Not long ago I posted about a possible global VFX worker guideline or seal of approval.
Please read it if you haven't already.
I received some good responses directly from people.
So if we had a chance to take this to the next step, what is on your working conditions wish list?
Required turn around time?
Safer worker environments?
Paid overtime?
What are your top issues?
I know most people don't post comments on this blog. Usually I get one posting for several thousand reads. Well now here's your chance to stand up and be counted. Put your wish list solutions / complaints in a place that might actually make a difference in the future.
Thanks.
Showing posts with label globalization. Show all posts
Showing posts with label globalization. Show all posts
Thursday, March 31, 2011
Thursday, March 10, 2011
Global VFX Workers
Paddy Eason from the U.K asked in a previous posting about the possibility of a global union for vfx workers.
The following are some notes I wrote this last weekend. Some this refers back to a previous posting I had made. I’m just tossing out some possible ideas to get people thinking about options.
Unfortunately various government laws and varying health care options make having a traditional union be global a difficult proposition. IATSE (union of camera crews and most of the crafts people working in motion pictures) covers the US and has parallel labor agreements in Canada. How far they can move beyond Canada would be worth a discussion with them. (For those in LA there's a union picnic this Burbank on Sunday afternoon. You can also contact them via email jgoodman@iatse-intl.com)
As a union employee if I go to another country and the company paying me is a union company, I would continue to work under those terms but that’s not the same as being a global union.
Before there was the real prospect of a true vfx union here in the U.S. I posted about establishing a Code of Standards for vfx companies. Should the union efforts fail it might be worth considering. And certainly may be worth considering in areas with a number of vfx or related companies that aren’t covered by a union.
The idea would be to have a group of vfx workers draft a list of working conditions requirements. I would suggest using some of the existing union documents as a starting point. Some of the possible issues could be: weekly payments (paid on time), if payment is not made worker has right to leave, clean work environment, safe work environment, ergonomical working setup, food break every 6 hours, 15 minute break every 4 hours, 12 hr minimum turnaround time (time you clock out until you’re required back at work), and might include such things as: limit of x hrs in a day, limit of x hrs a week, limit of x days without a day off, double time after x hrs, double time starting on 6th day and beyond, etc. Now the real unions do include some of these things such as food breaks, turnaround time, over time rates, etc but they don’t include any caps on amount of hours or days worked to my knowledge but I know that’s an issue with a lot of vfx workers who are tired of working 90-120 hr weeks.
So the issue would be for a group to come up with reasonable guidelines for both workers and companies. All of these things would need to be feasible throughout the world. The idea is to set a minimum level working environment. I should point out most medium to large vfx shops already provide reasonable environments so that portion shouldn’t be an issue.
This document probably wouldn’t cover such things as actual minimum rates for different types of positions but they could if it was desired. There is cost of living that already known and calculated for all major cities in the world. When I worked in London I had a given per diem that would qualify under the US tax code. This would mean it’s possible to say a roto person would be paid at least x % of the cost of living index in that city. A Compositor would be paid a minimum of y %. So if you worked in London and moved to New York or China you’d have some idea for what the minimum would be. Note that these are minimums, just like the union does. You can certainly negotiate higher rates depending on your experience, skill, etc.
Once a guideline was drafted then the idea would be to discuss it with the different companies. Now many vfx do have reasonable working conditions so the biggest sticking points with them would be the caps on time worked or if the overtime was higher than they’re currently paying. Of course those factors would also encourage them and the studios to do more planning and to avoid getting into situations that workers are squeezed.
This guideline may not touch on benefits or it’s possible that may only be in U.S. version. Many US companies have some types of benefits so this would merely list the minimum benefits in order to get the seal of approval as it were.
So what would be in it for the vfx companies?
Assuming the guidelines are not unreasonable most companies probably qualify now. (With exceptions of caps as noted) If a company signs then they are listed on the group website with the seal of approval of the vfx workers. Now when vfx workers finish up a project or are considering working elsewhere the seal of approval would be part of their decision process of where they’d want to work. If all other things were equal most would tend to opt to go to a company that was willing to commit to signing the guidelines. Because you’d know if the company was unwilling to signup then it’s likely not up to the same working standards or that it could easily drop those working standards when they choose. Key info about the company could also be posted such as benefits packages, etc. Signed companies could possibly run job postings on the site.
Studios would also be aware which companies provided reasonable working conditions. Now that might not have much influence but again if all things were equal the studio would know the company is serious about getting the best workers and less likely to cause a problem. It would also help separate the fly by night companies from the companies who are in it for real. This last part would depend on what requirements and vetting would be required. The hope would be if both workers and studios leaned toward companies with the seal of approval, more companies would be interested in signing and maintaining those working conditions.
