Under Siege: Special Effects Studios Rise-Up Against Ruthless Industry Exploitation and Outsourcing

Over the past 20 years, special effects houses (typically known as VFX studios) have risen from an occasional tool used in science fiction or fantasy movies to a mainstay of the entire industry. The term "VFX" refers to more than the use of Computer Generated Imagery (CGI) -- it also references live-action shots or green screen uses where actors are overlaid with real scenery or backgrounds that are filmed in different locations. Thus, even a movie that takes place in "real life" can rely heavily on VFX.

Given that most Hollywood movies now rely so heavily on VFX, you'd think that VFX studios would be the toast of the town. Instead, they've been under increasingly desperate pressure. Rhythm and Hues, the Oscar-winning studio behind Babe, the Golden Compass, and Life of Pi filed for bankruptcy last year after winning an Oscar for the latter film. Pixmondo, the German studio that won an Oscar for Hugo, was forced to close its London and Detroit branches.

The Avengers' iconic battle for New York looks a bit different than I remember it.

You might think that these closures reflect the box office take for the films in question, but that's not true. What's happened, instead, is that the Hollywood studios have viciously pressed VFX houses -- refusing to pay for multiple renders of a scene, refusing to pay for weeks of overtime, and threatening to use foreign VFX businesses if domestic ones won't compete on contract costs. The problem there is that these same foreign companies are often heavily underwritten by grants from their respective governments.

Hollywood has gone to great lengths to keep this problem under the radar, deliberately cutting off Bill Westenhofer's acceptance speech for the Life of Pi's Oscar in an attempt to silence him. The VFX industry's fight against unfair offshoring of their talent, however, has just gotten an unintentional boost from the unlikeliest source imaginable -- the MPAA.

How The MPAA Handed Artists A Gold Mine

In a recent amicus filing to a court case involving 3D printers, the MPAA strongly argued that goods transmitted digitally as "articles" should be considered to be governed by US trade laws and subject to strong protections against foreign subsidies and unfair pricing. According to the letter, "The use of electronic means to import into the United States infringing articles threatens important domestic industries such as the motion picture and software industries, as well as U.S. consumers and the government at all levels."

In other words, "Just because something is transmitted over the Internet shouldn't mean the US government shouldn't offer strong protections to intellectual property." In a statement to PandoDaily, the MPAA reiterated this position, saying: "“Congress has given the ITC broad authority to protect U.S. industries from unfair acts in importation,” said spokeswoman Kate Bedingfield, adding that if the government doesn’t recognize digital products as imports, “American businesses lose an important protection, which puts them at a significant international disadvantage."

But if that's true, then the work done by VFX studios shouldn't be subject to subsidy-busting, either. At least, that's the hope of the activists who plan to march this Sunday to call attention to the problem. A recent blog post from Nvidia -- it broke while I was writing up this story -- actually highlights the degree to which Hollywood now depends on digital technology, including digital effects studios by highlighting the fact that filmmakers are increasingly moving away from celluloid -- unfortunately, they've done so while simultaneously squeezing the talented individuals that make the transition to an all-digital world possible.