VFX Is All Going To… San Diego?

I came across an article (paywall) that reported San Diego 3D conversion company Legend3D has approached the mayor of San Diego to lobby for tax incentives. The hope is to attract 5000 (yes, 5000) VFX professionals from LA and other locations to convert various studio film libraries into 3D.

The mayor has put together a task force to look into the possibility. However as much as I’m sure many VFX professionals would love to soak up the fun and sun in “America’s Finest City”, I have to be incredibly skeptical about this.

First off, the current subsidy race is incredibly expensive. Even California which supplies film subsidies to lower budget productions, has been criticized for being uncompetitive:

California’s program is uncompetitive with locations such as New York, Louisiana and Canada that offer $400 million to $500 million per year in subsidies, have no caps and offer much higher percentages.

Furthermore, Legend3D’s business model is pretty risky. According to the article they offer to convert the studios’ libraries for free with the promise they get a portion of the revenue on it’s release. In this biz, it’s expected that the backend deal is a suckers bet.

The lofty goal of luring 5000 VFX professionals is admirable but in a cyclical industry, people need to be able to jump to other places and San Diego doesn’t have that. That was sort of the problem with Sony New Mexico.

Finally, it’s important to note that Legend3D has also had a partnership with various facilities in India to employee over 800 workers to help in the conversion process. If VFX is supposed to go all to India why is there such an ambitious attempt to get 5000 workers to do it in San Diego? Perhaps because even supposedly trivial tasks like conversions require well paid artistic and technical professionals?

Soldier On.


16 Responses to VFX Is All Going To… San Diego?

  1. To be clear, the article and the objective focuses on all areas of VFX. Conversion is only a small part of the effort. Legend3D’s studio in India allows the company to maintain a very large and expanding work force in San Diego where all creative aspects of the process happens. The mayor of San Diego understands that outsourcing is not a black and white issue. Unlike other conversion vendors, we are committed to remain US based in San Diego and LA. Our technology is sufficiently efficient to allow us to maintain our base here in this country. San Diego is only a 2 hour drive or train ride from LA. New Mexico is on another planet in comparison.

    • VFX Soldier says:

      Hi Barry,

      Thanks for commenting clarifying info on your company. I don’t have anything against anyone who wants to do work in India. My comments are directed at those who readily use scare tactics to say that all VFX work will go to India. I used your commitment to hire a large number of local vfx professionals, which I compliment, to exemplify that while you send some work to India, you also need a large number of workers here.

      If VFX professionals had to move I’m sure San Diego would be one of the first choices: It’s a beautiful city, low cost of living, great place to raise a family, and the weather is nice. However, how competitive would the subsidies have to be? How long do you expect them to be in place? Is your company currently subscribing to the business model described in the article? Has it been successful?

  2. Gregory Duncan says:

    I can tell you right now there is no way they will be able to get enough work to hire 5000 people. I’m talking about them doing 3D conversion and vfx. It’s hard to sell converted library titles. I’ve seen how much work it is to sell one. They are also fighting the bigger studios to get the vfx work. I love San Diego it is a great city but where are they going to find 5000 people to move there to do mostly conversion? Just sounds like another city that will lose some more tax payer money if they agree to it.

    • VFX Soldier says:

      But Gregory, you’re in Singapore which also heavily subsidizes VFX and is one of the most expensive cities to live in. If presented with an opportunity to work in San Diego or Singapore would you have still be inclined to go to Singapore?

      • SingaporeFX says:

        Do you have information on how much studios are getting for VFX subsidies in Singapore? I’d love to find out more.

      • Greg Duncan says:

        Yeah I will still be inclined to go to Singapore. At the end of the day living in singapore is saving me more money than LA. Also living in Singapore that has a upside than anywhere in the US. You can travel to a dozen other countries for little money. Also unlike San Diego Singapore has other companies that I could go to and work for. Within the next year or two they will all be on the same block out here. That is the problem I think Sony ran into when trying to get talent to move out to Albuquerque. They were the only ones out there. When a contract ends you want a place you can land on your feet.

  3. Muren says:

    pricey town(s) make being an artist and a happy worker that much harder. ABQ sure was a nice medium. maybe the studios will pay us more in those expensive locations? dont spit or heaven sake dont be too creative in Singapore…You could get some lashings. maybe VFX schools have nailed it home to the kids these days how to dress, act and even think…But I dont see success from any of these places like Singapore? So damn clean but so full of shit! Any studio willing to let-go of the suits and ties and get on with the art of animation will reap the benefits. Keep those god damn clean cut well shaved assholes away from the creative process. It worked for Rango.

    • VFX Soldier says:

      Wasn’t 25% of Rango done in Singapore?

      • Greg Duncan says:

        I can tell you I work with harder working people in Singapore than I did in the US. What studio do you work at that you wear suits? I’ve been wearing shorts and a T-shirt and sandals since I moved out here. So does everyone I work with. I couldn’t tell you the last time i saw a tie. You can’t spit but I don’t know a cop that would arrest you for it.

