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Green Scream: The Decay of the Hollywood Special Effects Industry

• dmm 14y ago
  Is is the role of govt to prop up business models that are failing? There is no "right to profit". Failure is a vital part of the market. Failure is the market saying, "This capital can be used more effectively somewhere else." Failure is _not_ bad. It may be painful but it's necessary. Think about it, should the govt subsidize every startup so that none fail?
  • eurleif 14y ago
    >The studio was the latest casualty of a trend that’s been plaguing the VFX industry in recent years: an outflow of work to countries with better tax incentives Seems like the failures aren't just caused by the free market.
    • ollysb 14y ago
      Surely this is a case book example of the free market in action.
      • eurleif 14y ago
        How is something caused by government intervention an example of the free market in action?
        • vy8vWJlco 14y ago
          The parts that are still free to do so, like nodes on the Internet, route around them. (Or, if you prefer, "avoid them like the plague.")
        • ef4 14y ago
          One can argue that tax jurisdictions compete with each other in a market. Which is a good thing, as it helps put an upper bound on how aggressive a jurisdiction can get before capital starts fleeing. But of course this picture is missing one of the key mechanisms of a truly free market -- there's no market pricing of the market participants themselves. You can't buy out a government that's acting foolishly.
          • cdtwigg 14y ago
            It's a refundable credit, meaning that the government will reimburse the company for VFX work above and beyond its tax liabilities. How is this "tax jurisdictions competing" and not a direct government subsidy? http://www.bcfm.ca/faq/#pstc4 http://www.bcfm.ca/faq/#pstc4
            • ef4 14y ago
              I think that's a distinction without a difference. Whether the government taxes you less, pays you directly, or puts tariffs on your foreign competitors, it all amounts to a subsidy in the end. (And I don't disagree that it's a foolish idea.)
  • Jare 14y ago
    Govt subsidies are (in theory) an investment; you invest money in X so that you can make more money (or value) from Y. In that sense, for example, there's a train of thought that if creating VFX in the USA becomes untenable then its move to other countries may drag money with it, then know how, then creative talent, then innovation, then production, then the entire industry and then it associated power for cultural dominance. The entire sequence can be debated and argued and nitpicked to death (and I don't know enough about it to even try), but the underlying idea is valid.
    • talmand 14y ago
      They are in theory an investment, more often they turn into huge wastes of money and cripple the industry they are supposed to help.
    • ef4 14y ago
      Even the underlying idea (essentially mercantilism) is questionable. While it can clearly benefit certain special interests (hence its popularity), it simply cannot benefit a whole society on net. Rather than repeat the whole argument, I'll just cite Adam Smith (a guy who was much more moderate than often portrayed by modern partisans), who showed in no uncertain terms that subsidies and tariffs make a nation poorer.
  • tzs 14y ago
    Did you read the article? Your response seems to be an all purpose response ignoring the specific circumstances that distinguish this specific case the general case.
• raverbashing 14y ago
  What is funny is that VFX costs have been going DOWN Today, I can do professional VFX in a "cheap" computer (of course, you want to shoot for the high end), together with software easily acquirable. Compare that to the beginnings of ILM for example. This smells much more of bad business plans + companies tolerating studio's abuse (payment delays, overstaffing to meet deadlines, etc) " In order to compete, VFX houses in Southern California have to charge way less, leading to slim-to-none profit margins" Aah there you go. The absurd of housing prices (and everything) in California. Like you need to be close to your customer in this times of internet and FedEx, you can set shop in Seattle maybe and cut your costs
  • berkut 14y ago
    It's artist time that is expensive - even render time is cheap in comparison. VFX houses are happy to spend loads of money on renderfarms and wait 12 hours a frame, but it's mainly artist time that costs money. Software cost only has a small influence in the general picture, although the Indian and Chinese VFX companies using unlicensed software gives them even more of an edge than cheap labour by itself does.
