Toy Story 3: According to Reuters, Walt Disney Co. studio chief Dick Cook said on Friday he was leaning toward making the third installment of "Toy Story," Pixar Animation Studios Inc. 's 1995 hit, as a feature movie rather than a straight-to-home video project in a few years.

Pixar and Disney plan to part ways after two more films together, but Disney retains the rights to make the sequels to the movies they have already produced, including the two "Toy Story" movies.

Pixar, which has said sequel rights were a sore point that helped torpedo contract extension talks, could take part in "Toy Story 3" but has said it was unlikely to do so.

"My hunch is big screen," Dick Cook, the studio chairman, told Reuters in an interview. But he said that no decision had been made and that the movie was a few years or more away.

"We are nowhere on it right now," he said.

Disney's sequel to its own hit "The Lion King" went straight to video and DVD this year. DVD sequels work well for studios that can build on a household name without major investments, but Cook said the "Toy Story" sequel was worth a bigger release.

"I think it deserves it. These are two of the most beloved characters in the last generation. Buzz and Woody are fantastic characters, and I think that is something that would fit on the big screen nicely."