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Why Rhythm & Hues? And How Do We Keep It from Happening Again?

UPDATE: 3/29/13. I'm told that I stirred up some rumors about which studio I was referring to when I mentioned that I knew of a VFX house that’s about to incur a loss on a project. I got the information from a well-connected and highly respected industry source who is a 20-year friend. He declined to reveal the name of the house, and I didn’t ask him to. I have no direct knowledge of the situation and should have made that clear. Anyway, the spread of unfounded rumors is counter-productive, and I thank everyone who contacted me directly about this. Let’s continue on with the fascinating conversation below.


I got sick to my stomach when I heard that the venerable Rhythm & Hues was going bankrupt. Sure, there's been a lot of speculation about what went on to bring R&H to its knees. I've said elsewhere that it collapsed from within due to heavy overhead. Well, I was only a tiny bit right about that. Finding out what really happened has been difficult. I've managed to have conversations with a number of people in positions to know who wish to remain unnamed. I've gotten diametrically opposite opinions at times and had to seek third- or fourth-party input. In the end, what I have makes sense, and I've shown it to knowledgeable people and asked if I was being reasonably correct and fair. After a number of revisions and re-writes, I'm quite certain this is what happened. Be aware that I have long been a fan of R&H, but I have done my best to remain objective here.

First, for decades R&H has treated its core people extremely well. To my knowledge, John Hughes has a great respect for artists and to my observation, he can even go overboard trying to treat and pay them fairly. R&H has managed to be a globally expanding enterprise for about three decades. Many thousands of VFX artists have been trained there, spent their careers there and changed their lives for the better because of R&H around the world.

Once you've proven yourself — I mean talent, work ethic and loyalty — you become a core employee. Like any VFX house, R&H also hires project people – freelancers. These are the nomads of our industry who go from house to house as the work is available. They represent the majority of VFX artists. Over the years, R&H has accumulated a fair number of core employees. They are loyal to the company and the company is loyal to them. That, dear readers, can lead to a lot of overhead expenditure during the slow times.

A Going Concern for Decades
Still, R&H has managed to remain a going concern. Add to that a great health plan. Vacations that start at three weeks and go to six weeks. As I recall, in the old days people could accumulate vacation at R&H without limit. And at one time their medical covered such things as alternative medicine and cosmetic surgery. Add to that, they still have four-week sabbaticals every five years, in the belief that artists need a creative break. Some of it had to change, of course, and R&H revamped its benefits a few years ago to keep things under control. So R&H has been feeding back a lot of their income to support their artists. You do not hear of this kind of thing very often. I'm more likely to hear about sweatshop conditions at other studios. After much research, I can honestly say that I don't believe it was the benefits package that caused the problems. Also, the vast majority of their artists are freelance and are laid off when there is no work for them. So that wasn't the problem either.

R&H has been a profitable business with a five-year average EBITDA nearly twice what I've been told is the average for the industry. That's pretty damn good, considering they had about 1400 employees worldwide before the bankruptcy that they had to keep paying.

Clearly they don't work cheap, but they can deliver what few other houses can. They maintain their own flexible, adaptable in-house pipeline development team and proprietary software. Their virtual animal work has always been groundbreaking, and Life of Pi's tiger is proof positive of that. They have been pioneers at taking advantage of various government tax incentives and training their own staffs, creating jobs in India and Malaysia and Taiwan. I personally know they do not exploit their people there. In fact, they help people build wonderful new lives. I will say that they did not have incentives in India, but took advantage of the economy to create local high-paying jobs that produced reasonably priced VFX.

I have a number of dear friends working at R&H abroad. So in my opinion this house has been doing many of the things I've been preaching for a long time — all the key elements for survival in this industry. So I had to dig deeper to find out what in hell was going on.

Digging Deeper
I did find a number of management inefficiencies and policies that might be improved, but in general it looks like R&H was able to function well as a business. The company's longevity would reinforce that impression.

But then I discovered that there was a major difference in what went on at R&H during 2012 and early 2013. Remember that R&H has many parallel shows running in production at any one time. Sometimes there are delays caused by factors beyond their control, usually studios. Studio delays are a vice squeezing the life out of any VFX house. Why? Because you have to maintain the crew.

In this business, if you let part of a well-honed crew go, you're not going to get them back. Also, the kind of shows R&H was fielding required top talent. Core people. People who know their pipeline. They were big shows, primarily run on Houdini pipelines that were customized and fine-tuned to each show. That meant R&H maintained a sizable Houdini team with development and support programmers. Plus they had to maintain their own proprietary tools teams, as well. These are full-time key individuals that had to be dedicated to these specific shows.

You would think the studios would have to pay for their delays. After all, it causes the VFX house to incur significant additional costs. But lots of luck with that.

From March of 2012 until April of 2013, R&H experienced devastating six-month delays on two major in-house shows. Add to that four-month delays on two other very large shows. From what I've been able to piece together, each of those four shows had between 150 and 200 people dedicated. I suspect they could have let some of those people go, but R&H rarely does ordinary VFX. They do the hard stuff, and you can't just hire anybody to come in and do it. They needed their special people.

Lets talk about what that costs. Consider those 150 and 200 artists on each of these shows. Total cost per artist, including overhead, is about $2000.00 per week. That is between $1.2 and $1.6 million per month that R&H had to eat. And so it was that R&H developed a cash-flow problem. They were out of pocket between $25 and $30 million dollars to pay for studio delays. Ouch. How much sense does that make? I don't know of any house that could sustain those kinds of losses and survive.

R&H may have made some mistakes here and there, but none of them would have jeopardized the company. But the fact that studios can cause massive delays on critical projects with no penalties is insane. That has to change if this industry is to survive.

Studios watch the bottom line very closely on their own premises. When costs start soaring due to delays on a studio shoot, the execs put a stop to it quickly. So when a director wants the same VFX shot done dozens of times over, he should have to pay for that. Worse, when a director comes in after four to six months of hard work has already taken place on a series of shots and changes the entire design, all that work is shot. Now, the house had to bid on that shot at a fixed price. That means they have to eat that loss, not the director and not the studio. R&H has experienced these kinds of situations lately also. All of it makes it difficult for any VFX house to stay afloat, no less make a profit.

Client-Side VFX Supervision
This part isn't specifically about R&H. I've seen it too many times and feel I need to comment. Sometimes there is one person behind the many delays and do-overs and all the stress. This one person can cause millions in losses for a VFX house with no consequences at all. It is the dreaded toxic client-side VFX supervisor. There are only a few of them, but they wreak havoc on the houses and make people's lives miserable — and I am betting they contributed to the downfall of R&H.

I don't mean to imply for one second that client-side supes are generally bad people. On the contrary, some are amazingly good and are helpful to the houses. In truth they run the gamut from fabulous to toxic. I know at least four fabulous ones and two who are poisonous. The bad ones are, in my opinion, seriously compromised individuals who should not be in such a high stress job. They definitely should not be in a position to cause VFX houses losses. These people are the arm of the director that can make a show go smoothly, or they can precipitate devastating losses for the VFX house by insisting on doing shots over and over and over, sometimes more than 100 times, for no good reason. I've looked at rejected shots that were perfect. There appears to be no penalty for this destructive behavior. They are often not nice people — nasty, often pulling power trips at work, while seeming normal in private.

