Is the Visual Effects Industry Dying?

I watched the Oscars last week for a total of about 20 minutes before deciding to do something imperative and productive, like trim my toenails.

What was more intriguing than the Oscars or my self-pedicure was not happening inside the Kodak, or I mean, Dolby Theatre, it was actually occurring a few miles east on Hollywood and Vine: a protest arranged by members of the visual effects community.

One would assume that an industry that relies so heavily on visual effects that business should be booming for these companies. So It’s confusing when award winning companies like Rhythm & Hues files for bankruptcy, or when Pixomondo closes offices in Detroit and London. These VFX houses are the latest in the long line of casualties. Is it the Darwinism of the free market? Or is it just bad business policies? Lets declare it’s a little bit of both.

If you take a peek at this months theatrical releases, it’s safe to assert that the majority, if not the entirety, of these films used some sort of visual effect. Now, it’s unrealistic to think that one monolithic VFX house could handle a workload of that size. That’s why there are more VFX studios than there are bullet holes in Sonny Corleone. This competition should be valuable for productions and VFX studios alike, since additional competition should equal lower costs for the consumers, and that also creates relationships through communication. But alas, this isn’t reality, this is Tinseltown, and like William Faulkner once said, “Hollywood is a place where a man can get stabbed in the back while climbing a ladder.”

VFX companies typically use a fixed price model, meaning the estimated cost for working on a production is not negotiated, instead it’s a flat rate. This allows film studios or film productions to bully and short-change a visual effects house. Creative fields shouldn’t subject themselves to operating with a set fee, it’s never too late to improve one’s bargaining position. It pains me to defend the studios, albeit ever so slightly, but if you concede by letting them walk all over you, they will continue to tread, and they won’t even have the common decency to wipe their feet.

There are methods around this system if you prefer not being speared while gazing upward. For example, Best Picture nominee, Beasts of the Southern Wild, decided to use students from San Francisco’s Academy of Art University to assist with the visual effects during post-production. Creatively applying the use of free labor allowed Beasts to be made for less than $2 million dollars. In addition, an acquaintance of mine, Director Nicholas Acosta, not only directs, but also edits his own material with affordable VFX software. This permits indie filmmakers with inferior (at times, on par) resources and less assistance to compete with the visual effect industry.

Perhaps creating their own union could solve a portion of the problem, yet it appears collectivism is what got them in this conundrum in the first place. Tax credits do attract and benefit productions, principle and post. But flipping the bill on taxpayers isn’t sustainable and eventually the funds run dry. California Governor Jerry Brown has extended its film tax credits, and supposedly, we are on pace for a budget surplus next fiscal year. Although, our repeat governor has fibbed before.

Since the technology is forever advancing, I don’t foresee VFX becoming extinct. I don’t know if there is a panacea that will cure the dilemmas facing the visual effects community. What I do know is that Hollywood is a fickle place filled with sharks waiting to chomp on pasties, the middling, and alternative predators. Whatever the answer is, VFX better swim or, well, you know the outcome.