Tommy Pickles, the star of "Rugrats," is fond of saying "A baby's gotta do what a baby's gotta do."

The same could be said of Klasky Csupo Inc., the animation studio behind the hit cartoon series on the kids cable network Nickelodeon. Rugrats spawned three Paramount features, which earned nearly $200 million at the box office.

But now, the company is facing some stark realities and is doing what it's got to do. The company has slashed its staff and sold its Sunset Boulevard studio.

The adult-angled "SpongeBob Squarepants" has supplanted "The Rugrats" as Nickelodeon's anchor, and none of other five Klasky Csupo shows once on the network remain in production. Its decade-old deal at Viacom Inc. ends in August.

Arlene Klasky and Gabor Csupo founded the firm as a married couple in 1981. The now-divorced partners the creative minds behind the Nickelodeon hits "As Told By Ginger," "Rocket Power" and "Wild Thornberrys" remain friends. Their plan is to turn their company into an independent feature film studio.

"We're changing our model and are excited for the new things on the horizon," Klasky said. "We're very excited because up until now, we have been exclusive to children's projects, and we are now going out into the world to show our wares."

The transformation won't be easy, particularly in the volatile world of Hollywood film production. With more than 20 feature projects in development, however, they aren't starting from scratch. And with the company's track record of success, they can't be counted out.

Tighter times
The studio has gone from a one-time high of 500 employees to about 80, a downsizing that Klasky said was necessary to enable the company to move forward.

"We have had so much amazing talent come through the door that you wouldn't believe it, but the landscape of animation has changed so much that we really had to change along with it," Klasky said. "Now we want to be a lean animation machine. From an economic standpoint, we had to change with the times, become a little more practical."

The new approach was necessitated by a change in the overall animation marketplace.

To cut costs, many outfits, including Nickelodeon, developed their own animation studios or outsourced work overseas. That made talent-heavy operations such as Klasky Csupo an expensive option.

This month the company sold its Sunset Boulevard home to the owners of the Los Angeles Film School and the Los Angeles Recording School, which bought the 100,000-square-foot building for $40 million, or about $400 per foot. Klasky Csupo will lease back the top two floors of the building and keep its operation there. The firm that runs the two schools, Full Sail Real World Education, plans to house them in the building.


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