I’ve thought of these as largely non-legal and non-binding documents. It could go the other way and these could be made to have more teeth but just getting the thing rolling would be the biggest step. With today’s communication it would be then easy to monitor the companies. Any verified infractions of the guidelines would be listed on the web page so if a company didn’t live up to the guidelines that would be noted (possibly with worker ratings) and if it was bad enough then they’d be removed.
Let’s suppose a company doesn’t pay their workers on a given week. The workers would contact the global vfx group handling all of this. They contact the vfx company and suggests the workers should be paid in 24 hrs. If that doesn’t happen the workers can quit, the group tweets and a big red x is put over the company name on the website (so workers now avoid that place like the plague) and the group sends a note to Variety and related outlets that this specific vfx company didn’t pay their workers this last week even though they’re working on such and such movie or tv show. Imagine a director, producer or studio with current work at this company or those considering bringing a project to this company. I suspect there would be a few phone calls happening with the owner’s of the vfx company. As I covered in another post, don’t be taken advantage of. Act as a group if there is a major problem at the company you work for. It’s the only way to have some control over the situation. Quit if you’re not paid.
So the good news you could conceivably have some type of consistent seal of approval and at least have some minimum working conditions. Now most of this is similar to a union but a union is already setup for this type of thing and they have true contracts with the companies. In most areas of the US if the majority of a workers at a company want to unionize they can do so. At that point it’s not optional for the company. And a union is united with other unions so there’s even more strength in numbers. A union also provides transferable benefits between companies that this does not.
Trade organization
The other part of all of this is a potential trade organization. There have been a few meetings and what started as a US centric group has potentially expanded to more of a global organization. I say potential since even though there have been some meetings there has been very little activity.
There are a number of trade organizations that cover a wide range of services and products all over the world. They’re tailor fit for their common good.
A trade organization would help to standardize bidding (similar to AICP commercial bids) and other things. As a group it could allow sub-groups to lobby for tax breaks or advertise as a group. Companies couldn’t have collusion (setting the same bids) but I believe they could set a minimum (i.e. no less than the actual cost of the work). This would prevent a race to the bottom.
Trade organizations tend to be thought of in a very stereotypical fashion, just as unions are. There would be concern if each sub-group was lobbying that there would conflict between sub-groups. Here’s the thing, you’re building a group from scratch so it can be what you want it to be. (A vfx union from scratch could also has a certain amount of flexibility of structure) Organize and cover the things that are similar. Build on that. If there are non-overlapping areas or areas that are at odds, then that’s probably not covered by the group.
A trade organization could actually do many of the things listed above (Seal of Approval) and if they took it a step further it’s likely they could provide some mechanism for providing benefits that traveled at least for workers within that country to other companies in the trade organization. The problem though is all power and control is in their hands and if they chose tomorrow to stop benefits there would be nothing to prevent them. That’s why in many industries there is a worker’s group (or union) and the companies to balance the power just as some governments have multiple branches to allow a balance of power.
The following are some notes I wrote this last weekend. Some this refers back to a previous posting I had made. I’m just tossing out some possible ideas to get people thinking about options.
Unfortunately various government laws and varying health care options make having a traditional union be global a difficult proposition. IATSE (union of camera crews and most of the crafts people working in motion pictures) covers the US and has parallel labor agreements in Canada. How far they can move beyond Canada would be worth a discussion with them. (For those in LA there's a union picnic this Burbank on Sunday afternoon. You can also contact them via email jgoodman@iatse-intl.com)
As a union employee if I go to another country and the company paying me is a union company, I would continue to work under those terms but that’s not the same as being a global union.
Before there was the real prospect of a true vfx union here in the U.S. I posted about establishing a Code of Standards for vfx companies. Should the union efforts fail it might be worth considering. And certainly may be worth considering in areas with a number of vfx or related companies that aren’t covered by a union.
The idea would be to have a group of vfx workers draft a list of working conditions requirements. I would suggest using some of the existing union documents as a starting point. Some of the possible issues could be: weekly payments (paid on time), if payment is not made worker has right to leave, clean work environment, safe work environment, ergonomical working setup, food break every 6 hours, 15 minute break every 4 hours, 12 hr minimum turnaround time (time you clock out until you’re required back at work), and might include such things as: limit of x hrs in a day, limit of x hrs a week, limit of x days without a day off, double time after x hrs, double time starting on 6th day and beyond, etc. Now the real unions do include some of these things such as food breaks, turnaround time, over time rates, etc but they don’t include any caps on amount of hours or days worked to my knowledge but I know that’s an issue with a lot of vfx workers who are tired of working 90-120 hr weeks.
So the issue would be for a group to come up with reasonable guidelines for both workers and companies. All of these things would need to be feasible throughout the world. The idea is to set a minimum level working environment. I should point out most medium to large vfx shops already provide reasonable environments so that portion shouldn’t be an issue.
