The Walt Disney Co. and Pixar Animation confirmed today (Tuesday) that they will merge in an all-stock transaction worth about $7.4 billion. Under the deal Pixar shareholders will receive 2.3 Disney shares for each share of Pixar. At Pixar's closing price of $57.57, the deal represents a 3.8 percent premium. Pixar Chairman Steve Jobs, who will join Disney's board, will receive Disney stock worth $3.56 billion. In a statement, Disney CEO Robert Iger said, "The addition of Pixar significantly enhances Disney animation, which is a critical creative engine for driving growth across our businesses. This investment significantly advances our strategic priorities, which include -- first and foremost -- delivering high-quality, compelling creative content to consumers, the application of new technology and global expansion to drive long-term shareholder value." In the same statement, Jobs said, "Disney and Pixar can now collaborate without the barriers that come from two different companies with two different sets of shareholders." But it immediately became clear that Disney's animation division, upon which the company was founded and built, will henceforth be directed by Pixar executives. Pixar President Ed Catmull, the companies said, will become president of the Pixar/Disney animation studios, while Pixar Executive John Lasseter will take on the newly created post of chief creative officer of the division. Nevertheless, both men acknowledged a career debt to Disney. Catmull remarked, "Pixar's culture of collaboration and innovation has its roots in Disney Animation. Our story and production processes are derivatives of the Walt Disney 'school' of animated filmmaking." Lasseter added: "For 20 years we have created our films in the manner inspired by Walt Disney and the great Disney animators -- great stories and characters in an environment made richer by technical advances."

Focus Features' Brokeback Mountain appears to be becoming the sensation abroad that it has become in the U.S. Daily Variety reported today (Tuesday) that the film earned $6.73 million at only 910 theaters, giving it a solid $7,396 per-screen average. In the U.K., the film took in $1.88 in its third week at 275 theaters, for a per-screen average of $6,836. In Spain, the film debuted with $1.6 million at 160 theaters, or $10,000 per screen.

The top ten films over the weekend, according to final figures compiled by Exhibitor Relations (figures in parentheses represent total gross to date): 1. Underworld: Evolution, Sony, $26,857,181, (New); 2. Hoodwinked, Weinstein Co. $10,409,378, 2 Wks. ($28,635,878); 3. Glory Road, Disney, $8,769,735, 2 Wks. ($27,709,549); 4. Last Holiday, Paramount, $8,711,606, 2 Wks. ($25,996,444); 5. Brokeback Mountain, Focus, $7,831,767, 7 Wks. ($42,131,062); 6. The Chronicles Of Narnia: The Lion, the Witch and the Wardrobe, Disney, $6,236,570, 7 Wks. ($271,852,138); 7. Fun With Dick and Jane, Sony, $5,751,700, 5 Wks. ($101,368,957); 8. End of the Spear, Rocky Mountain Pictures, $4,281,388, (New); 9. Hostel, Lions Gate, $4,246,471, 3 Wks. ($42,674,185); 10. King Kong, Universal, $4,222,560, 6 Wks. ($209,875,885).

One day after the London tabloid The Daily Mirror reported that the Roman Catholic Group Opus Dei was considering taking legal action against Sony-Columbia for its negative portrayal of the group in The Da Vinci Code, a spokesman has denied any such intent. As reported by Daily Variety, an Opus Dei spokesman told the Catholic news agency Zenit, "This might interest those who are marketing the movie -- you know, a big fight in public. ... But Opus Dei's only response will be a declaration of peace." (The statement does not appear on Zenit's website.)

Landmark Theaters owner (and Dallas Mavericks owner) Mark Cuban has lashed out at National Association of Theater Owners President John Fithian following Fithian's warning to exhibitors that proposals to release movies in theaters and on DVD on the same date represent a "death threat" to NATO members. Cuban's production company, 2929 Entertainment, is releasing Steven Soderbergh's Bubble simultaneously in theaters, on DVD, and on HDNet Movies on Jan. 27. In a statement posted on his website, Cuban begins by remarking, "How sad is it when the president of the National Association of Theater Owners doesn't think his members can create a better movie-going experience than what we can see in our houses and apartments? Guess what, John, I can whip up a mean steak, but I still like to go to restaurants. Because I enjoy it. I enjoy getting out of the house with family, friends, whoever." Cuban points out that when he took over the Mavericks, he put every game on TV -- and attendance rose. "It didn't take me long to realize that the business of the Mavericks was not selling basketball, it was selling a fun night out." Cuban accuses theater owners of failing to create a similar "fun" experience for their patrons -- particularly older ones. Moreover, he notes, movie theaters currently serve as a platform to create demand for DVDs. "Your problem is that you don't get paid for it." By contrast, he remarks, every theater showing Bubble will receive a percentage of DVD sales.

Warner Home Video announced Monday that it plans to re-release the documentary March of the Penguins on video-on-demand with a special pop-up window feature that will enable viewers to obtain additional text information about what they are watching in the film. The company said that it will be the first time any movie has been released with pop-up technology employed throughout, not just in the bonus material. It said that it is also considering re-releasing the film on DVD using the same technology.

