What I tell myself everyday.

To all the people watching, I can never ever thank you enough for the kindness to me, I'll think about it for the rest of my life. All I ask is one thing, and this is.. I'm asking this particularily of young people that watch: Please do not be cynical. I hate cynicism - for the record it's my least favorite quality, it doesn't lead anywhere. Nobody in life gets exactly what they thought they were going to get. But if you work really hard and you're kind, amazing things will happen. I'm telling you, amazing things will happen." - Conan 'O'Brien

August 9, 2011

the economics of animation industry. part 1

I blogged about a very informative post from David Stripinis about the evolution of the VFX business and the current state of the industry.

I thought I investigate about the simple economics of the animation industry.1st, some background.....

We all know the most simple and basic economic model is based on supply and demand. There is a demand therefore there is a need to supply that demand. But also more importantly "they are merely 2sides of the same coin".

Supply creates demand because at the bottom, it IS demand. - Henry Hazlitt

And for this industry, this is the rule. The supply of the things we create/skills (shots, lighting, animation, coding etc..) are all that we have in offer for exchange for things that we want. (promotion, more money, etc.)

Similarly for studios it is reputation/money in exchange for shots and to be done for the vfx, cartoon, commercial, video games industries etc.....

And for the movie studios and games publishing companies, its bottomline is money for entertainment.

Of course the issue if you will is that we are working on a movie by movie basis or season by season for tv shows. Sometimes, several movies on top of one another if the going is good. The work may not be consistent depending on if your studio gets the project. And if the shows keep coming, the shots need to get delivered. Often with the release date already locked in.

The shows' release dates are locked in because they are competing against other movies to secure those seats in the cinemas. The cinema owners are assured that there are shows to fill the seats. And they all want hopefully the best selling movies to make the money.

For the movie studios, the more cinemas they get, the more chances they have to sell the tickets. Again provided the movie can sell. Hence the marketing budget for big budget movies are often huge in order to protect their investment. So for the artistes, once the release dates are set, they are often never moved.

This is the nature of the business

At the end, we are creating elements and vfx for the studios that are selling entertainment at $10 a pop to the guy of the street, his neighbour, etc. 

Similarly, animation studios pitch and create animation series. Sometimes with funding secured by the tv stations or networks. Sometimes with private investors. Toy makers etc... 

Unfortunately there are a finite number of hours programming on the TV station, finite number of cinemas and dates that the shows can run.
And there are ever increasing numbers of shows being pitched, in producing, trying to get sold etc.... all trying to compete for a finite number of options.

You would think that with ever increasing number of choices, the quality of shows out there will increase to better the competition. But as we know the inverse is true. The movie studios, the animation companies hedge their money on safe bets. Sequels, recognized names etc. It is the nature of humans to want to be safe. And this at the end of the day becomes the demand. When there is over supply, they will have to meet the demands of the networks, the movie studios etc. Which are all safe bets.

Of course on the other side is the technology of the business. The latest gizmo/CG techniques that are suppose to be on the cutting edge. Stuff that get published in siggraph papers. All these sell to the movie studios, the ability of the vfx studios and of course attempt to sell movies and games. "Come see the amazing ability to age a man digitally in reverse!" "Come see a whole planet done in the computer inhibited by blue cat like people" "See how we make a hollywood hunk turn into a 70 pound weaking." "Photoreal Realtime renders of trees and water, with everything destroyable!"

Reminds you of the circus. And it is quite a spectacle. I do not mean it in a negative connotation but more of the wonderment when u see it for the 1st time. And I think the technology plays a part in attempting to capture that feeling.Of course the quality of the game/movie is something completely separate.

The major differences between the different types of industry that you are in of course results in different demands and requirements.

And now the competition as well as career opportunities are worldwide.

Part 2 Coming soon.

1 comment:

  1. Studios are always hiring and on the lookout for talent. Especially hungry, talented and hardworking individuals. Even in the US/UK, it is a internationally diverse mix. There will always be opportunities to work at these places if you are good enough.

    Alex Frisch