This document probably wouldn’t cover such things as actual minimum rates for different types of positions but they could if it was desired. There is cost of living that already known and calculated for all major cities in the world. When I worked in London I had a given per diem that would qualify under the US tax code. This would mean it’s possible to say a roto person would be paid at least x % of the cost of living index in that city. A Compositor would be paid a minimum of y %. So if you worked in London and moved to New York or China you’d have some idea for what the minimum would be. Note that these are minimums, just like the union does. You can certainly negotiate higher rates depending on your experience, skill, etc.
Once a guideline was drafted then the idea would be to discuss it with the different companies. Now many vfx do have reasonable working conditions so the biggest sticking points with them would be the caps on time worked or if the overtime was higher than they’re currently paying. Of course those factors would also encourage them and the studios to do more planning and to avoid getting into situations that workers are squeezed.
This guideline may not touch on benefits or it’s possible that may only be in U.S. version. Many US companies have some types of benefits so this would merely list the minimum benefits in order to get the seal of approval as it were.
So what would be in it for the vfx companies?
Assuming the guidelines are not unreasonable most companies probably qualify now. (With exceptions of caps as noted) If a company signs then they are listed on the group website with the seal of approval of the vfx workers. Now when vfx workers finish up a project or are considering working elsewhere the seal of approval would be part of their decision process of where they’d want to work. If all other things were equal most would tend to opt to go to a company that was willing to commit to signing the guidelines. Because you’d know if the company was unwilling to signup then it’s likely not up to the same working standards or that it could easily drop those working standards when they choose. Key info about the company could also be posted such as benefits packages, etc. Signed companies could possibly run job postings on the site.
Studios would also be aware which companies provided reasonable working conditions. Now that might not have much influence but again if all things were equal the studio would know the company is serious about getting the best workers and less likely to cause a problem. It would also help separate the fly by night companies from the companies who are in it for real. This last part would depend on what requirements and vetting would be required. The hope would be if both workers and studios leaned toward companies with the seal of approval, more companies would be interested in signing and maintaining those working conditions.
I’ve thought of these as largely non-legal and non-binding documents. It could go the other way and these could be made to have more teeth but just getting the thing rolling would be the biggest step. With today’s communication it would be then easy to monitor the companies. Any verified infractions of the guidelines would be listed on the web page so if a company didn’t live up to the guidelines that would be noted (possibly with worker ratings) and if it was bad enough then they’d be removed.
Let’s suppose a company doesn’t pay their workers on a given week. The workers would contact the global vfx group handling all of this. They contact the vfx company and suggests the workers should be paid in 24 hrs. If that doesn’t happen the workers can quit, the group tweets and a big red x is put over the company name on the website (so workers now avoid that place like the plague) and the group sends a note to Variety and related outlets that this specific vfx company didn’t pay their workers this last week even though they’re working on such and such movie or tv show. Imagine a director, producer or studio with current work at this company or those considering bringing a project to this company. I suspect there would be a few phone calls happening with the owner’s of the vfx company. As I covered in another post, don’t be taken advantage of. Act as a group if there is a major problem at the company you work for. It’s the only way to have some control over the situation. Quit if you’re not paid.
So the good news you could conceivably have some type of consistent seal of approval and at least have some minimum working conditions. Now most of this is similar to a union but a union is already setup for this type of thing and they have true contracts with the companies. In most areas of the US if the majority of a workers at a company want to unionize they can do so. At that point it’s not optional for the company. And a union is united with other unions so there’s even more strength in numbers. A union also provides transferable benefits between companies that this does not.
Trade organization
The other part of all of this is a potential trade organization. There have been a few meetings and what started as a US centric group has potentially expanded to more of a global organization. I say potential since even though there have been some meetings there has been very little activity.
There are a number of trade organizations that cover a wide range of services and products all over the world. They’re tailor fit for their common good.
A trade organization would help to standardize bidding (similar to AICP commercial bids) and other things. As a group it could allow sub-groups to lobby for tax breaks or advertise as a group. Companies couldn’t have collusion (setting the same bids) but I believe they could set a minimum (i.e. no less than the actual cost of the work). This would prevent a race to the bottom.
Trade organizations tend to be thought of in a very stereotypical fashion, just as unions are. There would be concern if each sub-group was lobbying that there would conflict between sub-groups. Here’s the thing, you’re building a group from scratch so it can be what you want it to be. (A vfx union from scratch could also has a certain amount of flexibility of structure) Organize and cover the things that are similar. Build on that. If there are non-overlapping areas or areas that are at odds, then that’s probably not covered by the group.
A trade organization could actually do many of the things listed above (Seal of Approval) and if they took it a step further it’s likely they could provide some mechanism for providing benefits that traveled at least for workers within that country to other companies in the trade organization. The problem though is all power and control is in their hands and if they chose tomorrow to stop benefits there would be nothing to prevent them. That’s why in many industries there is a worker’s group (or union) and the companies to balance the power just as some governments have multiple branches to allow a balance of power.