I will say the best ones make the job run smoothly. They work well with the VFX houses, and it's not an easy job. They keep the budget in mind and only ask for the changes that are needed. They may even get the studio to agree to a change of scope where needed. So much of the problem boils down to a few individuals causing major problems. For some reason, they keep getting jobs. (I'm actually thinking of publishing a list with my awards for best and worst client-side VFX supervisors. My ass will be in trouble because I have friends on both sides, and my kids will be all over me about it.)

Here's a heinous related detail that is killing VFX houses. I know of a studio that will be delivering shortly, two months late because of delays. This house will be losing right around a million bucks because of it. Here's the thing — studios will often get magnanimous and pay for an extension of the production management for the show. Big deal. They won't pay for the artists, who are the bulk of the cost.

Although many vectors enter into a bankruptcy, and R&H could have done a few things differently, it is this systematic lack of accountability on the part of studios that appears to be the single crippling factor killing the VFX industry. That's what forced R&H into bankruptcy.

What We Need to Do
Okay, we need a plan. The way things are done now inflates costs for everyone concerned, including studios. Everybody has to add padding to cover their asses, and the directors, client-side VFX supervisors, and studios have no incentives to try to be efficient with outside vendors. Why? Because they usually have no penalties for changing scope or irrationally rejecting good product. I know of no other business that runs like this, including the movie business. Not anyplace but in VFX.

We need a set of best-practice operational conventions that will stabilize the system from studio to director (really, all the creatives on the client side) to VFX house to studio.

  • Studios and houses need to agree on a residuals plan so there is a flow of money to houses for work already done that is currently reaping box-office rewards.
  • A two-way penalty system should be instituted between the studio and the VFX house, where the studio has to pay for causing delays and the houses get docked for delays that are not the fault of the studio.
  • Studios should be required to pay for all changes of scope, and get refunds for reduction in scope, so long as those reductions are done prior to the work being started, except in cases were assets had to be irretrievably committed.
  • A confidential channel should be created through which houses can report toxic VFX supervisors to studios and request a replacement.

There are other things. But if we got these, I'm willing to bet that 90% of VFX house failures would be eliminated, with just the really badly run ones collapsing. Wait — they already have!

How We Do It
We build a strong state and possibly national lobby. We may need a trade organization, but one that is focused on getting the studios to work with the houses in a fair and equitable manner. Forget lobbying against subsidies. That's a different matter for another day. It should focus on the development of best business practices.

These are well-known in the business world. You don't, for example, sign a fixed-price contract on a virtually undefined task. But I digress.

I think we need to have the lobby work towards legislation favorable to keeping VFX houses in California and especially in Los Angeles. That legislation should in some way regulate fair business practice in contracting between studios and houses, breaking the high-handed, monopolistic approach currently in practice. As soon as we get sane contracts in force, both sides are protected and life can resume normality.

Of course, the studios can always opt to move or send all their work overseas. It is a free country, sort of. But I don't think they will.

Now I know some of you are going to disagree with me. I admit I could be wrong on some things, but I won't know unless you convince me. Please post your comments, pro or con, below, and take the time to explain what you mean. Also, please don't do it anonymously if you can help it. I want a real dialog here and if you spout anonymously, how much credibility can we give you?

-P-

83 Comments

Categories: Blog, Business, VFX
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  • Chris

    Great article! I’m just unsure about this fact “From March of 2012 until April of 2013″, since we’re not in April 2013 yet.

  • Chris

    Great article! I’m just unsure about this fact “From March of 2012 until April of 2013″, since we’re not in April 2013 yet.

  • Renee

    Love your article, also. Your suggestions sound like they would be very difficult to influence, especially on the studio side, from what I’ve heard from people I’ve talked to at R&H, I had suspected these same reasons for their bankruptcy, though. Thanks for doing extensive research and drawing rational conclusions.

    • Peter Plantec

      Thanks Renee. The hardest part has been separating fact from hearsay…I don’t pretend to have it perfect, but I’m close. Many folks came to me with their versions. That’s why it took me so long to respond.

  • Pockle

    What about corrupt VFX producers? There’s no shortage of them, and some are quite predatory.

    • Peter Plantec

      You make a point Pockle…but I wouldn’t paint all VFX producers with that brush…most are honest and fairly reasonable.

  • Chris S

    Would it be fair to suggest that it was their proprietary pipeline that helped do them in? A greatest strength also being a greatest weakness scenario? Of all the hundreds of artists they had to hold, only some of them would be 3D artists and 2D artists are generally not proprietary in terms of specializing in character animation vs other 3D capabilities.

    • Peter Plantec

      Chris, I don’t think it would be fair to assume that. They had more Houdini developers in-house than the did for all their proprietary tools…that plus their flexible pipeline allowed them to quickly adapt to certain Jobs and do things that others might not be able to do quickly. R&H has a tendency to keep,their best people on overhead between jobs. It makes sense because it allowed them to get up to speed quickly and be very competitive. That and these senior people could do high end work,that is not easily sent to china or India…accept to R&H India. Where they have the tools and expertise.

      • TooScared

        I had worked at RnH for years and I don’t find this isn’t totally accurate. I’ve been working in the industry to for years and have seen my fair share of large VFX studios. RnH did get some profit sharing on some films as well, but for a reduced rate of production costs.

        Firstly, the proprietary software means that training up new employees takes longer and more resources than other studios. It also serves to demotivate people who already have work experience working in Maya. For example, if you are a rigger, how useful is it to you to work a show or two and getting experience in a piece of software that doesn’t exist outside of that single institution. It also means that the people who know how to write 3D software, rightfully commanding six figure salaries, are trying to keep up with other software development companies who employ hundreds with just a handful of programmers.

        Secondly, I regularly saw the most talented people leave RnH for better jobs elsewhere. RnH was largely seen by many as a stepping stone to get to a ‘better’ studio and not as a destination studio in it’s own right. Most of the times I saw staff offers go out to employees it was a direct panicked result of a mass exodus of talent to another local studio that was hiring. I’m hesitant to state this as an across the board truth, but many of the staff were people who got their start in the industry as students at RnH, got their staff offers because they were on the tail end of a mass exodus (because they were the least employable outside of that company) and were the few left standing. The level of talent amongst the supervisors had the biggest disparity I’ve seen in the industry. There were a few that were amazing artists, but many were substandard to others in non-supervisor roles in other companies. RnH thrived on students entering the industry working long hours for cheap and dumping them when the show was over. Very few people enjoyed staff positions and even fewer actually wanted them because all the perks of staff also carried the penalty of no overtime pay which meant your hourly rate became non-competitive with other studios. The vacation incentives that you mentioned were largely attempts to offset this. When you work the insane amounts of OT that RnH required of you, time off felt like the most valuable thing to you, more so than money.

        Thirdly, the most senior staff people that you reference rarely did any of the work themselves. Most of the supervisor roles at that company involved nothing more than relaying notes from the director to the temp hires and managing people’s moods. In fact, many of them hadn’t touched a shot in ages and it also added to additional difficulty in getting employment outside of the studio as their reels were aging with no new work being added. The studio struggled to get India to produce the quality and quantity of work that was required and often times these shots needed to be ‘fixed’ be stateside employees in every department.

