved walking down the hall and seeing your friends. You loved lunch. And you loved certain subjects. Klasky Csupo, we run it like high school or college, the college campus.
UNIDENTIFIED MALE: They sure have good food at Food Favors (ph).
(LAUGHTER)
THOREN: I think Klasky and Gabor Csupo are incredible artists. And they have a particular vision for creating content that was unique to the entire world. And my job is to create a cocoon for the creative process.
GABOR CSUPO, CO-FOUNDER, KLASKY CSUPO: We wanted to do something more out there, more daring, more strange, more bizarre, just more fresh. And we believe that the kids will recognize that and understand it and accept it. We do a little bit more alternative, a little more -- you might call it hipper or fresher or newer and less traditional.
You know, no less than 10, 15 years, we always feel like any given day we're just so busy. You can't get comfortable with that. You always have to think ahead a couple of years and push it, and develop new shows, and just keep going.
HOPE: Gabor Csupo knows how important it is to keep going. He escaped from Hungary during 1975 during Communist rule through a seven-mile train tunnel leading into Austria.
CSUPO: People saying that this is the land of opportunities, I think this truly is. You just have to believe in what you're doing and go for it and just keep doing it because when I came over here, I had 500 vinyl LPs and maybe $30 in my pocket. And I just said, "OK, I'm here. Let's sit down and keep drawing."
And I enjoyed it. I didn't care if I had no money to eat. I loved it. I loved the freedom. And you only see this really when you come from another country where you grew up and there was like a lot of restraints in the system. And all that counts, you have no possibilities.
HOPE: Today, the possibilities are endless. Klasky Csupo's recipe for success: good writing, character design, music, and voice casting.
UNIDENTIFIED FEMALE: But there's nowhere to run, nowhere to hide! We're trapped in the closet of doom!
UNIDENTIFIED FEMALE: We're not trapped, you guys! And this isn't no closet. It's a time machine!
HOPE: For BUSINESS UNUSUAL, Gayla Hope, CNN Financial News, Hollywood.
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LISOVICZ: Even though Klasky Csupo isn't exactly a household name, the company is well known within the industry. Klasky Csupo has received four Emmys, two for "The Simpsons" and two for "Rugrats." They're up for another two this year for "Rugrats" and "Ginger."
Ahead on BUSINESS UNUSUAL, a house on Maine, fishermen and fish dealers are bidding on their financial future. A look at the Portland Fish Exchange when we return.
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LISOVICZ: For 10,000 people on the coast of Maine, fishing is a small business that floats, supporting families and communities. Until recent years, many commercial fishermen were at the mercy of local dealers, who would give them a price. And low, high, or fair, that would be the end of it.
Today, the large fishing ports are discovering auctions to set the market value for the fish. Peter Viles takes a look a the sights and sounds of the Portland Fish Exchange.
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PETER VILES, CNN CORRESPONDENT (voice-over): Fishing for a living. It is a mysterious business.
UNIDENTIFIED FEMALE: Sometimes you catch them. And sometimes you don't.
UNIDENTIFIED MALE: You can go out and work very hard and endure a lot of hard weather. And if the price is low when you get in, then you don't get a lot of money for it.
VILES: After centuries of innovation, no one can be sure if the fish will bite, how bad the weather will be. Perhaps the most excruciating mystery of all, what price will the catch bring?
UNIDENTIFIED MALE: Welcome to the Portland Fish Exchange Auction. Anybody bid 20 and one, two, 20 and three, four...
VILES: Portland Fish Exchange was designed 15 years ago by fishermen to take some of the mystery out of the pricing.
UNIDENTIFIED MALE: Sold 125 to 58.
VILES: The auction itself, which is not for profit, brings buyers and reps from restaurants, supermarkets, and processors all over the country. It is the first of its kind in the U.S.
HANK SOULE, MANAGER OF FISHING VESSELS: I think it is far and away the best way for fishing vessels to sell their fish, by selling it on auction as opposed to selling it to private dealers.
SCOTT EATON, CAPTAIN, THE PAULO MAIN: If you go to any one certain fish dealer like any certain dock in particular, then they basically can do what they want to do.
Right here it's a pretty open market just like at an auction house. That's what it is. It's an auction for the fish. The high price gets the bid.
VILES: By 6:00 a.m., several boats have already come in to unload. Buckets seem to catch up from the hold where it is sorted by species and weighed and finally brought into a chilly 38-degree warehouse and identified according to fishing boat. Services are impartial and are provided by the Fish Exchange. Both the buyers and the sellers pay a fee.
It is an open display auction. So the best looking fish demand the highest prices. Former fisherman Bill Gerencer is usually the first buyer on the scene.