Monday, August 09, 2010
Incentive and film program updates
Every week there seem to be new updates on state or country incentive and film programs.
Here's a snippet:
Scottish-born producer Iain Smith, whose credits include "The A-Team," "Children of Men" and "Local Hero," expressed the need for the government to quickly form a plan or risk producers looking elsewhere to shoot films.
"While we have a fantastic infrastructure, we have to protect that as much as we can and in order to do that we have to compete against industries in other countries," said Smith. "There's no doubt we need to tighten purse strings but we need to be careful we don't asphyxiate the film industry in general."
But in an article written for Blighty's Observer newspaper on Sunday, culture secretary Jeremy Hunt hit back at critics.
"If we are going to face budget cuts I have a duty to ensure that taxpayers' money is spent where it gets the most bang for its buck," he said. "It is simply not acceptable in these times to fund an organization like the U.K. Film council where no fewer than eight of the top executives are paid more than £100,000 ($160,000)."
Hunt added: "Stopping money being spent on a film quango is not the same as stopping money being spent on film."
"While we have a fantastic infrastructure, we have to protect that as much as we can and in order to do that we have to compete against industries in other countries," said Smith. "There's no doubt we need to tighten purse strings but we need to be careful we don't asphyxiate the film industry in general."
But in an article written for Blighty's Observer newspaper on Sunday, culture secretary Jeremy Hunt hit back at critics.
"If we are going to face budget cuts I have a duty to ensure that taxpayers' money is spent where it gets the most bang for its buck," he said. "It is simply not acceptable in these times to fund an organization like the U.K. Film council where no fewer than eight of the top executives are paid more than £100,000 ($160,000)."
Hunt added: "Stopping money being spent on a film quango is not the same as stopping money being spent on film."
|
"This new credit will give New York post production services a much needed competitive edge," explains Rich Friedlander, co-founder of Brainstorm Digital. "We increasingly saw visual effects post work going to Canada thanks to their their Digital Animation or Visual Effects tax credit (DAVE). This new program will allow work that was filmed in New York to stay through its entire production cycle. It's a major move that will attract and keep top talent here in state."
Saturday, July 10, 2010
Globalization and VFX
Globalization and VFX
One of the issues facing VFX companies and artists is the issue of globalization. Given the tax incentives and cost of living variance around the world most film studios are looking beyond the borders to find a better price for doing film work, including visual effects.
This blog is read around the world. This article will have a California slant but I’m trying to as always document the current state of affairs in visual effects.
In the golden age of movie making most Hollywood films were shot in Los Angeles with some being done in New York. The studios were setup as film factories to be as efficient as possible. If you finished a film on Friday, you'd start another film on Monday. The stages, sets, back lots and rear projection allowed them to shoot a wide range of film settings within the confines of the studio lot. If you want New York in the 1890's you go to one block of the back lot. If you wanted a1940's Midwest town you'd make a left into that back lot street. Many 'locations' were within easy driving distance of the studios, which also had ranches and other outdoor areas where they could construct western towns or other special settings.
With films like Easy Rider studios started to reconsider what they needed. Many back lots were sold for short-term gains and more true location shooting was done. In some cases if a film could be shot at a lower price in a different location that made sense. In other cases it made sense to go to another location if that truly was the location in film.
When films like Star Wars and Close Encounters were filmed the majority of visual effects were done in Los Angeles. When ILM moved to northern California that spread the work a bit but still the majority of the big, Hollywood vfx work was done within California. VFX companies were on a relatively level playing field. The jobs were awarded based on ability, quality and costs.
As the digital age of visual effects got underway some countries and states started offering tax incentives that included vfx. The digital age enabled the use of computers and software to be setup anywhere. VFX artists can be brought in from anywhere else and setup with little effort. VFX artists can be trained in the basics locally. The internet allows images to be sent anywhere quickly for work to be done and reviewed anywhere else. The studios, always eager to save money on things that weren’t under their umbrella, were more than happy to start sending out work. In their view, vfx are a commodity that can be done anywhere.
At this point a number of countries offer tax incentives, rebates or even pre-investments in films in exchange for a certain amount of work to be done in that country. Various states also have tax incentives as well to try to get millions of dollars of production costs to come to their state. The details vary greatly and can be a smart or bad investment depending on the details.
From the various governments viewpoint (state and country) an incentive means that they can draw film production to their location. A film production can bring in millions of dollars to a given locale fairly quickly. A factory doesn’t have to be built over time before people can be employed and there usually aren’t a lot of ecology studies required. All the products, services and rentals that can be had are paid for by production (hotels, catering, car rentals, hardware stores, etc). The crew spends a fair bit of their money locally on things like restaurants, bars and leisure time activates. If a location is portrayed well it may mean extra tourists in the future. When long-term incentives are in place then an entire film studio infrastructure can be built in that location and crewmembers of all types can be developed, including visual effects artists. Many third party companies develop to service the motion picture industry at these locations.
