Throughout the 1920s, Fleischer was one of the top producers of animation, with clever humor and numerous innovations including the Rotograph, an early photographic process for compositing animation with live action backgrounds. Other innovations included Ko-Ko Song Car-Tunes, sing-along shorts (featuring the famous "bouncing ball"), which were a sort of precursor to Karaoke. From May 1924 to September 1926, the studio used Dr. Lee De Forest's Phonofilm sound-on-film process to produce 19 early cartoons with synchronized sound tracks, including Come Take a Trip in My Airship, Darling Nelly Gray, Has Anybody Here Seen Kelly and By the Light of the Silvery Moon. The Ko-Ko Song Car-Tunes series ended in 1927, but returned as the Screen Songs series from 1929 to 1938.
The studio's initial successes began to turn as the 1930s continued. In 1934, the Hays Code was enacted in Hollywood, which resluted in severe censorship for films. Betty's sexuality was neutralized, and much of her charm was lost. At the same time, the Hays Code affected the tone of Paramount's films. Paramount had also gone there three reorganizations from bankruptcy between 1931 and 1936. And the new management set out to make more general audience films of the type made at MGM, but for lower budgets. This change in content policy affected the content of cartoons that Fleischer was to produce for Paramount, who was urging Fleischer to consider emulating the Walt Disney's cartoons. The most notable example of the Fleischers' adaptation of the Disney style was their Color Classics series, which was essentially a copy of Disney's Silly Symphonies.
The Fleischers' success was further solidified when they licensed E.C. Segar's comic strip character Popeye the Sailor for a cartoon series of his own. Popeye eventually became the most popular series the Fleischers ever produced, and its success rivaled that of Walt Disney's Mickey Mouse cartoons. Three Technicolor Popeye featurettes were produced in 1936, 1937, and 1939, and were billed in many theatres alongside with or above the main feature.
Upon its Christmas 1939 release, Gulliver performed modestly, although the quality of the story and animation was far behind that of the film it tried to emulate, Snow White. Between the release of Gulliver and the follow-up feature Mr. Bug Goes to Town (1941), the Fleischers produced their best work from this period, a series of high quality shorts based upon the comic book superhero Superman. The first short in the series, simply titled Superman, had a budget of $50,000, the highest ever for a Fleischer theatrical short, and was nominated for an Academy Award.
However, this late success did not help the studio lift its financial trouble. The expanded staff of the new Miami studio created a high overhead, necessitating steady production. A number of the shorts turned out during this period, such as the continuing Popeye shorts and a 1941 two-reel adaptation of Raggedy Ann and Andy, maintained a high level of quality. Others, like the Stone Age shorts, and the various Gulliver spin-off series, were among the studio's least successful output.
Mr. Bug Goes to Town was finally released on December 5, 1941. Unfortunately, its release fell just two days before the bombing of Pearl Harbor, which brought The United States into World War II. Mr. Bug failed to get a general release, and while it was made within its $500,000 budget, its costs could not be recouped. Dave Fleischer, no longer able to cooperate with brother Max, left the studio at that time to become the head of Columbia's Screen Gems animation studio in California one month premature of the expiration of his Paramount contract. With the co-owner of their animation studio now working for a competitor, Paramount cited a "breach" of contract and produced the letters of resignation, calling their loan, which bankrupted Fleischer Studios, Inc. As a result, the Fleischers were removed from control of the studio and Paramount formed a new company, Famous Studios, as a successor to Fleischer Studios in mid-1942.
Max Fleischer went on to become Head of the Animation Division of the Jam Handy Organization, and Sam Buchwald, Isadore Sparber, Dan Gordon, and Max Fleischer's son-in-law Seymour Kneitel became the new heads of Famous Studios, which was moved back to New York by 1943. The Fleischers were never a major force in the industry again, but their films and characters have remained popular. By the 1980s, the Fleischers were recognized as the animation pioneers that they really were. Fleischer Studios is today an in-name-only company, handling the merchandise licensing of Betty Boop.
The issue of rights to the Fleischer/Famous Studios cartoon library is complicated. With the exception of the Superman (sold to Motion Pictures for Television, which produced the 1950s Superman TV series) and Popeye cartoons, Paramount's cartoon library was originally sold to a company called U.M.&M. T.V. Corp. (which later became National Telefilm Associates [NTA] and Republic Pictures). U.M.&M. (as well as its NTA successor) altered the original negatives to a majority of the cartoons and modified their original front-and-end credit sequences, either blocking out all references to Paramount or creating new but cheaply done credits.