    • raverbashing 14y ago
      Yes, the cost of keeping HW up to date is non-negligible, even if it is a small part of the costs. That 12h per frame has remained more or less constant for the past years, they'd rather have more details than speed it up =) (I suppose modern hardware can render Toy Story today in real time and even more) But the cost of artists reflect the cost of where they live, pick a less expensive city in the US and you can probably match UK/New Zealand Of course, it can't be NullPointer, Wyoming but in a bigger area it shouldn't be a problem
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      • berkut 14y ago
        A lot of the more mundane stuff is already "outsourced" or given to VFX houses' offices in other parts of the world like India. e.g. SPI send all their Roto to India, they've just moved all their comping and lighting to Vancouver, it's mainly just R&D that's in Culver City now. That's probably going to happen more and more now - instead of having dedicated Roto departments, it'll be outsourced as a way to cut costs.
• mindslight 14y ago
  From what I've been hearing about DD, the problem is terrible management more than anything. The outsourcing looks financially attractive on paper but doesn't actually get the job done (the last 10% taking 90% of the time and all that. sound familiar?), leaving Venice to pick up the pieces after the show is already late and over budget.
  • berkut 14y ago
    But that's inherently a problem with feature film (and especially animation stuff) - even the studios like FOX and Disney only get the profit once DVDs and merchandise have been selling - before then, they've given out millions to finance the production. DD were pretty stupid trying to do the feature animation thing, and changing their company name a few times has caused them even more financial trouble in terms of having to buy software multiple times for site licenses.
    • mindslight 14y ago
      What's inherently a problem, bad management? :P There's always uncertainty that any subcontractor might be just saying they're making progress, only to blow up at the end. But this shouldn't be happening internal to the company. Hadn't heard that about the software licenses! I thought the naming shenanigans were only the holding company, are you sure that wasn't just from adding licenses for Florida?
      • berkut 14y ago
        Fair point, yeah it's internal with them, I hadn't thought of that. Put it this way - they've bought Nuke three times, and they made it originally!
• doctorpangloss 14y ago
  I'm surprised everyone took the economics angle to criticize VFX houses. There was a time not long ago when Computer Science looked stupid because a programmer in India could do the same software engineering work for 1/3 the pay. I doubt free-market thinking programmers came out of the woodwork to applaud cheap Indian labor. Besides, as other commenters noted, what is outrageous economically speaking is the $400 million B.C. handout, not cheap labor. That doesn't sound like free market to me. I think VFX artists just need to unionize. They have the same "real" problem software engineers do, which is this pretentious notion of artist. Like software engineers, VFX artists aren't professionals or artists. They are given bulk work that requires technical expertise to execute, like a welder, a makeup artist, or a teacher (my grin, it is huge). To drive home the point, an HN software engineer commenter complained that at the same point in his and his doctor friend's career (about 7 years), the doctor was earning radically more money. Lawyers too, I might add, being real professionals, earn what VFX and software engineers expect to be earning. Nevermind consultants and their enormous bonuses. A Blackstone consultant can retire at 30, even though your average software engineer or VFX artist could dismiss what the consultant does as "making PowerPoints." The artists line shows how out of touch VFX artists are with their role in Hollywood. If VFX artists want to take more ownership, creative and financial, direct features. Don't hire actors. Distribute yourself. It happens, like Neill Blomkamp. You don't have to start Pixar.
  • potatolicious 14y ago
    > "I think VFX artists just need to unionize." This will never happen, for the same reason the video game industry will never unionize. It's a glamour industry where there is absolutely no shortage of starry-eyed dreamers who've been sold more on the ideal of the craft than the reality. It's hard to unionize when there's a lineup of naive dreamers stretching all the way around the block, all ready to pounce into your seat at the first opportunity.
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    • patmcguire 14y ago
• pwthornton 14y ago
  I wonder if the constant shifting of VFX houses to new countries and employees coming and going from the field is why we are seeing uneven results in movies? Most special effects-laden movies have a few CGI shots that just look awful. And you would think that VFX would be steadily improving in quality, but while we often see more impressive results in terms of what can be done the accuracy of them isn't always holding up and the realism and reliability isn't improving at the same rate that technology and new techniques are. This could end up with Hollywood shooting themselves in the foot. Movies are getting more and more CGI, but CGI that breaks the suspension of disbelief can really ruin a movie. A lot of people complained about the VFX in Wolverine, for instance, but shouldn't the VFX in that have been better than the X-men triology? Well, when you have seventeen different companies doing VFX shots for a movie, you're going to get uneven results. There was some really good VFX in Wolverine, but there was some really bad stuff too, and I'd have to believe the studio going cheap is what led to it.