        Those were my personal experiences and my perception from working there. I have no ill will towards anyone in that company, despite how it violated labor laws at times and treated it’s project hire staff very poorly. It was a pretty difficult time working there as we had to go month long stretches without a single day off at times, working 12 hours a day. Not many experienced professionals from outside of that studio would put up with those kinds of working conditions when given a choice. I wish everyone who worked there well and the rest of the industry well.

        • Peter Plantec

          You’re the second person to suggest to me, that at least a portion of R&H was a sweat-shop. I have no direct knowledge of that, but you know …smoke…fire? I appreciate the time you took to lay things out. Apparently things were not as cushy lately as they were a decade or more ago. I often speak with the powers that be and I can get a distorted picture of reality. That’s been the problem with trying to figure out exactly what went down at R&H. People like you adding your view to mine that makes this forum work. Thank you….don’t be scared, we will eventually get this worked out, as an industry. We have to.

        • Magda Lena

          Good afternoon,

          We are a group of students from Manchester Business School currently working on the project about outsourcing in the animation industry.
          We are particularly interested about the bankruptcy case of Rhythm&Hues (“Life of Pi”).
          We are really struggling to find a specific data on that matter. We were wondering whether you could answer some of those questions or suggest someone who could help.

          Bidding war: which companies were bidding for project and what was the range of the budget that each company proposed.

          What differentiated Rhythm&Hues from other companies and was there any previous working relationship between R&H and 20th Century Fox?

          How much influence did Ang Li have in choosing animation studio?

          Did R&H file for bankruptcy because of miscalculation of the budget for the project or they previously had internal financial problems and pressure from Fox studio just made it worse?

          We will be extremely grateful for any help!
          Kind regards,
          Magdalena

  • Lynn

    This situation with toxic studio supervisors applies to any creative work done outside the studio itself, where redos cost them nothing. I have had them make me redo my work six and seven time only to have the director go back to my original version. Rare is the supervisor who lets you do your job and then the accept and redo decisions are only made by the top person in authority.

    • Peter Plantec

      I appreciate your input Lynn. I have to reiterate that the majority of client- side VFX Sups are good at their very difficult job. But those few bad apples can cause havoc.

  • Donald45252

    Great article! If these problems are so obvious on the VFX management side, why sign on for the work?

    For example, I don’t know any other business where you’d sign onto an open ended cost structure on your own side when the client changes plans.

    It all sounds like bad management to me.

    A good CEO would itemize their charges for everything that adds costs over the fixed price…and would definitely have a dialogue about who to work with as the client-side VFX supervisor.

    • Peter Plantec

      Exactly

      • Ash

        Well that only works if there is a trade union and all other studios agree on those terms.. Cause without that association.. You might take a business or a moral stand.. But there is enough competition to tkae over your work the very same day..

        • Peter Plantec

          Exactly. The thing I worry about is keeping a fair and even keel. If there was an international trade organization, would the stick to keeping the business of VFX fair and equitable or would they expand and start controlling the industry. For example I know there are problems with subsidies and tax credits, but they exist for most industries. How do you think we got Toyota to start building cars in North Carolina? Scott is right that ultimately they are not a good thing overall, but they do help local economies. They do help VFX companies. Making the elimination of subsidies a priority to me seems counter productive. What do I know? But I’m smart and I say leave the subsidies alone for now and stick to equitable contracting based on standard good business practice.

  • chris.schwarze

    So how do you quote? My feeling is to quote man hours. It’s the only way to track the progress of the work, and overruns. It happens on the shoot. Extra days, the crew get paid.

    The best studio’s will rise to the top, with efficient clever people doing the work. Quoting for VFX before the shoot is a crap shoot.

    It puts the responsibility where it belongs. The studio, director, producer. If they want to go overboard with great VFX, then terrific, everybody wins.
    The other part of the puzzle is to keep a track of man hours. This will stop the abuse of VFX people working excessive hours with no pay. This is where the association comes in.

    • Peter Plantec

      You ask the key question and make some good points. Right now the only way I see to quote a job and not loose your shirt (and no guarantees on that) is to pad the hell out of it with cost items I call ‘Unks” and “Unk-unks”. Unks are unknowns that you know from experience are going to happen…lie re- dos and delays. Unk-unks are unknown and unexpected unknowns like major delays, never satisfied OCD VFX Sup client-side. Etc. you also have to bid realistic overhead costs including maintaining key staff during down time. If you do this right you should be able to survive the job unless the extreme happens. Of course your bid will be high. The job will go elsewhere unless you have some things that the studio really wants. Therein lies the crux of it Laddie.

  • Anonymous

    When did it become fashionable for shows to just take arbitrary 6 month breaks?

    They never used to do this, nor did they continue the pretense of delivering 6 months before the release date.

    • Peter Plantec

      I believe these massive delays are a growing phenomenon caused by many factors, some having to do with internal arguments about what is good and what is not and and too many people without an entertainment eye making decisions.

    • Peter Plantec

      I wish I knew what’s going on.

  • http://www.facebook.com/ToddSheridanPerry Todd Sheridan Perry

    Brilliant write-up, Peter.

  • http://www.facebook.com/paul.d.petroff Paul D. Petroff

    Very insightful article. I concur with the idea that VFX houses should track their “billable hours” for a given shot; that way, if the studio wants to approve numerous reworks, then they can accept and absorb the related costs of those choices. This would also tend to minimize the decisions of some of those “toxic” VFX supervisors you mentioned because they would soon become apparent to the studios (who could then deal with these individuals as needed). It’s really sad to hear that such a great VFX house was brought to its knees due to having a lot of work going on. . . .

    • Peter Plantec

      Paul, I absolutely agree…that would be a good business practice giving the studio control. But that is done on a CPFF basis where you would bill the studio the actual cost of the job, plus a fixed fee. It’s a much cheaper way for the Studio to do business because it eliminates padding. But to most studio bean counters VFX is akin to magic and they don’t like dealing with such things. There is the assumption that the Houses could bill for all sorts of things and they wouldn’t know if it was legit or not. The contract negotiators don’t seem to even know what their client side VFX Sup does. They just want fixed numbers because they’re easier to deal with…screw the fact that is killing an industry. I thing client side VFXx Sups..the good ones are on air side in this.

      • Ash

        I believe big houses like R&H already track their billable hours very closely..
        But as you said.. The clients don’t want to hear about increasing and decreasing billable hours.. They want the figure..

        • Peter Plantec

          Yes, that’s for internal use. The contracts are usually on a fixed price basis, so Studios gemerally don’t care about billable hours.

    • Peter Plantec

      Tracking billable hours is kind of tricky because its easy for an unscrupulous house to pad the hours. The House has to be responsible for delivery of the product for the estimate. The vagaries of VFX work make this difficult. I think there is work to be done to come up with a system that protects both sides.

  • thad beier

    In my experience, rational VFX studios already implement a number of these practices. You can get profit participation, if you forego some of your up-front charges — I’ve seen it done, and seen it work to VFX studios benefit in one case. All VFX studios charge for change orders, including shots killed in the middle of the show. All big VFX studio contracts have very strong language for termination of work on a shot.