In 1958, the 1950–1958 cartoons were sold to Harvey Comics, which also bought the 1958–1962 cartoons as well (today they are owned by Classic Media). The copyright for most of the Fleischers' cartoons was not renewed by Famous or Paramount, and entered the public domain. This included the Color Classics series, the Betty Boop series, the Superman series, and Gulliver's Travels. (Mr. Bug Goes to Town and some cartoons of Popeye are renewed and till copyrighted.) Most (and initially, all) cartoons of the Popeye series did not become public domain as Popeye's trademark was enforced by King Features Syndicate and the cartoons themselves acquired by Associated Artists Productions (a.a.p., which later became part of United Artists), including the three public domain two-reel Popeye Color Specials (Popeye the Sailor Meets Sindbad the Sailor, Popeye the Sailor Meets Ali Baba's Forty Thieves, and Aladdin and His Wonderful Lamp).
Most of the Fleischers' color public domain films have been widely available on video since the 1980s, often on inexpensive (and poor quality) videotapes sold in supermarkets and department stores as parts of collections of other public-domain cartoons. Both animation fans and the UCLA Film and Television Archive have worked to give the classic Fleischer cartoons the credit they deserve, and high-quality restored editions of the Fleischer cartoons have also been made available on pay-cable, home video and DVD. Many of these restored prints include the original front-and-end Paramount titles.
Roughly half of the entries in the Betty Boop series, and most of those in the Out of the Inkwell/Inkwell Imps series have also entered the public domain, though they are not as widely available because of the popular belief among today's video producers that black-and-white and silent cartoons in general do not appeal to young children. Some of these cartoons have also appeared in restored versions (mostly with their original credits).
The Superman and Popeye series, in one way or another, ended up under the ownership of Warner Bros. Entertainment via its various subsidiaries. DC Comics (acquired by Warners in the late 1960s) now owns the original film elements to the Superman series, while Turner Entertainment (acquired by Warners current parent Time Warner in 1996) owns the Popeye series outright (with the exception, of course, of the later produced 1960s made-for-TV shorts which are owned by King Features Entertainment).
Meanwhile, Paramount (through Republic, which the studio's parent company, Viacom, acquired in 1999), in a twist of irony, now owns the original elements to its 1927–1950 output they themselves originally released (in addition to the 1962–1967 shorts they have retained the rights to). Paramount now also owns the theatrical rights, while Republic's video licensee, Lions Gate Home Entertainment, holds the home video rights, and what is now CBS Paramount Television now holds most major TV rights (aside from other major and minor/low budget film, TV, and video companies that distribute the public domain cartoons). Although there were official releases in the late 1980s of Betty Boop compilation VHS and LaserDisc box sets by Live Entertainment (Lions Gate's predecessor), and select Superman cartoons by Warner Home Video (as part of separate VHS and LaserDisc collections of episodes from The Adventures of Superman TV series of the 1950s), it would take longer for any official DVD releases of the Fleischer cartoons due to Republic's ownership and video license changes, the potential film and/or digital restoration costs, and the financial viability as the result of releasing restored versions.
There have been some notable video releases for the Superman series, among the best reviewed of these was a 1991 VHS set produced by Bosko Video, titled The Complete Superman Collection: Golden Anniversary Edition - The Paramount Cartoon Classics of Max & Dave Fleischer released as two volumes which featured high-quality transfers from 35mm prints. At least two separate versions of the Superman series was released on DVD, both of which feature all 17 original episodes: The Complete Superman Cartoons — Diamond Anniversary Edition (released in 2000 by Image Entertainment, this DVD was a re-issue of the Bosko Video tape set) and Superman Adventures (released in 2004 by Platinum Disc Corporation)--a third (and more "official") compilation using restored and remastered materials was released in November, 2006 by Warner Home Video as part of their DVD box set of Superman films; and VCI Entertainment/Kit Parker Films' DVD compilation of all the Color Classics entitled Somewhere In Dreamland, which includes only a fraction of shorts remastered from 35MM, but otherwise taken from the best available sources Kit Parker could provide VCI, and digitally recreating the original front-and-end Paramount titles. (Animation archivist Jerry Beck served as consultant for this box set, as well as providing audio commentary for select shorts.)