Companies in Vancouver, London and similar locations are doing well since they don’t have to compete on a level playing field. With a 20% or more savings via the government it’s difficult for vfx companies in the U.S. to compete directly.
From the studio perspective their main aim is to do a film as cheaply as possible and still make it work. If the film is a major VFX tent pole movie with a lot of difficult or new vfx then they will pay top dollar to make it and to ensure it will be done on time and to the quality required. But this only applies to those shots and sequences they feel need to be done at expensive vfx companies. One step down from those types of shots (certainly simpler compositing and roto shots) or lower level vfx film and price becomes one of the highest priorities.
A Hollywood studios first choice is usually Vancouver simply because it’s in the same time zone, is just a 3 hour flight away and they all speak English there. Second choice would probably be London since it’s the next closest location, they speak English and studios executives and key personal enjoy the London life. Next would be Australia. (New Zealand with Weta is primarily on the big projects and not so much a cost saving measure). India, China and other locations are further down on the list if the studio executives and key personnel think they will have to go there. If they don’t have to personally travel there, then the studio is all for sending the work anywhere in the world.
Obviously some studios now have infrastructures setup in various locations and their choice will be dictated by their established suppliers. You’ll notice most editing and sound mixing still happens in the U.S. since the filmmakers and studios spend a fair bit of time involved directly in these activities. They’re also not at the same level of expense as vfx.
Some people think that the studios won’t go anywhere just based on price but it’s very dependent on the nature of the work. There was an article a few months ago where most of the studios were now sending out their subtitling work (as done on the DVD’s). The cost savings to the studio? $600. A $100 million dollar movie and they send out the subtitling to a different country to save $600. I’m not a studio accountant but I suspect there might be a few other budget items that would yield larger savings but since subtitling (and vfx) are done by third parties it’s an easy win for any studio person to make that decision.
Unfortunately the location that has the most to lose (and gain) from subsidies is California. They have done too little, too late. A large revenue stream for California (especially southern California) comes from movies. There are a lot of people employed in this business and they in turn spend their money locally on services and products.
Runaway product continues to suck out revenues from California and unfortunately most of the California legislation can’t get a simple grasp of the obvious. Motion pictures are one of the U.S.’s largest exports.
People (and politicians) assume since movies bring in huge revenue that everyone who works in movies are ‘gazillionairs’ to quote another internet forum. What they forget is the vast majority of people involved in movie making are making working wages. The median income for writers in the Writers Guild is $44,000 a year. Most VFX people make more than this but if it’s averaged over all vfx artists and dry spells it may not be as much as you think.
Some US companies are opening satellite companies in other countries that are able to offer a better price break. There are multiple arrangements. In some cases they simply outsource the work they feel can be outsourced such as Roto. In other cases they have a full working relationship where the foreign company does a fair bit of real work on the actual product. Some companies operate independent shops in different countries that can be leveraged, as the work requires it.
Part of the issue is what is to be gained for everyone involved. If the focus of the studios is purely on the cost factor, having a US based VFX company doesn't necessarily gain them much. They're willing to pay top dollar today for certain projects with a lot of R&D but what happens in a few years when those techniques and software are more readily available in off the shelf products? If your California vfx company has some specialty (water, fire, etc) what happens when that’s all in the next major update of a software package? Will you continue to get work? What happens when vfx production management elsewhere is brought up to the same level? Will the studios continue to be willing pay more to a U.S. company to act as an intermediate?
Will most of the work being done in the US move out of the country and the only thing remaining be the vfx company executives and accountants?
If you live in a country that is currently doing well (healthy vfx production) because of the incentives or reduced expenses what happens when that changes? At some point your government may reduce or eliminate the incentive. Another country may offer a higher incentive. The world and local economy may increase the cost of doing business such that the incentives aren’t enough or another location may end up being even a lower expense because of changing cost of living factors. The studios will quickly move to the lowest priced area that can provide them what they need. Can you and the company you work for compete on a level playing field if it had to? Is your company truly efficient? Does it have the talented artists and R&D people required?
If you live in California (or starting here) what can you do?
1. You can work at some of the larger companies such as ILM, DD, etc. These still get large projects but they still lay off massive amounts of people and still go through cycles of feast or famine work so there’s no guarantee of long-term employment even if you’re considered on staff.
2. Consider working at a small to mid-size shop that continues to maintain a reasonable balance of work. Many of these do all television work (which is usually done here or in Vancouver) or that at least do some television work to help balance the work.