    Your point about delays, though, is a good one. It’s a relatively rare thing, but it has such a huge impact that it should be in contracts. I was working at PDI’s VFX branch in LA, and it was done in by a similar 6-month delay. Some way of making studios pay for the costs incurred by delays is important — but there’s nothing stopping VFX companies for writing that into contracts now. Say “Our cost will be X if you will pay a retainer if the movie is delayed, or it’s X * 125% if you won’t pay that.”

    • Peter Plantec

      I did not know this, Thad. I do know that it is rare to have contracts with this kind of wording. Profit participation is risky when you consider the notoriously clever book keeping the studios are famous for. I hear Titanic is yet to see a profit. Scott Would know more about that. But I agree. In talking with several heads of Houses I’ve been told that Studios often reject what you so rightly characterize as “rational” language in contract negation unless they really really need you. Again it comes back to a House has to make itself pretty indispensable to cut a rational deal. Thanks for chiming in and educating me.

    • chris watts

      Any VFX house tht fail to include a provision for delays has got a seriously incompetent producer. Do we know that these provisions weren’t in the R&H contracts? Because schedule has been a part of every negotiation with every effects house on every one of the 30-somethng studio films I have supervised. We haven’t always made the dates we originally promised, but we’ve always negotiated a deal that satisfied all parties. As far as changes go, the approach I have always taken with changes that were not foreseen in the original bid is this: give us the price of the changes you want, and that will inform our decison about how to proceed. Now, I do expect my facilities to maintain a consistent bidding philosophy for the course of the show. If I award 75 shots at X dollars a shot. I expect that the 20 additional shots that creep in will cost the same amount of money, provided there are no overage-worthy new ideas. I have lived through shows where people don’t like changes- indeed, they will get their knickers in a twist over a color change (or whatever) that has no consequence to cost and for which work has not been done yet. Or, near the end of a show, they get ‘shot fatigue” and start charging 15K for a split. One producer who I’m sure Pete knows well became hysterical about a fairly substantial change that the director asked for rather late in the game. We were happy to pay whatever it cost, and my request was ‘tell me the cost, and based on that we’ll decide what to do” After ten minutes of telling me that “the director should have done this and vfx should have done that” someone put pencil to paper and sent a bid, we paid the cost, and the shot got done.

      Look people, times are tough all over. Everybody is struggling. All the practices Peter talks about and more are already in use. Our industry isn’t perfect, but its not in the dire condition that that is being put forth. This whole campaign is a directed attempt to get the unions into visual effects. I can tell you- I’ve worked in union VFX shops and non union shops. With the exception of health insurance (granted on all union jobs and some fraction of the non union jobs) there is zero benefit to being unionized. Union vfx artists do not get more respect, or a better seat at the table- you’ll get these when you’ve got credibility and experience. But everybody’s gotta start somewhere. The answer in not reconceptualizing the industry, it’s incremental change.

      I do see some promise in the idea of a trade association, though. A set of standards similar to what the AICP has accomplished over the last 20 years.

      I could go on, but there are scripts to break down, Back to work, people :)

  • whatafoolbelieves

    I don’t think that your story is unbiased at all.. I think that you went with the already written narrative and ran with it. I don’t think that you know what really went down at R and H at all.

    However, your suggestions on how ti fix existing problems are good ones.

    • Peter Plantec

      You would be wrong about that whatafoolbelieves. I haven’t read other accounts, I was too busy doing my own digging. I’ve been in the business a long time and I have fairly deep connections. What “already written narrative” are you talking about?

  • sageface

    There are really only a handfull of people who know all of the circumstances surrounding any studio’s collapse, so while thats a reasonably good hypothesis, we may never find out the specifics.

    Personally, I feel the clearest path out of the woods right now will involve a lot of these “come to Jesus” types of conversations where the industry will have to ask itself some very difficult questions and own up to past mistakes. How easy that will be is anyones guess, but there are a lot of people involved on all sides whose careers depend on their “reputations” who likely will not own this…

    Right now we are at that intervention point when on the one side of the coin we have addicts, hooked on a more or less free flowing tap of creativity that they can call on demand regardless of cost and on the other we have the enablers, eager to please and avoid confrontation in the name of hoping it will all just work out. Breaking the cycle we will have to take some risks and communicate honestly about what we need to be the robust and vibrant industry that makes fantastic art possible.

    • Peter Plantec

      Very well stated Sageface and I think you make good points. It’s time for a reckoning across the industry, on all sides. It is shakeout time and hopefully in the end, things will have changed for the better, the industry will be relatively stable and families can dig roots again.

  • The Observer

    Terrific article Peter.
    The delays are crazy.
    I can’t believe there’s nothing in the agreements between the studios and VFX companies to handle that.

    I applaud John Hughes for keeping the people during the delays, but at the same time, it’s business and he can’t expect the studio to pay for keeping those people on.

    I DO think that maybe there can be a “keys” clause when it comes to delays. For instance, you define certain people on the production as “keys”. They are brought in at the beginning of the project usually so you’d know – at the time the studio contracts with the VFX house – that these people CANNOT be let go if there’s a delay.

    At least that would let the visual effects keep their “key” people and not have to eat millions of dollars in salaries. Sure, some people would have to be laid off, but you’d be able to keep your brain trust intact. It’s not unlike “key person” insurance that many companies have for their executives.

    It’s like an insurance policy……it keeps the studio honest.

    Changing THE ENTIRE SCOPE of work however is the studio’s responsibility.

    This is a quote from Christopher Nolan,

    “I’m often quoted in the press talking about visual effects like an actress talks about her use of botox… I know visual effects people pride themselves on doing the impossible. I’d just like to encourage you to say no to the unreasonable,”

    • Peter Plantec

      Observer you speak wisdom. From your mouth to Go…er…the Houses and Studio’s ears.

  • http://www.facebook.com/scott.ross2 Scott Ross

    Nicely done Peter. A well balanced investigation, and an almost well balanced solution. A Trade Association is the only way to implement or at least try to implement some of your suggestions. And yes, the business model is a serious problem that needs to be rectified as soon as possible. But these issues that you bring up are not systemic only to LA or CA based VFX houses, they are or will be in short stay, impactful to ALL VFX houses throughout. And finally, while the Tax Subsidy issue is not as paramount as the business model issue, it still is a MAJOR contributing factor to the problems facing the industry…

  • David S

    I love how the article completely ignores the absolute sub-par work RnH did on RIPD, basically forcing Universal to put their shots on hold or rework them, or the completely idiotic move of throwing money into Percy Jackson 2. But I guess that bad work and poor decisions don’t matter when you’ve got righteous indignation on your side.

    • Peter Plantec

      I wish I could respond intelligently to that David. I don’t have specific knowledge. But even if what you say is true…which I honestly doubt, their two and a half decades of ground breaking contributions and work on Life of Pi alone means they have a lot more than righteous indignation on their side. Also, I clearly said, R&H has made mistakes along the way, we all have, but they were not the cause of the bankruptcy.

      • David S

        Can you please stop it with the “R&H worked on Life of Pi and now they’re bankrupt” nonsense as if the two are somehow linked? This is the most irritating meme out there. Yeah, I get it. Life of Pi made a billion dollars and R&H is bankrupt. Life is tough. No-one ever says “MPC worked on Life of Pi and now they’re doing just fine” but it’s just as true.

        “R&H has made mistakes along the way, we all have, but they were not the cause of the bankruptcy.”

