And the "Treasure Planet" debacle comes as the animation division is in a state of flux.

For the first time in recent memory the animation division has no hand-drawn movies in the production pipeline.

The decision to spin off the animation division is driven by the diverging interests of the three founders.

Warner Bros shut down its original animation division in early 2008.

The animation division has been producing the most revenue within the movie studio.

At the same time, Disney's animation division has undertaken its own economy drive.

Mr. Schneider rejected recent criticisms that the company's animation division had lost its creative spark.

Last year 20th Century Fox closed its traditional animation division.

There are now about 1,500 workers in the animation division.

Many film studios, including Disney, bolstered their animation divisions in the mid-1990's, which failed to pay off significantly for most.