This is the first post in a very complicated topic, the issue of employment and unemployment in the fields of computer animation & visual effects production. For those of my friends who live and work in the beautiful and rarefied air of academia or the "fine" arts, there has been a major retrenchment of visual effects and (possibly) computer animation production in California and Los Angeles. A tremendous amount of work has moved overseas and those companies that remain are seemingly expanding only in that they expand their overseas divisions. But how much of this true, what the numbers are, what the reasons and causes are, and what is to be done about it, all these things are somewhat vague. But if you can accept for a moment that hard numbers are, well, hard to come by, there are some things we can say with reasonable certainty.
1. A tremendous amount of high end visual effects work has moved overseas. That is indisputable. There are in my estimation roughly 10 or so major players in high-end visual effects in the top tier, then perhaps another 50 or so middle-tier companies, and finally hundreds of rather small companies (which of course come and go with a depressing regularity). A review of the Cinefex online database of upcoming visual effects films (which requires a bit of interpretation to distinguish which vendor received $20M in work from those that received $20K in work) shows projects being awarded to WETA (New Zealand), Double Negative (London), MPC (London), Cinesite (London), ILM (SF), SONY Imageworks (LA), R&H (LA), and Digital Domain (LA).
2. It is alledged that tax subsidies of New Zealand, Canada and the United Kingdom (all Commonwealth countries) is the cause of a tremendous amount of work being awarded to these countries. That is certainly true in the case of Canada, it may also be true in the other two cases, but there are other factors at work. What is clear is that for a variety of reasons these governments have chosen to support these industries in their various countries and that this strategy has certainly worked, whether or not it has been the only cause of their success is debatable.
3. It is not clear whether the State of California and the US Government has been merely indifferent to the loss of work and jobs to overseas, or whether they actively support that move. Why would they support the loss of jobs and revenues ? Because they know where their real money comes from, and that is from the major studios, not from the visual effects companies or income taxes. The studios make money in many ways, but in broad strokes they make money by making entertaining movies, keeping their costs of production and labor down, and licensing their intellectual property. Obviously moving production to countries that lower their costs of production in straightforward ways (as Canada certainly does) is desirable to them. But I am not sure the studios actually work with politicians to support these policies, it seems to be the dominant and bipartisan goal of Washington at least to do anything necessary to impoverish the American worker and the VFX industry is just a tiny part of their very successful policies to do this.
4. It is also alledged that a tremendous amount of work goes to India. Certainly many of these companies have divisions in India. R&H was the first to set up an Indian subsidiary, Sony Imageworks certainly has one, and the "dimensionalization" companies are in many cases Indian-owned. Although India is part of this phenomena that we are discussing here, it is less clear how much high end work goes to India, and how much of this is straightforward compositing and wire removal.
However, the above issues are just the first part of the story and there is much more to say. What is the role of the VES (visual effects society). To what extent is the unemployment due to a glut of workers ? To what extent do these workers have unrealistic expectations ? How has "animation" been affected in contrast to "visual effects" now that both of these industries have wiped out their "traditional" colleagues and have gone entirely digital (in other words, is this unemployment nothing more than justice for evil done in the past )?
More in Part 2.
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