fmx ’11, Day Three

The morning was worse than I had anticipated it, I don’t quite remember how I got to the venue today, I only remember that I didn’t even get tea for breakfast. The Haus der Wirtschaft was buzzing like a hive again and most of the bees hat been busy at the Echtzeit party that lasted roughly as long as my writing session for yesterday’s blog post. Even worse: Those people seemed much better rested. Life is unfair.

I stumbled between the rows of the darkened hall as some animation’s credits were running and got my favorite seat to watch a couple of really funny Wily E. Coyote-like animation shorts about Mr. Hoppe, trying different approaches get rid of a barrel of atomic waste that always backfire. There were a bunch of lovely ideas involved, so check out the website!

Know the Past, Conquer the Future

Shortly after Eric Ross introduced the founder of Digital Domain before he sold it to director Michael Bay and a bunch of investors, so he was in the business right from the start on the other end of the spectrum, not an artist but a producer and manager. How he felt after being in the industry for thirty year? “Boy, am I tired!”

“I am going to talk about the past of the VFX industry a bit because it is important to know where we all come from.” Scott joined ILM in the middle of the 1980′s when the company was working on “Innerspace”. What surprised him, was that in fact very little was done on the computers. It was the time when companies had in-house teams (such as Pixar) to develop computers for specific tasks, so called transputers. Since Scott originated from a wold of optical printing and the telecine he thought “that wouldn’t it to be wonderful to bring that to the computer?” At ILM, John and his brother Thomas Knoll started developing a program for doing composits on a Macintosh computer, a program that what would eventually become Photoshop ¹. “But rendering was still a big issue and it only got feasible until we got us some Pixar cubes², which were used for the VFX on The Abyss³. And today? There are probably more colleges that provide VFX education than there were people in the VFX industry in the early 1990′s.”

Scott continued that historically not so much is known about the producers and managers behind the artists of the early days, although somebody “fighting off the client so the artists could work” is just as important. Oftentimes, he lamented, the industry is not really that much interested in the business of VFX. “If you wanna be only an artist then cut off your ear, move to southern France, eat cadmium yellow paint and have a good time!” he joked “In our business it don’t mean a thing if it don’t go kaching.” — simple as that.

But he made clear that the business people are out to suck out all an artists creative power, rather to empower them instead by providing infrastructure, time and the opportunity to individually make a living with their craft. “Well managed companies can always pay all of their employees’ hours all the time.” That made me remember the unpaid overtime I oftentimes did.

History

Scott continued painting the big picture, what companies were founded at what time, and what stages they went through, like the first generation VFX divisions that were all created out of the needs of a single project such as Industrial Light and Magic (which spawned Pixar later) was founded for the purpose of creating Star Wars; Douglas Trumbull created the Future General Corporation for Steven Spielberg’s Close Encounters of the Third Kind and Rob Abel founded Robert Abel and Associates (RA&A) for Star Trek. All that happened in the 1970′s.

The second generation facilities were founded mostly by people who were fed up “working for the man” and decided to start their own companies. Rhythm and Hues was founded in 1987 by six former RA&A employees, Richard Edlund’s Boss Films, John Dykstra’s Apogee, Inc. and Scott’s Digital Domain were all companies created from former ILM guys who had a “religious problem” with George Lucas, as Scott put it: “He thought he was god, and I disagreed. So I started my own church.”

The next wave were studio owned VFX divisions that would open and close and open and close, depending on whether they were needed for a production or just were unprofitable such as Buena Vista EFX. Warner Bros. Digital is now closed, Sony Pictures Imageworks costs the studio a lot of money but they produce very well grossing features, or The Secret Lab that used to be Dreamquest got closed after Disney’s Dinosaur bombed.

Of the 3rd, 4th and 5th generation facilities some made it until today, such as Weta Digital or Method Studios whereas many didn’t (The Orphanage, Station X, Asylum, Café FX, etc.) or as Scott put it: “The highway is littered by dead bodies. For a successful business you need to understand the business aspect as well as the artistic and the technological aspect. And still, that might not be good enough.” And a good name is also important. “Somebody back then suggested Digital Domain, whereas I wanted to name the company Presto Digital-tation or something like that. I’m terrible with names… I have three children but I won’t tell you their names” Scott said with a smile.