        No, of course not. There’s no way that R&H could have been at all responsible for not being able to keep their own business afloat. That’s just crazy talk. You can’t even *suggest* that a VFX house may have mismanaged itself into the ground, it *must* be someone else’s fault.

        • Peter Plantec

          MPC and R&H two venerable granddames of the VFX industry. Each about 25 years old. Sad to see one go. You can’t really compare the two in this situation, the delays and tasks were very different. Bravo to MPC…I’m a fan of their work as well. I’m getting tired of the story too, but somebody needed to dig a little deeper. Frankly the fact that the venerable R&H could go down scared the crap out of me.

          That’s why I keep digging. If you seen some of my comments at NPR, I assumed they “crumbled from within…” But if you go deeper, you discover they were actually doing okay until this perfect storm of delays overwhelmed them. I’m still trying to discover why they didn’t bale on the overly delayed shows…I’m sure they were locked in somehow…and that might be a lesson to all. I’ll keep digging.

          • David S

            “But if you go deeper, you discover they were actually doing okay”

            Doing “okay”?!? Doing OKAY?!? This is the only industry I’ve ever heard of where people whine about how tough things are when companies are “doing okay”. If Apple or RIM or Microsoft have a week where they’re not at the top of the innovation playing field for that week, their stock tanks and the media openly speculate whether or not they have a future.

            “Doing okay” is no longer an acceptable business practice. This is exactly why R&H failed. This is why DD failed. This is why Dreamworks has to lay off people and Pixar doesn’t.

            The complacency in this industry is going to absolutely kill people and companies who have been coasting in it for too long. There are no longer a few dozen VFX facilities around the world and thousands of artists. Now there are thousands of facilities and tens of thousands of artists.

            We are not going back to the ’90s We simply aren’t. People can talk about unionization and trade associations and tax rebates all they want, but it won’t change the fact that the number of people and facilities chasing after VFX work is outpacing the growth of that work. What that means for the present and future is that whoever can deliver based on quality and price will win work, and those who can’t will be pushed out of the expanding industry.

          • Peter Plantec

            Two things. First, “doing okay” means they weren’t going under. Second. As far as I’m concerned, you’re preaching to the Choir. And I would add that it sure helps to have a specialty that you’re known for. The problem is that you can get pigeon holed. The tricky part is to maintain a good reputation as a “Go-House” in general and then to stand out somewhere not too esoteric.

          • David S

            ” “doing okay” means they weren’t going under. ”

            I fundamentally disagree on this point. I believe that if you don’t continue to be on the cutting edge in this industry, you are going under.

            R&H did great work on the Tiger in Life of Pi – no one disputes that – but that isn’t enough. Because there are now thousands of hungry, young, nimble companies full of smart people ready to knock out the big guys the moment they drop their guard.

            It may not be fair, but that’s business.

          • Peter Plantec

            I guess we’ll have to agree to disagree, David. I agree with some of what you say…big companies have to be nimble and stay on the cutting edge and watch their operating costs. The management hierarchy can get out of hand at the bigger companies too. Where we disagree is that I feel R&H was on the cutting edge. Hungry smart young and nimble may not be enough these days. Know-how and infrastructure counts for a lot.

          • David S

            “Where we disagree is that I feel R&H was on the cutting edge.”

            And one of the main characteristics of a cutting edge business, is having strong financials, which R&H clearly lacked. You need to keep your business well capitalized if it’s going to survive in competitive markets, and for all their other virtues, the company clearly couldn’t figure that out.

        • ash

          That’s funny.. Comparing to MPC because it worked on the same film and is still going on.. That’s dumb.. And sub-par work? That’s quite a contention..

    • M

      Was it also R&H’s fault that the film went through a few editors? And multiple re-edits? And re-shoots? And 3 pre-screenings which forced major story changes? Sounds like you have an axe to grind. Bitter ex employee perhaps?

  • Mariana Acuna

    Peter, what a great article! Everything sounds like a very possible scenario of how things went down. I definitely agree with you with the toxic people sometimes VFX facilities have, there’s always that one guy that REALLY likes to pixels f….* But then there’s a lot more that are just really talented, good and fun to work with. I feel lucky except for one place, I’ve always had the pleasure to work with very good people (here in LA). Now, the question is WHEN, things are moving forward, but are we going to be able to achieve change fast enough? Before more places and more layoffs take place? Are Studios and facility heads ready for the change? I know, I certainly hope so.. Change can’t come fast enough…

    • Peter Plantec

      Mariana, y gut feeling is that hollywood is divided between the old guard who are set in their was and the new bunch who seem ready willing and able to adapt and change. Unfortunately there is also a huge number of families in between who could adapt but are tied down and can’t move or change jobs easily. The big question Is can the studios change. Clearly it is in their best interest. They do not have a great track record in this area…they seem to prefer business as usual and let everyone else adapt. Hopefully that is…ironically…changing too.

      • http://twitter.com/Da_VFX_Chick Mariana Acuña-Acosta

        Peter, do we know if Studio heads are even aware of the problems and what’s going on? Or are they still inside their own little bubble incapable of seeing what’s outside of it? We talk and talk about Studios, I’d love to see a Studio “something” come out of their cushy lives and show some face…

        • Peter Plantec

          You know Maria, that’s a good question. I don’t know, but I know who would have an inkling.

          • Mariana Acuna

            Do tell Peter! (and the name is MariaNA :P )

          • Peter Plantec

            Oooops

        • Peter Plantec

          I will give it a shot. I know a few Studio executives and former ones.

  • http://www.facebook.com/larrywberg Larry Weinberg

    A very nicely written article Peter. This is the best summary of a difficult subject that I have seen so far. I was with R&H during its first 10 years and know very well of the heart and soul that you have captured a bit of here. It’s very sad to think that the owners of this great company might be left with nothing from their years of sacrifice and integrity. You really need to work in visual effects because you love it. It’s not the most practical course in life. It’s cut-throat and competitive. It chews people up and can turn some into house hold names or can destroy others’ reputations in a day. Having not been with R&H during the last 7 years I can’t say what really is crippling them, but I think one point I can add is that the companies that seem to be able to hold on in a field like this have been owners of their own creative properties at some point. This is one thing R&H was never able to successfully achieve. There are probably many reasons for this, but I think that is key to success in this arena. You need to find a way to pool the best and most creative people, buy them some time, do it right, and produce something truly unique. Pixar pulled it off. PDI->dreamworks pulled it off. It may take financing. It may take giving up a piece of the company, but I think that’s the only way an animation company of 1400 people can become stable.

  • http://www.facebook.com/larrywberg Larry Weinberg

    A very nicely written article Peter. This is the best summary of a difficult subject that I have seen so far. I was with R&H during its first 10 years and know very well of the heart and soul that you have captured a bit of here. It’s very sad to think that the owners of this great company might be left with nothing from their years of sacrifice and integrity. You really need to work in visual effects because you love it. It’s not the most practical course in life. It’s cut-throat and competitive. It chews people up and can turn some into house hold names or can destroy others’ reputations in a day. Having not been with R&H during the last 7 years I can’t say what really is crippling them, but I think one point I can add is that the companies that seem to be able to hold on in a field like this have been owners of their own creative properties at some point. This is one thing R&H was never able to successfully achieve. There are probably many reasons for this, but I think that is key to success in this arena. You need to find a way to pool the best and most creative people, buy them some time, do it right, and produce something truly unique. Pixar pulled it off. PDI->dreamworks pulled it off. It may take financing. It may take giving up a piece of the company, but I think that’s the only way an animation company of 1400 people can become stable.