3. Consider moving out of country to where the actual work is being done. This sounds like a simple fix to anyone who doesn’t consider the implications.
a. There are already people working there. Are there enough job openings to make it worth moving there?
b. How long is the project? Is this a permanent move or will you have to shuffle off again in few months to somewhere else?
c. Can you qualify to work elsewhere? Many countries require work visas and other paperwork. Some incentives require crewmembers to be living in the country for a given length of time. Just because there is technical and creative work elsewhere doesn’t mean you can just move there and start working.
d. Can you work at reduced wages if that’s the reason the work is located in that country? If you’re at a location that is getting work based mainly on the cost of living can you work there yourself at the reduced rate and feel comfortable? Does the local taxes and other issues reduced the income even further?
e. What happens if you have loved ones, family, house or other connections here? If you’re young and single it may be fun and exciting to move to another location. For those of us with families do we sell the house and uproot all family members (taking children out of school and away from their friends) to go work in another country? Do we leave the family for long periods of time? (6 months to a year or longer) Do we try to rent out the house and hope to return someday?
It’s a sad state of affairs when experienced vfx artists, with all of their creative and technical skills, are likened to migrant farm workers moving to where the work is. At least there’s a real reason farm workers move is because of locations of the crops and growing seasons. In the case of the vfx artist a cubicle is a cubicle, no matter where in the world it’s located. The only reason for moving is purely at the whim of the counties incentives and the studios.
Unfortunately I can’t offer any real solutions. The unions can’t prevent work from moving out of the country. The politicians seem to be the few who have much control over this so they’re the ones to contact. I know that there are some organizations trying to make this better. If you’re in a location doing well then enjoy it while you can. If you’re in California it’s likely you’ll have to do what you have to do. There are now some vfx supes that spend months shooting in one country and then do the post in another country and spend most of the year away from their families.
Will there be enough of a demand and balance that all the vfx companies and artists throughout the world can keep reasonably busy and can enjoy the fruits of their labor?
(Links added 7/12/10 based on VFX Soldier comment posting. See comments for my basic response at this time. The links all make interesting reading and really get to the heart of the matter.)
VFX Soldier VFX Subsidy War Grows Into Global Trade War
Update 8-9-2010
Every week there seem to be new updates on state or country incentive programs.
Clint Eastwood makes UKFC plea - Entertainment News, Top News, Media - Variety
Here's a snippet:
Scottish-born producer Iain Smith, whose credits include "The A-Team," "Children of Men" and "Local Hero," expressed the need for the government to quickly form a plan or risk producers looking elsewhere to shoot films.
"While we have a fantastic infrastructure, we have to protect that as much as we can and in order to do that we have to compete against industries in other countries," said Smith. "There's no doubt we need to tighten purse strings but we need to be careful we don't asphyxiate the film industry in general."
But in an article written for Blighty's Observer newspaper on Sunday, culture secretary Jeremy Hunt hit back at critics.
"If we are going to face budget cuts I have a duty to ensure that taxpayers' money is spent where it gets the most bang for its buck," he said. "It is simply not acceptable in these times to fund an organization like the U.K. Film council where no fewer than eight of the top executives are paid more than £100,000 ($160,000)."
Hunt added: "Stopping money being spent on a film quango is not the same as stopping money being spent on film."
"This new credit will give New York post production services a much needed competitive edge," explains Rich Friedlander, co-founder of Brainstorm Digital. "We increasingly saw visual effects post work going to Canada thanks to their their Digital Animation or Visual Effects tax credit (DAVE). This new program will allow work that was filmed in New York to stay through its entire production cycle. It's a major move that will attract and keep top talent here in state."
One of the issues facing VFX companies and artists is the issue of globalization. Given the tax incentives and cost of living variance around the world most film studios are looking beyond the borders to find a better price for doing film work, including visual effects.
This blog is read around the world. This article will have a California slant but I’m trying to as always document the current state of affairs in visual effects.
In the golden age of movie making most Hollywood films were shot in Los Angeles with some being done in New York. The studios were setup as film factories to be as efficient as possible. If you finished a film on Friday, you'd start another film on Monday. The stages, sets, back lots and rear projection allowed them to shoot a wide range of film settings within the confines of the studio lot. If you want New York in the 1890's you go to one block of the back lot. If you wanted a1940's Midwest town you'd make a left into that back lot street. Many 'locations' were within easy driving distance of the studios, which also had ranches and other outdoor areas where they could construct western towns or other special settings.
With films like Easy Rider studios started to reconsider what they needed. Many back lots were sold for short-term gains and more true location shooting was done. In some cases if a film could be shot at a lower price in a different location that made sense. In other cases it made sense to go to another location if that truly was the location in film.
When films like Star Wars and Close Encounters were filmed the majority of visual effects were done in Los Angeles. When ILM moved to northern California that spread the work a bit but still the majority of the big, Hollywood vfx work was done within California. VFX companies were on a relatively level playing field. The jobs were awarded based on ability, quality and costs.
