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The Culture of Crisis in Animation & Visual effects

The culture of crisis in Animation & Visual Effects.

I once heard a VFX producer say “I sure miss the days when artists slept under their desks.” Some time later, I heard another one say “Artists are like light bulbs. When they burn out, I replace them.”

How did things get this bad?

You see, once upon a time, there was no such thing as computer graphics. Then some really smart people started figuring out how they could use these huge university computers to draw lines, and then pictures, and then three dimensional objects. After a while they created code that could fill in the lines with colour and even add light sources with shadows. Next came more complex shaders to describe different materials and how they appear under light. Then physical materials and light appeared. This development continues today, but back in those days it was the Wild West. Everyone was a pioneer. Everything that was being done had never been done before. There were no standards and you couldn’t buy either the hardware or the software locally, or sometimes at all. Neighbourhood computer shops were a decade away. The primordial public internet did not yet exist. The cost was enormous to develop the necessary hardware and software for computer graphics. The only companies to afford such luxuries had to be big already with major R&D budgets or access to major external funding.

This is why, in the early days of photo-real visual effects*, a single shot could cost you millions of dollars. Those millions included the hardware and software engineering teams. But movie studios were prepared to pay the big bucks for the capability to make films that, only a few years earlier, had been impossible. They knew this was the dawn of something new. They knew it would draw millions of viewers and sell millions more tickets. VFX budgets quickly became enormous. It was a crazy time. Nobody really knew how to do anything and tools development was essentially hand-in-hand with shot production. Nobody knew how long anything would take. Deadlines had to be met, so engineers, artists, team managers all slept at work to make delivery—sometimes for days or weeks. In those days we can imagine how exciting it must have been to be at the dawning age of computer technology. We can see why people were so driven and excited by what they were accomplishing. Yet even with the drive, the excitement and the pioneering spirit, team members became exhausted, demoralized and depressed. All humans have physical limitations and those limitations would be hit at unexpected times, sending schedules into turmoil. This was the beginning of the culture of crisis. These were real crises, created (or rather charged into) through the desire to create new, amazing things that nobody had ever created before. It was tough work but was also like magic. The engineers and artists became rock-stars; wizards. The problem was these tech-magicians had families too. They had lives and loved ones. Many became fatigued by the constant, insatiable corporate demand and began to long for a day when they could strike out on their own, maybe have a better life doing the things they loved.

Within a few years, Personal Computers became available, making computing far more accessible to far more people. The special hardware for computer graphics was still enormously expensive and 3D software was still unavailable to the masses, but it was coming. You could smell it. VFX companies continued to develop their tools, improve, perfect, simplify. Development was enormously costly but they knew if they could find a way streamline their tools; if they could get to the point where they didn’t have to write tools from scratch, or modify them for every shot, if they could re-use their R&D to do things they had already done, shot costs could be brought down. Profit margins could be improved.
Then a funny thing happened. They succeeded. These companies, now with reasonably well developed tools, were able to create visual effects shots for less…a lot less. The software tools had been developed to an early state of generic usefulness. The hardware was becoming less expensive. Development had to continue, of course, because there was always something nobody had ever done before and there was always the competition scrambling to keep up or to get ahead. Interestingly, the drop in development costs didn’t inspire VFX companies to reduce their pricing. They continued to charge millions. You can’t really blame them. They were the ones with the vision, resources and drive to get it done. They were the ones who brought a technological revolution to film-making. They took the big risk and they deserved the fruits of their labours. I don’t think anyone can argue with that.

Then something else funny happened. Not satisfied with the enormous profits rolling in from VFX, they decided to package and monetize their software. Imagine how much more profit could be made by selling their software to others! In hindsight, it appears they sold their secret weapons to their enemies. Their enemies bought the secret weapons and started using them. About this time, the cost of PC hardware had dropped to the point that an individual could purchase a powerful enough home computer to support a 3D Graphics hobby. Watching these events carefully were groups of disenfranchised VFX employees and ex-employees who’d had enough of the culture of crisis. These artists and engineers, tired of the corporate game, the endless demands, the lack of appreciation, now had all they needed to start their own little company and get into the market. One day they gathered a small amount of capital, bought a few computers, some software and started playing their own game.