Michael Eisner, who left the Walt Disney Co. as CEO last fall under a cloud of controversy, was honored Monday, as the company's Burbank headquarters building was renamed "Team Disney -- The Michael D Eisner Building." In a statement, Disney Chairman George Mitchell said the board had unanimously agreed to rename the building. "For 21 years, Michael was the leader of the team that reinvigorated this company and put the magic back in Disney, so it is appropriate that this building will now carry his name," Mitchell said.

The Berlin Film Festival announced today (Tuesday) that for the first time it will award a prize for Best First Feature. The winner, to be selected by a three-member international jury, will receive a prize of 25,0000 euros ($31,000). The festival said that the prize money was donated by the Gesellschaft zur Wahrnehmung von Film- und Fernsehrechten (GWFF), a society for safeguarding film and television rights. Thirteen films have been selected for the competition, culled from the regular competition, the Panorama screenings, and the Kinderfilmfest. Somewhat confusingly, the festival said that debut films screening in the Forum section will not be eligible since it already awards its own prize for such films.

In Monday's edition we cited Britain's Independent on Sunday as the source of a story in which Robert Redford discussed rumors of a possible remake of Butch Cassidy and the Sundance Kid. The actual source of the quote was Thursday's edition of Utah's Deseret News, which was not credited in the Independent article. The quote was also published without attribution of any sort in articles appearing on several websites.

There will now be only one "fifth network." In an unexpected announcement CBS Corp. and Warner Bros. Entertainment/Tribune Broadcasting said today (Tuesday) that they will merge UPN and The WB networks into a new broadcast network, the CW Television Network. UPN President Dawn Ostroff will become President of Entertainment of the new network, while John Matta, currently COO of The WB will become its COO. Timing of the merger was not immediately disclosed.

The Winter Olympics in Turin, Italy are not likely to produce the revenue bonanza that NBC had been hoping for, GE Chairman Jeff Immelt has acknowledged. The online MediaDailyNews.com on Monday took note of Immelt's comments during a conference call on Friday that NBC would take in between $650 million and $750 million in revenue. The website observed that NBC had previously said that the Winter Olympics would bring in $900 million. Commented the trade publication: "Now, things look less golden. Even if NBC approaches the high end of Immelt's projections, it may struggle to break even."

Saying that it hopes to "transform fans' couches at home into courtside seats," NBA-TV announced plans Monday to air a special "silent game" in high-definition television, with no announcers (except for the arena's public address announcer) using microphones on the court to "provide fans with enhanced sneaker sounds." The game, between the Orlando Magic and the Houston Rockets, will be televised on Feb. 26 as part of the NBA's Hardwood Classic Nights, featuring a 70's theme. "During any breaks in the action, music with a 70's theme will be featured with a pep band and organist," the NBA's statement said.

NBC's Dateline, which was once called upon to take over the time slots of poorly performing shows when the network gave them the shaft, is itself being shafted. The magazine program, which had already lost its Sunday-night slot when the network decided to go with NFL football on Sunday nights, has now lost its Friday-night slot as well. NBC said it will move Dateline to Saturdays at 8:00 p.m. in March, the lowest-rated night of the week. (Virtually no original entertainment programming airs on the networks on Saturdays.) A TVNewser source at the program called the move "classic Jeff Zucker," referring to the NBC Universal Television Group CEO. "He comes to a Dateline staff meeting THREE months ago and declares his 'full support' to Dateline and says he 'wouldn't be surprised if it went to 3 nights a week' -- and now has sent the show to the graveyard. Our leader is the most insincere guy at the network."

Kagan Research predicted Monday that the market for TV shows on DVD will remain virtually flat over the next few years as producers place more of their archives on Internet video stores for downloading. In a report, Kagan Research estimated worldwide revenue from TV DVD sales will reach a record $2.71 billion this year, then dip slightly to about $2.65 billion in the following five years. However, in an interview for Home Media Retailing, Gord Lacey of TVShowsonDVD.com indicated that the effect of online downloads has been greatly exaggerated, noting that such downloads offer relatively poor quality. "If you ask me, the downloads are a jump back," Lacey said. "Here we are talking about going to HD DVD and Blu-ray, and people are wondering if something half or quarter the resolution is going to threaten the industry?"

NBC has denied numerous reports that popped up on the Internet over the weekend saying that the six stars of Friends had agreed to appear in a reunion special. The reports had claimed that each would be paid $5 million for the special. However, interviewed for Monday's edition of Access Hollywood, NBC Universal chief Jeff Zucker said that there was "not one ounce of truth" to the reports. While he was at it, he also dismissed rumors of a planned NBC sitcom titled It's a Guy Thing that would star David Schwimmer, Matthew Perry and Matt LeBlanc.

ABC is planning to broadcast a new mini-series version of The Ten Commandments in April, just days after its annual showing of Cecil B. DeMille's 1956 classic starring Charlton Heston as Moses. "We think it's a nice thing to run both," ABC Entertainment chief Steve McPherson told the Philadelphia Inquirer. "Some people will watch one or the other, or both." But Robert Halmi, Sr., Chairman of Hallmark Entertainment, who produced the miniseries, told the newspaper, "It's probably overkill to run both, but I have nothing to do with that. The main thing is that mine is first. I am 100 percent sure. Mine is new, so it should be seen first." Not so, said a network spokesperson, Halmi's miniseries will air after DeMille's movie.