    • Peter Plantec

      That’s actually another blog I’m working on Larry. Thank you for bringing it up. In my quest for routes to survival this keeps coming up. I really appreciate your chiming in here. You’re a bit of a legend in the industry. So thanks for the kind words. I recall I actually met you way back at R&H when your wife brought me round. Only the bigger houses stand a chance of producing a film and it stands to reason that it better be a good property. Also producing a film takes special skills…everyone in Hollywood has “producer” on their card it seems, but so few actually know what they’re doing. But it is a viable route for some.

  • vfx.droog

    There may be a few bad client-side supervisors out there. There’s been some trouble where VFX Producers decided to upgrade themselves to VFX Supervisor. But in a world where a show gets divided up between five or ten vendors there needs to be a RESPONSIBLE single point of contact on the studio side. The director might not be able to spend 6-8 hours per day personally reviewing VFX shots and giving feedback at multiple facilities when there’s editing, sound, music, marketing, studio politics, reshoots, etc. consuming their time during post. And even if they are willing, some directors are not necessarily adept at critiquing visual effects shots.

    Like any film crew department head, a good client-side supervisor will get the important, time-critical feedback transmitted to the facilities and keep all balls moving forward. A really good one can anticipate potential problems and make sure the director understands all the downstream implications of a decision.

    And by the way: As a cost-cutting measure, studios have been employing FEWER client-side supervisors in recent years. I think you’ll find the number of 911’s, unreasonable 11th hour changes and the general level of chaos has increased correspondingly over the same period. I don’t agree with your theory of studio-side supervisors contributing to R&H’s problems.

  • clément

    Massive union and strike

    • Peter Plantec

      Who are you going to Strike Clément? R&H? You don’t work for the studios so you can’t strike them where it might do some good. Strike the houses and put them out of business? Now there’s a good way to make sure even more work goes over seas. An international trade association makes sense, but putting it together will require Houdini’s resurrection.

      • clément

        it’s only a problem with R&H or every studios ? without vfx any blockbusters, so if a massive strike is coming, fox and WB will cry.. we are 99.9% against them

        • Peter Plantec

          That’s not going to happen. It’s probably true that a coordinated work stoppage in VFX might bring the studios to their knees, but there are several problems with that. First it would have to be global…good luck,with that, and second. You dot really want to hurt the studios. They are the clients. They make this industry possible. They finance the films. Without them every body is out of a job. We need a show of intelligence, not a show of force.

          • clément

            lol… “we need them” really ???! or they need us to make billion dollars with films ?!
            it’s not impossible to do a global union. If not anything will change. Studios prefere to bankruptcy ? or try a strike ? there is anything to lost like R&H. Keep hope please, or in this world you will to continue to eat GMO, pesticid, water with medicine. If you prefere a world wich is drive by business without respect it’s your choice..

  • http://www.facebook.com/elhaqbook Haqi Jamison

    I’m a New Media designer and hoping to work in this industry someday. It seems to me that the biggest problem is that the VFX houses aren’t creating their own films. Lucas did star wars and some of the companies that create the software like Red giant and others have created really great films with little. Why aren’t these houses with all their expertise benefiting from the downtime by creating marketable projects?

    • Peter Plantec

      Haqi, there is a reason. Producing great entertainment is a very different process, requiring significantly different talent and skills. I do think it makes some sense for certain VFX companies to perhaps get involved in producing entertainment, as long as they have a solid distribution partner. (I don’t equivocate much do I?) But it is a very different business and could be a total distraction. It depends on the people involved and where their strengths lie.

  • Peter Plantec

    Some people think I sound Anti studio…I’m not. I think I defend the studios as often as I give them a hard time. Lets remember that the studios make this industry possible. I am anti bad business practices. The Houses are as culpable as the Studios in this. Let me point out that not all houses sign bad contracts, and that Studios have been known to pay for delays. Reading myself above it looks like I’m saying this doesn’t happen. Sorry…I get passionate. But it only happens when both sides negotiate hard and hammer out a rational contract. We wouldn’t need legislation to regulate if all sides did a better job contracting…IMHO.

  • Patricia S

    I would look to John’s lack of future vision. When you don’t own the project you don’t have any control. John professed to want to develop their own movies, but when we offered him $100 million to develop those movies he said he preferred mowing his own grass on Saturdays to having a partner. Well now he’ll have the time.

    • VFX.droog

      John’s a smart and determined guy. If he really wanted to transition out of the service business he would have been able to make it happen.

    • Peter Plantec

      Interesting Patricia…I did not know that. I suspect John will be mowing a lot of grass. I do feel for him. This is interesting and useful conversation input.

  • LG

    Great article… right up until the “legislation favorable to keeping VFX houses in California and especially in Los Angeles” part. I’ve been in the VFX business for almost 20 years, but have, by choice, never lived in L.A. “Favor VFX houses being in California and LA” is a divisive battle that we don’t need.

    Make the business model and relationship with the film studios sustainable and fair — that’s an inclusive position rather than a divisive one — and let the geographic chips fall where they may (i.e. where the artistic and technical talent wants to live and where the costs of doing business are reasonable), without any government fingers tipping the scale one way or the other.

    One more thing: name names! WHICH shows, WHICH studios, are the ones that delayed projects and caused R&H to bleed money trying to keep the staff that was necessary to do the shows? Everybody knows the VFX houses and executives who are declaring bankruptcy, It’s time to hold feet to fire for the specific studios and execs who are contributing to this tragedy from the other side.

    • Peter Plantec

      Man you make a lot of interesting points LG. I’ve pointed out why I think the state of California has to do something because the local economy is being badly impacted by the flow of money overseas. I’m all for divvying up the money around the country and around the world, but let’s give LA and California a level playing field.

      As for which shows caused the problems, I’m pretty sure that information has been published. I’d have to check my facts…check around.

  • Bluto

    Wait, let’s back up here for a moment. This is a very nice article, but it’s light on any real facts. If R&H was burning between $1.2-$1.6million a month on 4 separate “stalled” projects and no one there thought that was a bad idea, they’re not bad at business, they’re damn idiots. Projects falling through or being delayed is nothing new in this industry. It’s nothing new in any industry. It’s as old as the concept of hiring someone to do work. There are going to be delays, and when the delays become too great, you stop spending and do the responsible thing to make sure the company stays open, and you lay people off.

    But this bankruptcy didn’t happen because of these 4 shows being stalled, you could see problems on the horizon for a while. As i understand it, they stopped doing their weekly state of the company back at the beginning of the year or late last year. Lack of their standard transparency. They have also been increasing people’s “sabbatical time” since 2009. There’s also been a general slow down in the number of large tent pole movies the last few years, and increased competition for the work with the rise of new shops over the last decade. Now the big question, did they make money on Life of Pi? Or we’re these stalled jobs paying off the last job? It’s happens in our industry time and time again. Losing on one job and trying to make it up in others.