Because they were small, flexible and capable, they quickly landed small jobs by underbidding the big companies which didn’t take the competition seriously and refused to alter their price structure to compete. They didn’t think a few upstarts could really get much done. They were dead wrong. These little companies grew quickly and began to multiply because the demand for VFX was huge. The market was wide open for new, smaller, less expensive companies.

These new companies started basically printing money. Even charging 25% less than the big companies, their overhead was so much lower that they were making an embarrassing amount of money in a very short time. They grew quickly and took on larger projects. But there was one really significant problem. These were, for the most part, not skilled managers. They were artists and engineers. They had never run a company before. They had little or no team management skills or training aside from what they picked up by osmosis. They didn’t understand the importance of time and task management, employee skills development, cost control, human factors such as workplace health, fatigue levels, ergonomics, family obligations; labor law, business ethics and a hundred others. Problems arose due to management inexperience. The larger the project, the larger were the problems that arose. Project management was, and remains, a long list of very important skills that needed to be taught and learned. Without the skills you are….well….you’re in a crisis.
So crises started occurring. The owners began demanding more of their crews. Overtime, all-nighters, weekends. The managers said things like “come on, in the old days we used to work all-nighters to pull of this or that effect. That’s just how the industry is”. Oh the irony. VFX producers started saying things like “I miss the days when people slept under their desks”.

Add to this another factor. PCs and software became so ridiculously inexpensive that almost anybody could spend a few thousand and start freelancing from home. The cost of VFX plummeted as competition grew from more small companies. The bigger the company, the harder it became to compete…with one exception. The really big companies where it all began were aril run by experienced managers and business people. They manage. The studios that started dropping were the ones formed by artists and engineers, the ones without strong business management; the ones that weren’t exactly small any more by also weren’t quick a “big” company yet. Now that they were competing with small, flexible companies and individuals for the small jobs and with well-run big companies for the big jobs, they were no longer seeing the enormous profits of the golden years. Their missing business and management skills really hurt here, because they hadn’t been looking ahead. They were not prepared for the fallout of the computer revolution.

Then, something that any decent business manager could have foreseen years ahead — something that has happened many times before throughout business history– happened unexpectedly in the VFX industry. Business began to globalize. Because the hardware and software to do VFX has been freely available on the market for a while, businesspeople in other countries with different economic realities have realized they can attract certain exportable aspects of the business. Standalone work like rotoscoping, matchmoving, wire removal and so forth don’t need to be done in house. They’re usually a department of their own anyway, sometimes in another building with network connection. Why not in another country, another time zone, another continent? According to the producers there was no reason at all not to do it and every financial reason to give it a go. After all, if you were a producer and your job was to limit and protect your budget and you had the choice to pay a local artist $300 per day to do wire removal or to pay a foreign artist $10 per day to do the same work, what would you do? You’d do your job, of course. It’s not your job to worry about what’s “fair” or “patriotic”. It’s not your job to be protectionist or political, nor to look at the socio-economic fallout of your business practices. It’s your job to limit and control costs and to follow the law and that’s what you do. You live in a country where you are permitted to do business with foreign companies. You live in a free market economy. Your company is trying to maximize profits by minimizing costs, so that’s what you do.

As numerous small companies, local and international, started to saturate the VFX market, a bidding war began. VFX prices started to drop. Medium sized companies that didn’t see the coming change went quiet, then downsized, then disappeared. VFX prices continued to drop dramatically. Companies, becoming desperate for business to keep the lights on, began charging cost. Some even charged below cost, hoping to outlast the competition.

Because of this near-sighted, reactive practice, the bottom drops out.