And today? There are mostly studio-owned companies that produce full CG movies, which turned out to be highly successful: Disney got Pixar (“Toy Story”), Fox owns Blue Sky Studios (“Ice Age”), Dreamworks acquired PDI (“Shrek”) and Sony has Sony Pictures Imageworks that currently delivers high-end VFX. The advantage these companies have, is that they provide the content creators with all what is necessary such as distribution, marketing and licensing. Still, “content is king. Making and owning content will do you right” Scott is convinced.

The crux with today’s high-end VFX and CG production is that it does not happen in a free market environment. “In VFX, the consumer has no vote, s/he can’t say I am going to pay $15 to see a movie by Sony!. Instead the studios control the business, which means that when you have a VFX facility you have these six clients worldwide.”

The thing is, though, that the facilities are not profitable, as said before for a number of reasons: You can’t see long ahead if and when there will be which amount of work. Then, it is difficult to price VFX since everybody is constantly asking for something new that had never been done before which make it impossible to compare. What is really hard on the US-based facilities is the subsidized situation in the UK where VFX companies are basically spared from some taxes by her majesty. The cost of labor has steadily increased (which is at least one good thing for us artists) so when an artist got an annual salary of around $40k for the work on The Abyss the same skill set and expertise earns you today a healthy $200k to $250k per year. Broken pipelines are another issue that might cause great damage, technical prowess, managing the client, next-gen facilities, capital investments and satisfying the management’s expectations — that all costs money.

What grosses money today

The 80′s were dominated by a film star scheme that worked really well: Have a familiar name on the poster and you were certain to get your revenue from it. As Scott showed the top 20 grossing movies of all times there were only three of them starring a movie star with appropriate pay: Johnny Depp. Almost all the others were features heavy on VFX where the lead roles didn’t make a difference, “VFX and animation mean everything today!” Scott tried to motivate us. I know that I had really gotten worried on how the industry is headed right now. “The new film stars are you, your work gets shown in every trailer, not a witty dialogue by Tom Hanks, the images you create people want to see and pay for!”

In the end Scott talked about the Korean film “The Host” that was incredibly successful in Korea and Japan, “but if it was produced in English with a slightly more Western structure in the narrative it could have made twice as much internationally” he concluded and was running out of time on this extensive lecture so he jumped through the importance of outsourcing and spoke a few words of warning, that the low-cost content providers will become the provider of services in the near future — like it or not.

“But there is a bright future for you as the content provider, because, again, content is king!” he said. With the new models of distribution with the internet the current system of the Big Studios can easily change. “There is a bright light at the end of the tunnel. But it could also be the light of a train. You need to find a place to fit in, and don’t think that everything is gonna work out like roses, because sometimes it just does not.” I was irritated by the mixed messages I received from his lecture. And all that without coffee made me feel like Garfield on a Monday morning.

Oh, and here are two interesting facts from the presentation I could not find a place to fit in the text above:

• Scott played the cowbell on one Jimi Hendrix song. Funny story.
• Monkeypoints is net-profit on a movie. Since the studios have clever ways of shuffling and hiding the money a feature makes, it practically means you never see a dime; whereas First Dollar Gross means a percentage of what is made at the box office.

Going Global, Pt. 2

I remained in the König-Karl Halle because I was too exhausted to move and so I sat there and watched the panel that was up next. Eric Roth moderated the discussion Global Production from the U.S. point of view among the illustrious round of industry leaders and professionals. On the podium sat Jeff Okun, VFX Supervisor and chair of the VES; William Sargent, the founder and CEO of Framestore, Dan Glass, Executive VP and GM of Method Studios/CIS and Lee Berger, the President of Rhythm & Hues. I tried to note down their respective views and opinions on the topic.