    Until a full, independent audit of R&H’s books are done, which will probably be part of the bankruptcy sale, we won’t ever have a full understanding of what was happening there. It may have been a great place to work for the faithful but from talking to a number of the laid off, who didn’t get paid for their last 3 weeks of work, they never saw it coming. And that’s no way to treat people who you said were family.

    • Peter Plantec

      I’ve been thinking the same thing Bluto. I’m going to find out what that was all about. and with any luck I’ll check back with an answer as to what the hell were they thinking. I have a feeling there were multiple reasons they couldn’t just drop the projects.

    • Ash

      The shows had been going on for the last two and a half years.. Of course the problem was seen on the horizon.. Doesn’t take a degree to see that..

      And the owners did their best to find buyers, who would take care of the company as well as they did for 25 years, in that time.. They could have sold it at a good cost to many who might be interested and made their profits and bolted.. They only gave up right at the end.. When all hope was lost.. They didn’t need to wait this long to sell off the company and get make a profit in the process.. In fact one could argue that by holding on till so late in just to find a “suitable” buyer they made a personal loss..

      One of their (owners) bigger mistakes was not treating themselves better for the sake of the employees.. If they wouldn’t have thought so much there is a chance they might have been able to sell the company at a higher price long before, become rich and wiped their hands off.. What the new owner would have done couldn’t have been known obviously.. Which is what is the case even now.. But then I would argue what they did was still better..

  • 18 Year VFX Producer

    Dear Peter,

    I was a client side producer for many years and have spent the last six as a bidding producer at a mid-size facility so I have experience on both sides of the system. Although I think many of your comments are true and contribute to the problems we are all facing, your comments about client side supervisors and producers touch a raw nerve. I understand the context you were speaking in and
    that you were speaking of “bad apples”, but your underlying attitude and that of many “artists” highlights one of the primary problems preventing the empowerment of artists and the solution to many of these problems …. you (and most of the people stirred up, albeit righteously, about these issues are incredibly parochial, circumscribed and petty when it comes to your lack of understanding of the politics and process of actual filmmaking.

    Until you and other “artists” , and the studios and the production side craftspeople understand that you will never have a f**king seat at the table, until you elevate and empower your representative (whether they are paid by the studio or by the facility) as your “department head”. You will never manage the director, contribute to his creative vision, get proper credit, get the respect of the studio or manage to unionize unless you have a “department head” sitting as a union equal, at the table starting with the prep of the film through its completion.

    Further, as facilities become farther and farther removed from the decision making process in production the less opportunity new technologies in virtual production will be available to VFX people. Right now, smart production designers are usurping more and more of the VFX artists role in creating
    digital environments, set extensions and virtual sets, right now, D.P.’s are
    (albeit slowly and ignorantly) taking more control of performance capture
    technologies, the use of virtual cameras and integrating themselves into the
    pre-vis workflow. In other words, they are taking our seat at the production table because we reached a tipping point in the last few years and the majority of people in VFX now have little understanding of how films are actually made and, like you, denigrate and dis-empower those few remaining VFX representatives who have the balls (or dogged stupidity) to stand on set and fight the good fight in the production process, where so many of the problems we hae been talking about first arise.

    Back in the day, and not that ,long ago, VFX teams had experts in camera, in
    rigs, in motion control, in model-building, in miniature special effects and
    most VFX Supervisors were also in the D.G.A. as second unit directors. VFX crew members were represented by the cameraman’s union, or the propmakers union and as a result, they were integrated into the production team . They also got fair credit. We can all remember the days when VFX facilities got equal credit with above the line folks and the VFX artists clearly doing creative work,
    department heads, matte painters, animation directors, were also usually properly credited. As soon as the majority of the work was done 100% digitally,
    we started to lose our seat at that table and without an established union or
    agreement of any kind with the AMPTP we were the weakest link in an expensive
    chain. Now, with virtual production tools arriving at our doorstep we should
    have great opportunity to gain back some of that ground, but we will lose it all
    if we don’t educate ourselves as filmmakers again and focus on securing the VFX Department a seat at the production table.

    I cannot believe that none of you can see that, with all the circular logic about unions only applying to facilities, or trade associations requiring a majority of vendors to be effective … It is the AMPTP we need to be dealing with and addressing and your only f**king door into that conversation is your supervisor, your department head, that’s where this change will start, and only there.

    I mean this respectfully Peter, because you are a smart man, but you have
    never been actively involved in the production side of a motion picture. And
    virtually none of the owners/managers of contemporary large VFX shops have any real experience dealing with writers or directors, producers or production
    teams. There are only a handful of places left like ILM (or Phil Tippett) who
    understand the ins and outs of production.

    This situation is hopeless unless people set their own narrow-minded
    worldview and egos aside and realize they need that department head … that fighting for that seat at the production table is a lever that will help lift everyone, help restore some respect and credit to the VFX department (the department includes all the vendors and artists) and help preserve the future opportunities for onset roles in virtual production technologies that should by all rights become
    part of the VFX teams talents and responsibilities.

    If the leaders of this industry like yourself, or Scott Ross or Scott Squires or Dave Rand who are all making great personal efforts to help save this industry do not focus on the role of the VFX department on the production side, then there will be little hope. If VFX artists do not educate themselves to understand the needs and the goals of producers, directors, writers, production designers and cinematographers and yes, even studio executives, then they will never have the seat at the table they desire and deserve.

    It is no accident that so many studio VFX executives and production side producers come from live-action, particularly commercial production. John
    Kilkenny was a live action commercial producer at one time, as was Mark Brown as was the late Eileen Moran, as was Crystal Dowd, as was Jennifer Bell and
    many others. They learned the invaluable skill of defining and managing
    creative to a goal, and we on the facility side need to understand that and be
    part of that process.

    So here are two achievable suggestions that such a large number of activists
    should be able to make happen:

    Formalize the standing of the on-set team, regardless of who they work for,
    facility or studio directly. Demand that the D.G.A. formalize the role of VFX
    Supervisor. Include this role with the A.D. Department, the Director, the UPM
    and other DGA categories, Then on a D.G.A. film you would always have to have a D.G.A. VFX Supervisor. The DGA makes the most sense here as many supervisors are already members because they are called upon to shoot plates or second unit, and because they are actively involved in working with actors in VFX sequences and in motion capture and performance capture situations. Demand that the Producers Guild, which already represents VFX Producers, negotiate with the studios so this job category receives the same Motion Picture Health and Welfare Benefits as the Associate Producers and Producers. This is a part of the basic agreement that needs changing. Demand that the data wranglers and on-set coordinators are represented by a union, in most jurisdictions this would be the same union representing the production coordinators. And make sure as our Canadian friends already are working on, that artists working on pre-vis or providing on-set visualization services, are represented by the Animation Guild,

    2. Make sure that artists working to provide editorial temps, post-vis or finishing shots in editorial working for production are members of the Animation Guild, The editors union, which has managed to retain highly structured work rules and good benefits for their members has refused to deal with them so maybe our IA organizer friends could get the International IA to send a great big “f**k you” to the Editors Guild on our behalf to get a little more support from our union brothers and sisters in editorial.

    I know this may sound crazy to a lot of people … but when artists ask for
    respect they need to act out of enlightened selfishness, set aside some personal feelings and goals for the greater good and understand that respect starts when the department head that represents them, no matter how remote, has a seat at the table and the respect of the producers, director, studio and fellow department heads and is not treated like the green screen guy scab by the crew,

    WE NEED A SEAT AT THAT PRODUCTION TABLE!