  • MrScruff 14y ago
    That's mostly a function of the studios drastically reducing the amount of time given to produce the work, while simultaneously increasing the complexity. It's fair to say that not all vfx facilities produce the same quality of work. That's a function of many things, but primarily if the facility can charge a higher rate they can afford to employ more experienced staff and put more of them on a project. Same with any business. However not everyone wants to pay what ILM or Weta are charging.
  • mkr-hn 14y ago
    You can produce amazing work with entirely free and open source tools like GIMP and Blender, so it's definitely not the technology.
    • pwthornton 14y ago
      I don't think it's the technology at all. It's improving all the time and being refined, and people are understanding how to use the technology better. My theory is that instability in the industry caused by the studios is what's leading to very uneven work. Some of these studios will pay top dollar for big name actors and directors but are willing to have a bunch of random VFX companies from all over the world try to work together to build a coherent vision.
• yk 14y ago
  I wonder, if this is just the result of an technology shift. Twenty years ago, one needed highly specialized guys to build star ship models and coordinate a stop motion animation of a space battle, ten years ago one needed for basically the same scene guys with really expensive workstations and Maya licenses. Today one can do very high quality work with free tools on an standard PC. ( And one can easily copy a few GB of rendered scenes to a server half a world away.) At least my observation is, that quite a few short films ( often as projects from film schools) are getting to a point, where they have really amazing VFX. This trend is probably accelerated by the more general use of VFX. Someone who specializes in building star ship models can only find work in SF films, but today someone who can render a complex transition for an advertisement uses the same technologies as someone who does 'real' VFX and can consequently transition much easier to real movies.
• colmvp 14y ago
  Top tier VFX studios in the U.S. not only hire stellar artists but also help guide the direction of the creative be it a commercial or cutscene. It reminds me of the difference between the various times I've worked with Carbon Five/Pivotal Labs vs a significantly cheaper alternative in another country. In that sense, I don't think the top motion graphics studios will all go out of business because of outsourced work, as their high level of creativity, direction, and execution is simply something outsourced work cannot completely replace. Learning how to be a stellar software engineer is more than just learning how to code in a language or two. Likewise, learning how to be a strong VFX creative is more than just learning how to use a few programs. For the record, the peeps I know in the VFX make just as much money as the average engineer (125k - 250k).
• mixmastamyk 14y ago
  Though not a typical business this sounds like a trade issue to me. Governments are subsidizing a product for export to the detriment of other countries. Perhaps it's time for a large tariff on maple syrup and hockey-pucks?
• sybhn 14y ago
  Sounds like that industry is getting hit by outsourcing, am I reading this right? Does look like articles about software engineering outsourcing a decade ago. The reality is, if your work can be done by someone else at a lower cost, you're in trouble. Whether that person live in your country or not, has little impact nowadays. If you stay at the edge, making sure your work cannot yet be done by someone else, then you'll get paid a premium for it. That's just how things work, basic economics. Don't make taxpayers carry your burden. Ps: written by someone who saw the impact of outsourcing first hand.
  • jinushaun 14y ago
    The problem is if you take that argument to its natural conclusion, the only people in the US with jobs in the future will be waiters and baristas. Who will be able to afford what the robots/companies are selling? It's not that simple. There is a delicate balance between livable wage and low operating costs. Ford knew he had to pay his workers enough to be able to afford the cars they were making.
    • sybhn 14y ago
      actually if you take that argument to its natural conclusion the only people in the US with jobs would be people who innovate and create new value. Don't think that waiters and baristas fit in that category. If i was either, i'd be really worried about my prospect, and would probably fall back to organized labor to protect my jobs, because the economic mechanism definitely would not!