BILL GERENCER, BUYER, MLF FOLEY: We have a lot of brand new fish in here today. So all these fish, you see the cut surface, it looks like it's just been cut. And inside the belly, the blood is still nice and red and the skin is shiny. And when I put my fingers in, it pops right back out. So there's a lot of life left in the fish. And shelf life is flavor.
VILES: Bill Gerencer's daily ritual is a triple pass through 100,000 pounds of fish and slime. He pokes and sniffs because fresh fish, he says, has no odor.
GERENCER: I try to look at my fish three times because I'm kind of nervous that way. But that way, I don't make any mistakes because once you buy the fish here, because it's a display auction, you own it. Once the auctioneer says "sale," there's no recourse. You're stuck with it. And I don't have homes for second quality fish.
VILES: Gerencer represents finicky clients across the country, hotels like the Ritz Carlton chain and restaurants in New York City.
GERENCER: We're kind of a niche company. But there will be companies in here that are buying for the Safeways, the Shop-and- Saves, the bigger chains like Red Lobster and places like that. There's home for all this stuff. And all of it goes to different parts of the market.
VILES: The exchange has had its ups and down along with the increasing and declining catches. Fish sold through the exchange brought $27.5 million in 2000, up from $22 million in 1999. But marine experts say regulation is finally paying off and that fisheries are finally coming back.
PAUL DEWEY, AUCTIONEER: When they first started here, 350, 400 pounds of haddock in a week would be a good week. Now we've had weeks where we've had 20,000 and 30,000 pounds of haddock. The government has closed off certain latitude and longitude areas for fishing. It's really working out fine.
Large gray sole, 158 pounds, a couple of bucks and five...
VILES: Paul Dewey, an ex-cop, loves his job. And both fishermen and buyers trust him.
SOULE: He knows everybody at that auction inside and out. He understands how fish auctions work. He understands the desires of his buyers and sellers. I can't imagine a better auctioneer than Paul Dewey, and that includes computers. A computer is never going to be like him.
UNIDENTIFIED MALE: Sold 63 to 37.
VILES: The exchange is experimenting with electronic bidding. Buyers bid by remote control. So Dewey knows that his days are numbered.
DEWEY: As long as I feel good, I can do this for the rest of my life, however long that is. As Clint Eastwood said, a man should know his limitations.
No sale, lane two, at 67.
VILES: Sometimes the bidding is too low. Hank Soule, one of the fishermen's reps, calls it and decides to sell the fish elsewhere for a better price.
SOULE: We generally refuse prices or decline prices almost every day. It happens. Some days it will be maybe 100 pounds. Some days it will be 20,000. But like many of the days, I'm not ecstatic with the prices I receive here. But considering the overall marketplace, the supply-and-demand picture that I see out there, I'm very satisfied with the prices I saw here today. I don't have a problem.
VILES: For BUSINESS UNUSUAL, I'm Peter Viles, CNN Financial News.
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LISOVICZ: Despite the overall quest for organization and fairness at the fish exchange, some fishermen argue that they still don't get good prices for the fish that they've risked their lives to catch. And some don't agree that regulation is the reason for improvement in fisheries. But most agree that selling by auction is the fairest way to sell their catches.
Still to come, from the unpredictable sea to the troubled sky, what the future may hold for the turbulent airline industry. A veteran journalist gives us his take when we return.
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LISOVICZ: The airline industry has hit some turbulence recently. The big players are trying to rise above these tough times, many by slashing prices this week. But our next guest says the bumpy ride is only beginning for the major airlines and that the small plane industry is where the future of the business lies.
Joining me now from our Washington studio to explain is James Fallows, national correspondent for "The Atlantic Monthly" and author of the new book "Free Flight: From Airline Hell to a New Age of Travel." Welcome
JAMES FALLOWS, AUTHOR, "FREE FLIGHT": Thank you.
LISOVICZ: And I guess the title really says it all. The premise of the book is that the fate of commercial air travel right now is a disaster for the consumer.
FALLOWS: It is. It's good in two ways. The airlines are amazingly safe. It's about the safest thing you can do is to be on a U.S. airliner. And they are, on average, cheaper and cheaper, compared to days before deregulation. The seat price is about 30 percent lower than it used to be.
But in terms of convenience, in terms even of speed, the airline performance is going down. As the system that becomes more and more congested, anything that goes wrong in one place ripples through the whole system. So it's reaching a kind of breaking point.
LISOVICZ: And it's really because of deregulation, because of that hub system. I think you used the example that the average 500- mile air trip by commercial airlines would be just as quick to drive there.