    We live in a world where the D.P., the Production Designer, the Costume
    Designer and usually even the f**king Music Supervisor get a billing block
    credit (poster and ads) and a head credit. How many physical sets were there in 300 or the Immortals? How many f**king costumes were there in Life of PI ? And
    yet, the VFX department head and all the artists and craftspeople in his department, who provided the visuals for the majority of the shots in the
    movie, who invented major characters who acted and moved the story along, get
    no billing block credit and, in the last couple of years, are usually now consigned to credits at the tail of a long credit roll, after the stunt riggers, caterers and second assistant sound effects editors.

    If I sound a little worked up its because I am. Respectfully, this situation has come about partly because folks who run facilities did not want to empower the creative’s that worked for them. They wanted to make it about their brand, the work of their company, and not be held hostage by star talent, be they supervisors or animators are artists of any kind. It is understandable in business to make your employees invisible to the client and keep them interchangeable to avoid being held hostage to wage increases, etc. This is also the reason that we have no unions or trade associations or any way to be part of the basic agreement with the AMPTP (that literally defines who has a seat at the table with the studios).

    These facilities brought a lot of this on themselves and the sooner artists
    get out of the Stockholm Syndrome they seem to be in and see these issues in an objective light, understand that their employers can be good people and haves selfish interests, and then take small easily accomplished tasks, like
    unionizing our on-set folks FIRST as a way to formalize our seat at the table
    and carve out the future job positions involved in virtual production for VFX artists and facilities, the more hopeful our future will be.

    • Peter Plantec

      That was a tour de force and I really appreciate you taking the time and energy. I don’t disagree with you. Your suggestions are great. You are educating me.

      But as a founding member of 5D I can tell you I am familiar with that side of the fence and I do see the VFX Sups on both sides as key people and we’ve talked about the new ways of developing movies faster and better through immersive design. Alex MacDowell has spearheaded the 5D movement. And VFX is an important part of the synergy we’re hoping for. It’s all about sitting at the table early on. Here’s a quote from you that I completely agree with:
      ” If VFX artists do not educate themselves to understand the needs and the goals of producers, directors, writers, production designers and cinematographers and yes, even studio executives, then they will never have the seat at the table they desire and deserve.”

      I wish you’d read a few more of my industry blogs in quest for a crowdsourced solution. I am not Anti studio at all…and I am very pro communication. I have friends who are Client-side VFX Supervisors who IMHO are some of the finest most talented people and their job is very difficult, yet somehow they make it all go relatively smoothly and the final results are spectacular with out a 100 do overs. I’m not sure but I think you were suggesting that this wasn’t true above. But we all know about the very few toxic ones that cause so much stress and loss. They are insecure and want to cover their asses so the make you do it over and over for no good reason without having to pay a penalty. That has to stop. Almost every house I communicate with has had this problem and usually with the same insecure people. It’s deadly.

      That said, I think some of your suggestions are better than mine and that comes from you’re hands on background. I don’t agree with everything you said, but it will take me some time to work it all out. I definitely don’t see where a union will do some good if someone can show me I would appreciate it. Being in a union doesn’t give you a seat at the production table any way that I can see.

      I really do appreciate your input. I think a lot of my readers will agree with much of what you have to say. Bravo. I get the feeling we may know each other…grin.

  • Peter Plantec

    Note, there are a LOT of comments here, but you may find it interesting reading through them. Some people have some really good suggestions, maybe better than mine and I’ve learned a lot just reading this stuff. Thanks to all you who commented.

  • Karah

    Hi Peter, well written article.

    Every studio has its issues. But from personal experience its those delays in upcomming projects that kill a VFX House. I had just scored one of those rare Permanent positions at a studio and was looking forward to some stability in my paycheck, when 6 months later, wrapping up a major film, we had massive delays in 2 more film projects. Studios kept telling us “just 2 more weeks”. And with a massive crew all ready to jump onto the next project, 2 months later it sucked the house under. Yes, they could have ditched a bunch of “non key” artists. But with the preverbial carrot only ever 2 weeks away its easy to think “we can make it work”.

    Now Im just a lowly artist and not privy to the inner workings of the studio, Im sure they had a few other hickups. But from where I was sitting, thats where the main problem was. As before that the studio had been running strong for years.

  • Leon

    Peter, no disrespect but the problem is with the VFX house directors. They are company directors first and foremost, they need to either price in the uncertainty or increase the capital in the businesses to deal with the risk. If the price and terms of the contract are not acceptable turn down the work.

    Start with the fact that this is a commercial undertaking first and a creative undertaking second. Cheers

  • Peter V.

    Well Peter, If your intention was to get a dialogue started, you succeeded beyond your expectations I’m sure. I read your article and I was impressed by your clarity and passion. I have also read all the impassioned responses, some of which are informed and others more emotional based. To give you a small bit of background to preface my statements, I have been in the business 40 years and have worked in just about every area imaginable. I’ve primary been a producer. I have built and run several companies in digital sound and VFX and have been closely associated with many of the technologies being used today. My point being I have been around a while. Here’s my point. Of all the comments and things in your article, this is what stands out to me in the VFX world.
    Studios are run by Corporations. Not creative individuals. Their god is the bottom line. That’s all,period.Corporations really don’t care who does what as long as they do it for the money and the schedule. They are pretty obivious to the process, so expecting them to act in a reasonable manner is a fool’s errand.
    Corporations only deal with people of authority. Directors and some Producers get that respect, only because they can deliver what the corporation cares about which is profit.
    The circle get smaller and smaller as the project goes down the chain and finally gets to the people who do the actual work. Many of the creative arts figured this out long ago and got wage and conditions protection from the IA, but because of the “newness” of VFX, this part of the process has been slow to react. What we have now is a bunch of people spending their time complaining about the status quo instead of doing something to change it.
    Here are some suggestions:
    1.VFX houses need to make sure they have a “business” professional running their operation and that these people have a track record of dealing with the corporations in a mutually beneficial manner. This usually requires someone with a hands on producing background that knows the whole process and can deal effectively with the studio, producer and director. Creatives should stay creative.
    2. get organized. Pressure the DGA to take the Supervisors into the guild so that there is a place at the table, both creatively and otherwise.
    3. Why aren’t the artists part of the animators guild. Isn’t that what they do?
    4. Producer and Coordinators should get the attention and support of the PGA in a forceful way.
    This industry needs to become a business if you are going to exist in a business environment.
    Will some work go away. Sure, it is going away now. Do we just wait and let the entire industry crumble while we wait. No.
    As far as subsidies go, it will never happen that those subsidies will ever trickle down to VFX. Will it keep more shows in LA, maybe. It does not guarantee that the VFX work will be done. This is a competitive business in a free market society. No about of tax credits will change that.
    So Folks, man up, figure out how to do it at the best price and realize that for every person working at this minute there are thousands of people behind you looking to take your job. You are not immune because you are in Hollywood. Fight for what is yours. This may take some sacrifice, but everything good does.

  • dbeales

    VFX houses & video game developers really need subsidizing to help them stay afloat. These people need patronage. Workers in these industries are extemely hardworking, talented, and dedicated artist, engineers, and scientists. Most are not very good businessmen. Db

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