Issue: Volume 36 Issue 3: (Mar/Apr 2013)

Going Green

By: Karen Moltenbrey

As I write this, St. Patrick’s Day is nearly upon us, and everyone is thinking green. Green shirts, green beer, green hair…. Green is also on the minds of those in the visual effects community, albeit for a completely different (and less festive) reason. Immediately after the Academy Awards, digital effects practitioners and their supporters began substituting their Facebook profile pictures with a bright-green square to signify their support for the VFX industry that is going through a financial crisis and the hundreds of artists from Rhythm & Hues (R&H) and elsewhere who more recently were seeing a different color, pink, as in pink slips.

During his acceptance speech after winning the visual effects Oscar for R&H’s work on Life of Pi, VFX Supervisor Bill Westenhofer began addressing the crisis in the industry that led to the facility filing for Chapter 11 protection just days before the Academy Awards and discussing the protest by R&H artists and supporters just hours before the event. But before he could get more than a sentence delivered, his voice was drowned out by the Jaws theme signifying time was up (rather ironic, huh?). Westenhofer was able to continue his comments backstage, as did Ang Lee after receiving his Oscar for best director. But what he had to say was hardly supportive. What Westenhofer had to say on stage and backstage affected nearly everyone sitting in that theater, whether they are part of a VFX-heavy movie or a live-action flick that relies on digital effects, invisible or not. And this is not a situation unique to R&H. Nearly all US visual effects facilities are suffering, as well as some abroad. And the Oscars provided a perfect setting to bring this to light – and that is what former ILM GM and DD Founder Scott Ross believed. So he sent a Tweet early in the day: “I had a dream, 500 VFX artists near the Dolby (Kodak) theater on Oscar day waving signs that say “I want a piece of the Pi too.” People responded. After all, how could artists spend close to a year producing Academy Award-winning work, only to find themselves without a paycheck immediately after? The thought was incredulous.

The artistry created by those working in visual effects is not always apparent on a live-action film, but is easily visible in this shot from Life of Pi.

What Happened?

Studios are having to close their doors because they have been forced to take on work for much lower prices – often breakeven or worse – just so they can keep the lights on and retain stafi. ffiat can only go on for so long. As a result, VFX artists have turned into migrant workers, chasing jobs across the country and abroad. Additionally, they are doing so without health benefits or consistent benefits that follow them from job to job. When they are employed, they are required to work very long hours on a production, often without overtime pay. The facilities, like R&H, value their employees and their skills. They just do not seem to have a choice anymore. How did the situation degrade so fast? It has been a problem brewing in our industry for the past several years but has now reached epic proportions. Turn back the clock, and starting in the mid-1980s, US visual effects studios provoked envy across the globe. For the most part, these studios were formed based on the passion and vision of artists and technical gurus. They achieved things that had never been done before in visual effects: TRON, Jurassic Park, Star Wars…. Later, we began to see more and more work on major movie productions being done outside of Hollywood. Little by little, pixel by pixel, work was sent around the globe. Today, London (particularly Soho) boasts a bustling digital production region where you can find big names and big talent: Cinesite, Framestore, Double Negative, The Moving Picture Company, The Mill, and more. Meanwhile, Weta established New Zealand as a thriving VFX hot spot, with Australia and Canada well known for producing outstanding work as well, while India, Singapore, and a number of other countries are now proving their mettle.

Indeed, VFX has become a global business, and the color of green (money) has become the driving factor – as it is for other businesses. However, VFX is a business that does not have a level playing field. The studios in California are hard-pressed to compete with studios elsewhere. Not for lack of talent, as this area is still the epicenter of VFX, but rather because “elsewhere” provides subsidies so their studios can bid lower on projects. The end result is that US studios in non-subsidized locales must either discount their prices to subsidy levels in order to compete for work, or they have to maintain their prices (so they can turn a small profit) and hope that work is not given to the lowest bidder. Neither is a long-term, viable strategy. So, one by one, giants in the industry have begun to fall – and continue to do so.