FALLOWS: NASA did some amazing studies. They found, number one, that over the last five years, for the first time in modern history, the speed of high-speed travel has been getting slower. In the last five years, it's gotten slower and slower and slower to go on airlines because of the congestion.
Second, they found that because of all the various inefficiencies that go with today's air travel -- getting to the airport, changing planes, the ripple effects, et cetera -- on average, a trip of less than 500 miles is faster by car on a door-to-door basis than it is on airlines.
LISOVICZ: And so NASA is actually a good segue because NASA has been working on a revolutionary new way of travel for the last 20 years. That was unbeknownst to me for sure. And it really does involve something like air taxis.
FALLOWS: In a way, what NASA has had in mind, which they've been doing very skillfully in stealth mode with almost no publicity for a dozen years, is essentially bringing the corporate jet vision to a much broader section of America. What's great about corporate jets, what's great about the CEOs who can use them, is you can go on your own schedule from the place you want to start to the place you want to go without going through O'Hare or DFW or these other places.
And NASA has been involved with a number of these innovative startup companies in trying to produce essentially things like corporate jets -- small, fast, comfortable jet-powered planes, for about one-tenth the price of today's prevailing corporate jets. And the idea of that is not that you or I would buy a little jet and fly it, but an air taxi service would be available to us to have an alternative to going through the Hudson (ph) folks.
LISOVICZ: It sounds fantastic. But when I think of small airplanes, unfortunately, I think of what happened with Aaliyah in the Bahamas just earlier this week. I think of John F. Kennedy, Jr. piloting his plane to Martha's Vineyard. The fatality rate, the danger rate, is greatly increased with small aircraft, isn't it?
FALLOWS: It certainly is true that smaller planes are less safe than big planes. I say this as somebody who likes flying and has for a number of years.
The crucial difference in small plane safety is whether the propulsion is piston-powered propeller planes or turbine powered jet planes. Jet planes are much more reliable. They're much faster. And they get above, get around the troublesome weather.
So the crucial part of NASA's vision has been saying these planes have become -- have to be and to seem much safer than they are now. And the real breakthrough for that is having jet planes that are inexpensive.
And so there have been a number of developments by a number of small companies that I talk about in this book that have finally come up with these inexpensive light jet engines that can broaden the appeal, the reach, of jet travel.
LISOVICZ: And one of the examples is a small plane that actually has a parachute for the entire aircraft.
FALLOWS: This is marvelous little plane, which I've spent many, many hours flying. It was invented by a pair of brothers in northern Minnesota. One of them, when he was a young man, a young pilot, was in a midair collision that he barely survived.
His conclusion from that was not to stop flying, but that when he and his brother built an airplane, it would have a parachute for the entire plane. It's something called a Cirrus SR-20 (ph). If you have a John Kennedy-type episode in that, there's a handle you pull, a parachute pops out, and the whole plane comes down to a safe landing.
LISOVICZ: And this whole new way of travel, which you envision, which NASA has outlined, where do the major airlines stand in all of this, the Deltas, the Continentals of the world?
FALLOWS: Well, it's fascinating. I can see them taking -- one of the high roads for them to take is say, yes, this is part of the service that we should offer our customers. They want to travel. We're not doing a perfect job. Let's offer them some more of this small point-to-point travel from one small airport to the next.
You could also imagine them taking a low-road strategy and just trying to bad-mouth these people and regulate them out of existence. Or you can imagine them ignoring them too and being sort of overtaken as GM was in the 1970s.
I would hope they will take the high-road strategy of thinking that operating smaller planes and having a more flexible way is how they can keep some of their most attractive customers, the ones who are deserting them right now in their hard times.
LISOVICZ: Your book is fascinating. Jim Fallows, the author of "Free Flight: From Airline Hell to a New Age of Travel." Fascinating. Thanks for joining us.
FALLOWS: My pleasure. Thank you.
LISOVICZ: And BUSINESS UNUSUAL will be right back. Stay with us.
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LISOVICZ: And that's BUSINESS UNUSUAL. Coming up next week, breathing new life into a faded brand new. Turnaround specialist Rosemarie Bravo (ph) is taking Burberry (ph) out of the trenches and onto the runway. Look at her plan of attack next week on BUSINESS UNUSUAL.
And if you missed any of today's program, you can catch it on the web. Just go to CNNfn.com/BUSINESSUNUSUAL. And be sure to tune into BUSINESS UNUSUAL's daily show each weeknight at 7:00 p.m. Eastern time on CNNfn.
I'm Susan Lisovicz. Thanks for joining us. Goodbye from New York.
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