As the digital age of visual effects got underway some countries and states started offering tax incentives that included vfx. The digital age enabled the use of computers and software to be setup anywhere. VFX artists can be brought in from anywhere else and setup with little effort. VFX artists can be trained in the basics locally. The internet allows images to be sent anywhere quickly for work to be done and reviewed anywhere else. The studios, always eager to save money on things that weren’t under their umbrella, were more than happy to start sending out work. In their view, vfx are a commodity that can be done anywhere.
At this point a number of countries offer tax incentives, rebates or even pre-investments in films in exchange for a certain amount of work to be done in that country. Various states also have tax incentives as well to try to get millions of dollars of production costs to come to their state. The details vary greatly and can be a smart or bad investment depending on the details.
From the various governments viewpoint (state and country) an incentive means that they can draw film production to their location. A film production can bring in millions of dollars to a given locale fairly quickly. A factory doesn’t have to be built over time before people can be employed and there usually aren’t a lot of ecology studies required. All the products, services and rentals that can be had are paid for by production (hotels, catering, car rentals, hardware stores, etc). The crew spends a fair bit of their money locally on things like restaurants, bars and leisure time activates. If a location is portrayed well it may mean extra tourists in the future. When long-term incentives are in place then an entire film studio infrastructure can be built in that location and crewmembers of all types can be developed, including visual effects artists. Many third party companies develop to service the motion picture industry at these locations.
Companies in Vancouver, London and similar locations are doing well since they don’t have to compete on a level playing field. With a 20% or more savings via the government it’s difficult for vfx companies in the U.S. to compete directly.
From the studio perspective their main aim is to do a film as cheaply as possible and still make it work. If the film is a major VFX tent pole movie with a lot of difficult or new vfx then they will pay top dollar to make it and to ensure it will be done on time and to the quality required. But this only applies to those shots and sequences they feel need to be done at expensive vfx companies. One step down from those types of shots (certainly simpler compositing and roto shots) or lower level vfx film and price becomes one of the highest priorities.
A Hollywood studios first choice is usually Vancouver simply because it’s in the same time zone, is just a 3 hour flight away and they all speak English there. Second choice would probably be London since it’s the next closest location, they speak English and studios executives and key personal enjoy the London life. Next would be Australia. (New Zealand with Weta is primarily on the big projects and not so much a cost saving measure). India, China and other locations are further down on the list if the studio executives and key personnel think they will have to go there. If they don’t have to personally travel there, then the studio is all for sending the work anywhere in the world.
Obviously some studios now have infrastructures setup in various locations and their choice will be dictated by their established suppliers. You’ll notice most editing and sound mixing still happens in the U.S. since the filmmakers and studios spend a fair bit of time involved directly in these activities. They’re also not at the same level of expense as vfx.
Some people think that the studios won’t go anywhere just based on price but it’s very dependent on the nature of the work. There was an article a few months ago where most of the studios were now sending out their subtitling work (as done on the DVD’s). The cost savings to the studio? $600. A $100 million dollar movie and they send out the subtitling to a different country to save $600. I’m not a studio accountant but I suspect there might be a few other budget items that would yield larger savings but since subtitling (and vfx) are done by third parties it’s an easy win for any studio person to make that decision.
Unfortunately the location that has the most to lose (and gain) from subsidies is California. They have done too little, too late. A large revenue stream for California (especially southern California) comes from movies. There are a lot of people employed in this business and they in turn spend their money locally on services and products.
Runaway product continues to suck out revenues from California and unfortunately most of the California legislation can’t get a simple grasp of the obvious. Motion pictures are one of the U.S.’s largest exports.
People (and politicians) assume since movies bring in huge revenue that everyone who works in movies are ‘gazillionairs’ to quote another internet forum. What they forget is the vast majority of people involved in movie making are making working wages. The median income for writers in the Writers Guild is $44,000 a year. Most VFX people make more than this but if it’s averaged over all vfx artists and dry spells it may not be as much as you think.
Some US companies are opening satellite companies in other countries that are able to offer a better price break. There are multiple arrangements. In some cases they simply outsource the work they feel can be outsourced such as Roto. In other cases they have a full working relationship where the foreign company does a fair bit of real work on the actual product. Some companies operate independent shops in different countries that can be leveraged, as the work requires it.
Part of the issue is what is to be gained for everyone involved. If the focus of the studios is purely on the cost factor, having a US based VFX company doesn't necessarily gain them much. They're willing to pay top dollar today for certain projects with a lot of R&D but what happens in a few years when those techniques and software are more readily available in off the shelf products? If your California vfx company has some specialty (water, fire, etc) what happens when that’s all in the next major update of a software package? Will you continue to get work? What happens when vfx production management elsewhere is brought up to the same level? Will the studios continue to be willing pay more to a U.S. company to act as an intermediate?
Will most of the work being done in the US move out of the country and the only thing remaining be the vfx company executives and accountants?