So, what is the solution? Unfortunately, no one at this time has a simple answer. The industry, especially in the US, is asking for a ban on subsidies – to create the level playing field. However, why would a studio that is being subsidized forgo that advantage? After all, despite this being an artist-driven industry, it’s still a businessdriven industry. Sometimes, though, the cheapest is not always the best. Moreover, we already have certain areas “out-subsidizing” one another. Vancouver built quite a VFX nest recently, only to see business now being lured east to Montreal. Then there is the matter of the artists securing better working conditions. Some see the answer (not a simple one) in the formation of unions, others do not. But how do you rank the workers? They are artists, not factory workers doing the exact same job.

Immediately after the Oscars, the VES – the industry’s global honorary society – issued a call to action, pressing upon California’s governor and state legislature to “immediately expand its tax incentive program for the entertainment industry and to include a focused approach concentrated on the visual effects and postproduction sectors of the industry.” The VES also plans to hold an international Congress with the goal of determining follow-up actions. Solutions are needed, and needed now. The industry is in crisis. (Just after the R&H situation, news broke that at DreamWorks, about 350 people will lose their jobs by year end, this coming on the heels of a big financial loss on the movie Rise of the Guardians.) Most likely after this issue prints, there will be others looking at a similar fate.

What does this mean for the movie industry, which relies heavily on VFX? One of the popular images in circulation illustrates the value of the work using versions of a still from Life of Pi. Without R&H’s work, the still depicts Pi in the boat ffioating in a water tank against a bluescreen backdrop, while the final contains the tiger, the shimmering ocean, and a beautiful sky. Another uses the shot with Pi stroking the tiger in his lap – both the gorgeous finished scene by R&H and one containing a blue stuffy tiger in the pre-R&H scene. Best of all is the blood-spattered shot showing what would have happen had a real tiger been used instead of the realistic CG animal created at R&H. The point is well made.

VFX practitioners – individuals and studios alike – have had enough. They want, no, they need, this situation rectified. Many served the VFX and movie industry well over the past decades. Many have missed birthdays and holidays working to make deadline. They enjoy what they do, and they are good at it. It’s time the movie industry gives them the respect they deserve.

Twitter and Facebook activity continues with words of anger from those suffering and words of support from those sympathetic to the cause. Signs carried during the protests read: “Respect VFX.” “Oscar nominated work, bankrupt studios?” “This is the first time I’ve been outside in 3 months.” “This sign was added in post.” “I want a piece of the Pi too, stop subsidies.” “Give US VFX workers healthcare stability and their fair share.”

What Others Think

One person wrote to us pointing out that in Prague, VFX artists are paid far less than those in the US. “With artists who will work for next to nothing, it is easy for international companies to compete with the US. I don’t think tax breaks will cut it.”

Jay Roth, former 3D Division president at NewTek and current partner at EverWitt Productions, noted that the situation outlined in the grievances has been endemic and pervasive, and was present when he started in the business in 1980. “The plight of the VFX community is real; they are on the bottom of the totem pole and clearly not appreciated by the ‘glitterati’ or the producers and studios who treat them as lucky to have a job. VFX people have been funding Hollywood since Jaws.” As he pointed out, most of the top 10 films on anyone’s list contains films reliant on VFX (in some cases, heavily so, such as Life of Pi ).

“Actors on these films are paid in the millions for their on-set performances, back-end royalties, along with licensing and merchandising revenues. No one begrudges them their due; however, the VFX teams are often just as responsible for the success of the film as the performance of the actors. But you would never know it from their compensation, benefits, and the like,” Roth said. He added that the VFX community is very motivated, activated, and, thanks to social media, fully connected now. “The stories of abuse are worldwide. Hopefully positive change will result from those who still practice their art and science in the business, though I fear not.”

Jenny Fulle, founder of fie Creative- Cartel, pointed out that the VFX industry has been changing a lot in the past five to 10 years, becoming more global, with tax subsidies more common. “It is becoming increasingly impossible for companies in non-subsidized areas to be competitive at this point. When a government is offering a 30 percent to 59 percent tax incentive or tax credit, you cannot compete with that if subsidizes are not offered in your area too,” she said. “I don’t know if you can end the subsidies, but we need to somehow neutralize the effect they are having. All the subsidies are creating a false economy, and until we end the false economy, it will be difficult to address the other problems such as compensation, benefits, work schedule, overtime, and so forth.”

