Los Angeles feature film visual effects industry in full collapse

All good points.

 

Who no doubt pulled the ripcord on his golden parachute on his way out.

 

There is a tax incentive program in place which I have personally benefited from, but it is too small at $100 million annually. However this past summer a larger $330 million annual tax incentive was signed into law, it takes effect July 1, 2015. Had this not happened it would have been game over for the industry.

For me personally the past five years have been very uneven, while I used to do mainly feature film work, I now work mainly in television; feature film work in the L.A. area has largely disappeared and new TV series are mainly done in New York and Vancouver. Of note I'll point out that the salaries in New York of below the line crew are significantly higher than that of their L.A. counterparts (avg. $1000 more weekly!), yet that hasn't stopped the stampede of network TV series work done there, the $410 million dollar annual tax incentive makes the numbers work for them.

On the bright side it looks like a fair number of Pilots for new shows will be filmed in L.A. this Spring, I take that as a sign that the Producers are looking at the upcoming tax incentive as the lure to do the series here should it be ordered by the Networks. That said I'll really believe things are getting better when I see features done in L.A. again I n significant numbers. In practical terms they pay much better than TV, and life in L.A. is much more expensive than it used to be.

 

What kind of salaries are we talking about? I ask because $1,000/week = $52,000 a year, so the difference you're talking about is higher than New York City's median income of $50,711.

 

In New York, $4K to $5K per week, but bear in mind that's a minimum of 50 hrs per week and for many 60 hrs+, this isn't 9 to 5 territory. Also most don't work 52 weeks per year, more like 8 to 10 months at best if you're lucky, so the of time must be taken care of from your regular earnings. For L.A. workers things have been much worse for the past 5-6 years. For many a good year has been 6 months of work, which does not support your family through a 12 month year.

 

What goes around comes around. I remember a few years ago when plenty of LA people didn't care about the future of the American Auto Industry.

Having said that, I don't want anyone to lose their jobs, especially good forum members like Vidiot.

 

Many people in the film industry work 50hr per week anyway.
$4k to $5k a week?! How many people get that? Doing what?

 

I know VFX supervisors who get more than that. Or at least used to. $3000-$5000/week for colorists is a pretty standard rate, but it's come down somewhat in the last five years. And there are top people who get many times this salary. I know of at least five LA colorists who are making 7-figure incomes, and another half dozen doing half a mil a year.

 

Good to know. In my next life I would like to be a colorist.

 

Those numbers are for people who are working. For every colorist working, I think there's 10 former colorists who are flipping burgers. I'm lucky to be working at a modest wage these days...

It's not too far removed from the animation business, where lead animators at Disney, Pixar, and Dreamworks were commanding $500K salaries. Not no mo'. And there are far fewer animated pictures being made, too, so jobs are relatively scarce compared to what it had been in the last 10-15 years.

 

Some say that Hollywood jobs are recovering due to digital productions...

http://www.latimes.com/entertainment/envelope/cotown/la-fi-ct-hollywood-jobs-20150210-story.html

 

In my world these figures are solely for really big names.
Lead animators at Dreamworks earn $100k plus. That's all. I was there for 12 years as a directing animator and earned nowhere near that kind of figure. Not many VFX sups I know earn that either.
It didn't seem that long ago that ILM was paying VFX supervisors $30 an hour.

 

I'm referring to Art Dept. personnel below the Art Director level specifically in New York. We all work at one rate whether that's for set design, illustration or graphics. As I stated in my original post, the L.A. rates are at least $1,000 or more below the New York rates. TV rates have always been less that that of feature films due to the higher guaranteed hours per day or week for a film over TV. It's in the overtime that your salary really bumps up. With the loss of films in L.A. that has meant generally doing TV work paying $800 to $1000 a week less than a movie would. Also bear in mind Pilots and new TV shows always pay the previous year's rates for their first two years on air if picked up by the network.

 

I know there were VFX supervisors at Cinesite (circa 2002-2004) making $5K-$6K a week, but this was for a 6-month project and then they were laid off. And maybe the entire film had 3 of these guys. So there are many stages and levels.

I don't doubt there's assistant compositors and i/o people making only slightly above minimum wage. There were PA's running around the building making maybe $12-$13 an hour for sure.

I really, really wish the VFX industry had tried harder to unionize in the 1990s, when it would've made sense. But you can make a good argument that this might've inspired the studios to take all the work overseas even sooner.