If you live in a country that is currently doing well (healthy vfx production) because of the incentives or reduced expenses what happens when that changes? At some point your government may reduce or eliminate the incentive. Another country may offer a higher incentive. The world and local economy may increase the cost of doing business such that the incentives aren’t enough or another location may end up being even a lower expense because of changing cost of living factors. The studios will quickly move to the lowest priced area that can provide them what they need. Can you and the company you work for compete on a level playing field if it had to? Is your company truly efficient? Does it have the talented artists and R&D people required?
If you live in California (or starting here) what can you do?
1. You can work at some of the larger companies such as ILM, DD, etc. These still get large projects but they still lay off massive amounts of people and still go through cycles of feast or famine work so there’s no guarantee of long-term employment even if you’re considered on staff.
2. Consider working at a small to mid-size shop that continues to maintain a reasonable balance of work. Many of these do all television work (which is usually done here or in Vancouver) or that at least do some television work to help balance the work.
3. Consider moving out of country to where the actual work is being done. This sounds like a simple fix to anyone who doesn’t consider the implications.
a. There are already people working there. Are there enough job openings to make it worth moving there?
b. How long is the project? Is this a permanent move or will you have to shuffle off again in few months to somewhere else?
c. Can you qualify to work elsewhere? Many countries require work visas and other paperwork. Some incentives require crewmembers to be living in the country for a given length of time. Just because there is technical and creative work elsewhere doesn’t mean you can just move there and start working.
d. Can you work at reduced wages if that’s the reason the work is located in that country? If you’re at a location that is getting work based mainly on the cost of living can you work there yourself at the reduced rate and feel comfortable? Does the local taxes and other issues reduced the income even further?
e. What happens if you have loved ones, family, house or other connections here? If you’re young and single it may be fun and exciting to move to another location. For those of us with families do we sell the house and uproot all family members (taking children out of school and away from their friends) to go work in another country? Do we leave the family for long periods of time? (6 months to a year or longer) Do we try to rent out the house and hope to return someday?
It’s a sad state of affairs when experienced vfx artists, with all of their creative and technical skills, are likened to migrant farm workers moving to where the work is. At least there’s a real reason farm workers move is because of locations of the crops and growing seasons. In the case of the vfx artist a cubicle is a cubicle, no matter where in the world it’s located. The only reason for moving is purely at the whim of the counties incentives and the studios.
Unfortunately I can’t offer any real solutions. The unions can’t prevent work from moving out of the country. The politicians seem to be the few who have much control over this so they’re the ones to contact. I know that there are some organizations trying to make this better. If you’re in a location doing well then enjoy it while you can. If you’re in California it’s likely you’ll have to do what you have to do. There are now some vfx supes that spend months shooting in one country and then do the post in another country and spend most of the year away from their families.
Will there be enough of a demand and balance that all the vfx companies and artists throughout the world can keep reasonably busy and can enjoy the fruits of their labor?
(Links added 7/12/10 based on VFX Soldier comment posting. See comments for my basic response at this time. The links all make interesting reading and really get to the heart of the matter.)
(If you're viewing this on a page with other posts then please click on the Comments link below to see the comments and responses)
Update 8-9-2010
Every week there seem to be new updates on state or country incentive programs.
Clint Eastwood makes UKFC plea - Entertainment News, Top News, Media - Variety
Here's a snippet:
Scottish-born producer Iain Smith, whose credits include "The A-Team," "Children of Men" and "Local Hero," expressed the need for the government to quickly form a plan or risk producers looking elsewhere to shoot films.
"While we have a fantastic infrastructure, we have to protect that as much as we can and in order to do that we have to compete against industries in other countries," said Smith. "There's no doubt we need to tighten purse strings but we need to be careful we don't asphyxiate the film industry in general."
But in an article written for Blighty's Observer newspaper on Sunday, culture secretary Jeremy Hunt hit back at critics.
"If we are going to face budget cuts I have a duty to ensure that taxpayers' money is spent where it gets the most bang for its buck," he said. "It is simply not acceptable in these times to fund an organization like the U.K. Film council where no fewer than eight of the top executives are paid more than £100,000 ($160,000)."
Hunt added: "Stopping money being spent on a film quango is not the same as stopping money being spent on film."
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"This new credit will give New York post production services a much needed competitive edge," explains Rich Friedlander, co-founder of Brainstorm Digital. "We increasingly saw visual effects post work going to Canada thanks to their their Digital Animation or Visual Effects tax credit (DAVE). This new program will allow work that was filmed in New York to stay through its entire production cycle. It's a major move that will attract and keep top talent here in state."
Thursday, May 20, 2010
Hollywood's VFX Sweatshops
The latest Time magazine has an article on the VFX business. Very worth reading.
"A major point of contention between VFX shops and studios is the issue of change orders. When a director revises what he wants to see in a shot, it can mean months of lost work. Under the current system, most VFX houses feel they have to eat the costs to maintain their relationships with studios and filmmakers."
Richard Keerigan also had blog posting about VFX work here in California.
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