This is a harsh, new financial reality for the industry. Gone are the huge salaries for the “computer wizards” who made the early, impossible, magical computer-generated visual effects. Gone are the heady days of massive profit. Some companies begin demanding free overtime from employees in an attempt to generate more work for less cost, perhaps setting a 10 hour standard day without OT pay, illegally. This backfires and actually costs VFX companies more, although few, to date, have done the math to figure it out. They’re too busy in crisis to complete cost analyses.

Many companies cannot adjust to the new reality and fail. Others struggle on, hoping they can hold out until the market hits bottom and rebounds, trying all sorts of business models to keep the doors open including highly unethical practices like having students pay them to do their professional vfx work and calling it “training”. Outsourcing as a cost reduction strategy becomes a business necessity. Foreign service companies thrive. Early on, this causes massive scheduling problems as quality expectations are not met and communication through time zones across the globe is problematic. Crisis after crisis arises in an attempt to deal with immediate problems while few look to the future (in which outsourced work becomes high quality and more work goes there). In nearly all cases, however, crisis has become such an ingrained part of the operation that nobody looks at it as something that shouldn’t be there. Most people just throw up their hands and say “Well that’s just how it is in post.” They justify constant crisis with remarks like “It’s a creative process. You can’t predict what will change”. These are the nonsensical words of non-managers in management positions.

One of the biggest and most ridiculous problems today is that thin margins make VFX companies scared…so scared that they’ll do whatever the client wants just to keep the doors open. They won’t risk annoying the client with inflammatory remarks like “If want us to add a photo-real unicorn it will cost more. Here’s the bid for a photo-real unicorn.” Imagine, for a moment, instead of a VFX company, you own a grocery store. Now a client comes in and picks up a bunch of groceries. While you’re ringing in the groceries the client says they want you to throw in a couple of prime rib roasts, but they’re not willing to pay anything extra for them. The client says “If you throw in those rib roasts, then I might come here next week and do a really huge shop!” Now imagine yourself agreeing to this. And you’re not allowed to ask questions like “What size of rib roast would you like?”

I have actually witnessed a Producer say “You can’t ask the client a question, or it will look like we don’t know what we’re doing!” (which is ironic since if we don’t ask questions then we actually don’t know what we’re doing). This is classic panic-mode. It bears noting that, although you may frequently be promised more work if you do This Big Favor free, there is almost never more work. After you hear that promise one or two hundred times, you’ll realize it’s just a negotiation tactic with no intention of follow-through. Every time a VFX producer agrees to something like this, the client hangs up the phone, chuckles and mumbles “chump”.

In today’s culture of crisis, in a misguided attempt to deal with these factors, managers routinely run massive overtime. Ironically they still sleep well at night because they have come to believe they have an innate right to your whole life. Evenings, weekends, all-nighters…whatever they need. They believe if they demand the time of you, you have no choice but to give it. And if you don’t give it, you are not a team player. Some will deliberately play team members against each other to guilt you into staying an extra few hours for free. “Well Jason and Bob are staying, what’s your problem?”

Your employer expects you to sacrifice your health and family to make entertainment which, when you think about it, is really content to sell commercials. We have become so accustomed to running in a constant state of crisis that we no longer think of it as a problem. It’s just the way business is done. We will damage or destroy our health and family to sell cars and dog food.

If we were to take a moment and imagine these conditions in, say, a bread factory or an accountancy firm or a dentist’s office, we’d just laugh. It’s ridiculous to imagine a dentist insisting the rest of the dental team work until midnight on Friday and through the weekend with no notice or extra pay otherwise they are not team players, otherwise they might be fired. Aside from the moral, legal and ethical problems with this approach practice, it’s just comical. Why aren’t we laughing in our employers’ face when they make these demands?

We should be.

*Visual Effects means computer generated elements made to look real. Cars, dinosaurs, spaceships, buildings, tornadoes, anything. Often mistakenly interchanged with “FX” which is explosions, flames, smoke, dust etc…

Nicholas Boughen is a VFX Supervisor, CG Supervisor and VFX School owner who has worked in the entertainment industry for 34 years as a team and facility manager, project manager, trainer and artist.