I think I said earlier in this thread that if the studios could take 100% of the work -- especially editing, sound mixing, VFX, color correction, and so on -- out of the country, they would. Hell, if they could shoot the movie entirely with 3rd-world employees making 1/10th of what Americans make (or employees in London, NY, Sydney, Vancouver, or any other major production area), they would. The day they can replace all actors, sets, camera operators, and all technicians, they'd love to do it.

The IA union rates are supposed to be identical. I know for a fact they are for the camera crew, sound crew, and editorial crew. I don't dispute there are very good people who make over scale. Even I make more than scale, and I'm working on tiddlywinks projects at the moment.

 

I'm only referring to the scale rates for those New York Art Dept. positions, I don't have knowledge of what other departments pay. In L.A Art Dept. rates are all over the place without any sane rationale, but it's only in recent years that all of the Art Dept. crafts have come together in one local. The IA rates in the south are much lower and all of us here on the coast have lost loads of work to Atlanta and New Orleans, etc. The studios only agree to travel us or let us work on a Southern show from home when it's essential.

 

The Big Three went into a tailspin when they continued to produce uninspired, unreliable, inefficient vehicles that couldn't compete with import marques that started building more and more vehicles in the US, mostly in right-to-work states. So their problems came from not just a higher cost of labor but a quality gap in the finished product.

 

And as a side-story to this terrible problem, Dreamworks announced today they're going to have to close their lavish studio in Glendale after posting almost $250 million in losses last year...

http://www.thewrap.com/dreamworks-animation-loses-247-million-in-q4/

The Penguins movie and Mr. Peabody & Sherman really tanked, as did several movies before that, so it hasn't helped. Apparently, they're going to sell their building and move to smaller leased offices elsewhere. This comes only a month after they announced that they're shutting down PDI, their Northern California facility.

The VFX and animation industries are very similar in that they both employ lots of talented artists, use massive amounts of computer power, take tons of time to do the work well, but producers constantly want to cut costs, forcing these industries to send the work overseas to 3rd-world countries with relatively low-paid workers.

 

This kind of says it all, doesn't it?
"The under-performance of 'Penguins of Madagascar', a November release that has grossed $82 million domestically and $275 million overseas, also hurt."
Any movie that takes in over 350 million dollars & UNDER-PERFORMS is a sure sign that somebody is getting funny with the money. Wow...

 

It is all relative. $82 million domestic is REALLY, REALLY BAD for the type of animated feature.
DWA is in deep ****. Jeffery Katzenberg is not trying to make more money, he is looking for ways to survive. 'Home' looks like a sure fire flop as well, their trouble will continue.

 

I wonder if Mr. Katzenberg has taken a pay cut at Dreamworks to control spending?

 

Well, he has- he is not getting a salary.
Of course there are shares and other means. ;-)

 

Penguins cost $152 million and made $358 million worldwide. That's not enough to break even. Consider that the studio gets to keep only about half of the box office gross coming from the theaters, so we're already down to $179M. Then they probably spent $75 million to advertise and promote the film, so we're now down to $104M. And don't forget the interest on their original $152 budget, which keeps rolling-rolling-rolling. If the movie really cost $152M, then they clearly lost a big chunk of money if only about $104M was left after the dust was settled. This is particularly true for movies that cross $100M, where the risk is even greater. The breakeven point is basically 2.5X cost, so if Madagascar had made $380M, it would've not lost money. Bear in mind that the studios don't like movies that just break even -- they were expecting Madagascar to make closer to $500M, which would have been a tidy profit.

But when you have a film like The Fault in Our Stars (not that it's a great film, but it was very successful), which cost $12M but made $304M... that's a huge, huge profit by any definition. Anytime you make more than ten times the film's cost, the studio execs break open the champagne and go absolutely nuts. I'm sure they're beside themselves that they can't make a sequel, since at least one of the characters didn't survive.

 

I am not even sure if Dreamworks get to keep half the box office money. DWA were tied to the Paramount distribution deal for years when they got almost NOTHING from domestic box office and had to rely on DVD sale a lot.
They have a better deal with Universal now. Still, with the production cost so high, they have to make every movie count.

 

Either way, losing an animation division at any studio is a bummer. IMHO these types of pictures are enjoying a real renaissance & my kids love them.

 

Penguins and the other Madagascar films were distributed by Fox, but yes, DreamWorks would not be able to keep all the box office revenue. Fox has DreamWorks Animation locked up until 2018; the live-action films are distributed by Disney (since 2009), after the Universal deal fell through. But either way, it's true that DreamWorks doesn't control their distribution and has to depend on larger studios and corporations to get their pictures into theaters.