While state subsidies within the US are present, Fulle noted that it is the international subsidies that are having the greatest impact. She recalled two decades ago when UK studios got their start, thanks to subsidies. It took years for the UK visual effects community to hit its stride in terms of quality. fie same has happened in Vancouver now, and you have a strong, experienced community of VFX artists and companies taking root. “In both these cities, you now have visual effects artistry that can stand on its own. Granted, without subsidies, there would likely be a considerable consolidation of companies, with only the most healthy and talented surviving.”

fie bottom line: A lot of the work we do can be done in a number of places around the world. “But, if the industry continues to chase subsidies, then the new pockets of VFX expertise are never going to have the time to grow and the work will dumb down a bit,” said Fulle.

A level playing Theld is key, but there is no easy solution to achieving that. A bandaid is needed now to stop the bleeding (and that could mean a tax incentive program in California) until a more permanent solution can be made at the global level. Until then, companies likely will take chances on studios in areas with subsidies for artist-driven work, thus dilute the artistry of VFX because you are chasing the dollar savings and not making your decisions based strictly on the artistry, said Fulle. “Right now, there is too much supply, and that is causing a rumbling through the industry. fiere is not enough work to go around. And chasing subsidies is a difficult business model, which isn’t beneficial or healthy for the VFX community.” Bobby Beck, CEO/co-founder of Animation Mentor and former Pixar animator, said that despite the current situation in VFX, the industry does indeed have work to offer artists. “We are in an exciting time, as this issue has existed for a long time and it seems like there is visibility and momentum in the right direction to truly solve it.”

Beck and his AM team are ingrained within the industry: co-founders Shawn Kelly and Carlos Baena are working as animators at ILM and Paramount Pictures, respectively. And all are deeply concerned, but not exactly surprised. As Beck pointed out, the industry has been changing for a long time, and there are diametrically opposed forces working against each other to solve this issue. One, big film studios want lower prices. Two, the quality of work the VFX studios are doing is getting more challenging and, as a result, more costly. Beck believes that the current situation with VFX is one that can be solved by the big film studios themselves if they are willing to support the VFX industry that continues to drive their most profitable films – the point of the “going green” movement on the social media channels.

›› See a Q&A with Beck about how this may afiect schools, accessible under “Extras” in the March-April 2013 issue box on CGW.com.

Scott Ross actually summed up the situation nicely in a radio interview he did shortly after the Oscars. He was visibly upset.

“When I was running ILM, this was a cottage industry populated by technologists and creative artists. fiere was a quote back then by George Lucas that if you feed those ILM people enough beer and pizza, they will do anything. Now it’s a lot of business, and the size of budgets have gone up tremendously,” Ross said. He noted that on movies like Batman, Avatar, and so forth, VFX can cost $100 million and is by far the biggest line item in the budget. However, studios are actively trying to drive the price down to get the work. “We are architects of building stuffthat has never been built before and we do it on a fixed price. fiat, combined with tax subsidies around the work, and the profit margins are 3 to 4 percent in a good year.” Consider what occurred on the Twilight movies, Ross said. British Columbia was offering a 35 percent tax rebate, so studios had to do the job in Vancouver. Studios spent $1 million to open there, and then the workers were imported to the facilities. “So now we have a population of migrant digital artists in New Zealand, Vancouver, Mumbai….”

VFX appears to be the future of filmmaking, Ross notes. And a trade association has to go into effect and a cohesive voice needs to say to the studios that the business model does not work, and if it does, “you are shooting the goose that lays the golden egg. Motion picture studios are doing what they can to get the best work for the least amount of money. fiat is business. We then say we will do anything [to get the work.] We have not taken ours seriously and not realized our value, and now we have to go back to the studio and say, ‘this is the way it needs to be done,’ and come up with a new business model.”

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