Lee Berger stated right in the beginning that 90% of the costs is labor and if you want to stay in business you want to cut the costs by retaining the quality. And outsourcing is a way of doing that, in the case of Rhythm & Hues about 30 to 50 percent of a project is worked on abroad. Taking William’s statement “in the end it still comes down to the price” into account, Eric Roth asked if this was going to become a race to the bottom of the price. “Definitely. But you still don’t want to cut any corners quality wise. India and China catch up in quality pretty fast and will soon be able to deliver the same quality. And we do whatever we can to keep the prices low.” As brutal as this may sound, R&H still managed to stay in business for 24 years and counting and always managed to pay their artists.
A question from the audience was asked whether this fragmentation will continue to a level where the artists work on a powerful system from their homes and exchange via the cloud. “That would be too fragmented for productive and creative work,” Lee explained. “It is already happening for tasks like roto where you pay somebody $50 for it, but for creative tasks it just won’t do, you need to be around each other.”

Dan Glass considered taxes and subsidies to be a huge factor for where in the world to produce VFX, but also the skill set teams is important. “We want our teams to be self-sufficient, being able to work on sequences independently. We don’t split up tasks.” Apart from filmmakers still pushing for high quality and not accepting mediocre VFX, he also talked about the development that low-cost labor will not remain low-cost forever, so you always need to be vigilant about the global fluctuations and tendencies.

William Sargent was rather pragmatic in his view as an CEO of a big company, and stated that “in the end it still comes down to the price”. But in his eyes the globalization doesn’t really mean shipping jobs abroad, instead just growing abroad. Framestore also operates an office in New York, “but since New York is the center for commercials we just wanted to be near to our clients there.”
Nowadays you get paid for what you can deliver on a per-project basis, nobody wants to pay for the R&D that goes into the steady creation of something that has never been done before. But a positive development in recent years is that the VFX houses have become part of the discussion. “Clients say: We have $ 5 million and want to do this. Is that feasible? How can you help us achieve this?” In Williams’ opinion, the VFX industry has the best organized and still most flexible part of any production, “things can virtually change over night and we can react to that.”
Eric asked if he gave William $50 million, would he found a VFX facility again?
“There’s definitely an easier way to make a living than to start a VFX facility, but this is just where my passion lies. And with $ 50 million you wouldn’t open a VFX studio, you would start a project instead and maybe found a small VFX studio in the wake.”
But is being a small VFX studio with a better profit percentage preferable to a bloated system? “Well, you need a certain size to being able to obtain and finish some projects.”

Jeff Okun saw the change toward a global industry in bright colors and as an opportunity for the creative: “We are the migrant film workers,” he continued, “I didn’t get into the business to win an Oscar but I love figuring ways out to do the impossible and I don’t hesitate to take my family with me and go where there are opportunities. I lived half a year in New Zealand, six months in South Africa, six months in Thailand… I don’t think geography is that important anymore, it doesn’t matter. The only reason the industry is still so US-centered is because it’s where Hollywood grew and became the center of it, where everything used to be in once place. The US is a sad place right now, a lot of bullshit going on.”
“Embrace the change, change is good. It gives everybody the opportunity to fix things that are broken. This is a good age to be a student and a good opportunity for a do-over.

Fun fact: Bill Kroyer sat in the row next to me, a book with the colorful cover next to him (CG101: A Computer Graphics Industry Reference, 2nd ed.) and I was racking my brains to think of something I always wanted to know about the original TRON because I’d probably never have the chance to ask him again anytime soon if ever. In the end I nodded off during the Q&A session in the end. When I woke up, Bill was gone. Damn!

Outsourced

The next session of that day’s focus on producing global was held by Philippe Gluckman of the DreamWorks Dedicated unit who had started as a supervisor on Shrek and was at PDI when they got acquired by DreamWorks. In his presentation he talked about the struggles, surprises and success of building a DreamWorks animation studio in Bangalore, India. “So basically what we tried was to apply the same process of unification that was going on when PDI merged with DreamWorks.”

In May 2008 the studio in Bangalore was opened in cooperation with Technicolor that already operated from the same tech park. The studio “opened” in a sense that it was lacking employees and equipment but the premise were ready for them.

