Tough Times In Australia

A bit of slightly good news and very bad news this week for the Australia VFX market.

Reporter Brendan Swift has been doing some excellent coverage of the Australian VFX industry. This week he ran an article on Dr. D Studios that created Happy Feet 2 and was slated to do the new Mad Max film. The good news is the company actually made a profit however it’s future is doubtful:

Dr D Studios posted a net profit of $8.79 million last financial year, according to financial documents filed with the corporate regulator. However, the future of the company remains unclear following a production lull in the wake of Happy Feet Two.

This week also saw the cancellation of Alex Proyas’ Paradise Lost which looked like it was going to be a very big film with lots of VFX. The huge film subsidies the Austrailian government offered Legendary Pictures was enough to get Digital Domain to open a facility in Sydney but it still wasn’t enough to get the film green lit:

A government spokesperson said a planned Sydney office for VFX house Digital Domain will no longer be opened. Digital Domain was set to create the bulk of Paradise Lost‘s effects and was also an investor in the film.

The slightly good news is that Digital Domain will send some work on other to Australia.

Part of the problem is that the Australian Dollar is at an all time high against the US Dollar (or the US Dollar is at an all time low depending on how you want to look at it). This makes it more expensive for US Studios to do work there, even with the huge subsidies.

Soldier On.

7 Responses to Tough Times In Australia

  1. tristan says:

    It’s interesting to watch the trend of vfx heavy films being co-produced by the vfx houses themselves… and what happens to when the films fall through.

    • composer says:

      Seems like the last act of a desperate company…compound the risk of running a business by then leveraging it to further invest in an even riskier business. Only works if you’re investment banker…

  2. allen says:

    there’s word that they’re officially closing this week or next. we shall see.

  3. Ned says:

    Is anyone aware of the specifics of the incentive package that the Australian government is offering to the studios?

  4. dave says:

    Good old Dr D, Its such a shame that some of the good people who worked there now suffer the loss of their jobs and have to move yet again. In many ways thanks to the clueless & pathetic hire your unqualified buddy as a supervisor culture.

  5. Mel says:

    Animal Logic made Happy Feet 1, Dr D did HF2.

  6. MS says:

    Importantly, the profit Dr. D. posted was for the last financial year, and so most likely doesn’t include the last four or five months of production when a *lot* of money would have been spent on the final push.

    For those interested about the incentives offered in Australia (and in particular NSW) have a read of the link below. It is (one of) the letters sent to the state government to ask for funding for Paradise List. Makes an interesting read I think.

    http://www.dpc.nsw.gov.au/__data/assets/pdf_file/0005/134384/Disclosure_log_DPC1102426.pdf

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