What was the goal for DreamWorks’ Indian unit? Cheap work? Low expertise work? Philippe made it clear that was not the case. “We wanted to make it the equivalent of PDI with the same level of quality.” Then he showed the studio’s demo reel with various Madagascar or Shrek themed seasonal TV specials. To me it looked just like the movies. “The only thing that’s different so far is that we don’t make or own innovations, we just use the techniques that PDI already acquired.” But what the Bangalore studio does not do is recycle already used sets, because it doesn’t quite work and in the end you spend more time making an existing set work in a new context than building a new one altogether.

Training

“We needed to train the local artists with our software first. It is proprietary and different than what the artists are used to. It has no full documentation and takes quite a time to get comfortable with.” But the training also needed to be broader than just teaching the tools. Some also needed to brush up their English and the leads were sent to the US, just as some people from the US were sent to India. “Our artists really enjoyed those visits and loved to be exposed to the top people of their field, they wanted to soak up their knowledge like sponges.”

Culture

What about the cultural differences? “The people weren’t used to the freedom we gave them: Instead of urging the animators to churn out a shot each day we gave them six weeks for it. But what sounds like creative heaven at first also needs to be seen in perspective: You need to figure out a way of working that fits you and that you are able to constantly improve on your shot. To keep this level of quality we ask much of our artists but they reward us every time.”
“At PDI there’s a culture of voicing you opinion and exchange so you also need to see criticism as opportunities, not threats. In the beginning it was difficult to get the artists voice their opinion and to be as forthcoming as would like them to be and pitch their shots before others. They got used to Tell me what you want and I do it exactly as you say. That is not how we do things.

The time difference of twelve hours soon made it obvious that there were only limited opportunities for reviews from DreamWorks in California. Since the studio felt like a start-up, sometimes people got promoted to fast into leading positions they did not feel quite ready for.

Technique

Technically there also were some challenges waiting to be mastered: “There was no person in India that lights the way we do. We don’t have a compositing department, everything happens in the renderer so we really had to train people first.”

Also the matte paintings in the trademark DreamWorks style were too uncommon to find a talented artist right away since they are not photo-real but much more detailed than a concept painting, they lie someplace in between.

In practical terms also the look of some elements resulted in different comprehensions, as with pixie dust. “Magic is terribly hard to get visualized because it is highly subjective compared to, say, water.” The Bangalore studio also animated clips for a DVD menu that asked for a fully deformable yet still fully loopable fire, which posed “a tricky but interesting task.”

The Future

DreamWorks’ goal is to have a studio in India that is capable of developing and producing a full feature with the quality standard of the headquarter in the US. “And this happens right now in Bangalore.” Philippe closed before showing some personal photos he took of the people he met on his exploring walks around the tech-park.

WALL-@

Again my caffeine batteries were empty, my low biological activity almost drained as well and it was hard keeping my mental focus. And to my knowledge there is only one medicine⁴: COFFEE! So I tried to get out and to the other Starbucks as fast as possible to avoid long queues. I finally arrived, merrily ordered a salami bagel and a caramel macchiato and reached for my wallet. It wasn’t there anymore. I looked incredibly stupid at the barista “I lost my wallet.” I uttered. This was not happening, I thought, there was everything in it! “Tough luck. NEXT!” he replied and I traced back my steps. Vanished was my exhaustion, exchanged for a cold panic with sprinkles of irrationality that made me text my beloved Conny who was hundreds of kilometers away and couldn’t do anything about the situation apart from sending a reply: “Oh no!!!!”. Back in the König-Karl-Halle at my seat there was nothing. I asked the technicians, they didn’t have a clue. I went to the info-desk and ask whether a wallet had been found. “Yes. What name?”. I showed her my ticket and she handed me my wallet. Even the money was still in it! I was so relieved I babbled like a madman about how relieved I was and sent an all-clear-message off to Conny. I went back to the coffee shop with a fresh boost of relief-induced energy and placed the same order at the same barista. “I hope you can now pay for it” he replied with a smirk.

Why did I tell you this? Because you should learn from my mistakes: Don’t hog so much loose change that your wallet gets so heavy, it falls out of your back-pocket when you try for three hours not to fall off a chair.

Forged Cutting Edge

The morning was worse than I had anticipated it, I don’t quite remember how I got to the venue today, I only remember that I didn’t even get tea for...

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