      • Muren says:

        Im sorry but as long as spitting is illegal and many things we get away with here in the states are considered taboo…I dont see great things originating from Singapore. i’d love for Asia to prove me wrong but compared to Cali and Canada its not creative friendly. Not the majority of artists who I know at least. Maybe i should correct myself. The suits and ties are what the executives wear…Along with a little white mustache…All comes down to a MAJOR disconect between those who make the movies and those who fund them…For the most part we’re all on entirely different wavelengths…Nothing like what made the movies we grew up with…Not the successful ones. Theres a blindness in American corporate culture that allows our creative studios to move to Asia. If Asia wants animations they should be able to make them for themselves…It makes absolutley NO sense other than profit to force this sort of outsourcing. And…In the end its goinf to be proven that it destroys both our abilities to make quality products. Call it what you want…Moving to Asia wont work for people who are sane…people who are true artists wont permanently move away from their families to work for a VFX studio in an entirely different country so damn far away! Its insanity…Only a select type of people will make that move…Its gross that any of Rango would have been done like that and its not the recipe that made RANGO great…Think of animation like food and you’ll quite quickly understand how its not really a good idea to do the whole overseas thing…I dont care how much teleconferencing, etc you have…People need to be people and we wont realize how un-human we can become…How MUCH BETTER our product could be…Will be and should be. Theres plenty for everyone…

      • Muren says:

        Its sad that A lot will feel Im preaching against sharing. Im preaching for creative integrity. When will we realize that the best work will be done when everyone is at their comfort zone and not stressed beyond belief? That what we do requires patience and concentration? That a team functions best when all on the same page? I say screw the big studios…I do hope they collapse and somehow break into lots of medium ones, smaller ones, etc…Dont know how this would happen but considering how much crap ends up in our theaters these days I see no loss if this happened. So many great stories to be told…Not always retold and prefabricated…So many great authors…And a huge gap between Box office and Independent. that could be the future for all of us. This reality -show nightmare…might onenight come to an end? Lots of humans to entertain and their getting bored with the crap Hollywood is feeding them. A new day awaits me thinks, hopes, Que Sera Sera…

      • singaporefx says:

        @Muren Your comments on Singapore are quite disparaging. You really shouldn’t be so harsh on Singapore till you’ve been out here and lived here. We’ve got a very fair taxation system. Some of the lowest crime rates in the world. Highest number of millionaires per capita. One of the best education systems in the world. And a government that actually has savings. It’s had over 40+ years of surpluses.

        People here question why you would want to live in the US. People can own guns. The political system is broken. Health care is insanely expensive. Public Transportation is horrible is most cities (especially in LA) There is estate tax and capital gains taxes. (both of those don’t exist here) And income tax can go as high as 50% in some situations.

        My point is, there are pro’s and con’s to every situation. At the end of the day we’re all trying to work and make a living.

        Your comment about Rango being partially produced in Singapore is incorrect though, and I wanted to point that out. Rango wasn’t “outsourced” to Singapore. It was “in sourced” to Singapore. ILM has offices in both SF and Singapore. The Singapore office handled 25% of the work and that’s that. That’s like saying Sony Imageworks “outsourced” to New Mexico. Both of those offices belonged to Sony and were helmed by Sony Employees. I’m sure they had the same pipeline and the same tools.

        Just because one office is at one location and one is at another doesn’t necessarily make one inferior to the other.

        Is one starbucks better than another, just because one is in Seattle and the other in Florida? The answer is sometimes, but not all the time. If both of them have the same coffee beans, what matters most is the people and the skill of the people working there.

        I agree with VFXSoldier, studios and facilities should stand on their own and do what they can w/o subsidies. As long as the subsidy system is in place somewhere, then facilities will go to that locale. Who cares if a job is in Singapore, LA, London or Mumbai? If there are talented people there that are willing to do the work, let the work speak for itself.

        In the meantime, I’m still trying to figure out “If” and “How much” facilities are getting by being out here. From my sleuthing, it seems like it might not be a film subsidy to the studios. But more along the lines of grants or loans from the government to facilities. If that’s better or worse, only time will tell.

  4. . says:

    It’s unfortunate that everyone seems to be missing the point of this post.

    A) Companies continue to want to be in California more than anywhere, even given the hugely aggressive tax breaks elsewhere. Why? Because workers want to be there, and nothing will get done if you can’t hire good people.

    B) Given the current state of California’s budget, these subsidies will likely not be competitive, or long-lasting. That means that anyone who moves there is taking the risk that the company will move elsewhere when the subsidies are (IMHO, inevitably) cut. It does nothing to halt the race to the bottom. That’s a pretty terrible way to do business.

    And I’ll add my own $.02:

    San Diego is not Los Angeles. It’s a military town with enough glitter to attract tourists, but lacks the diversity and culture of a real city. As an east-coaster I can’t stand the place, but maybe if you like caricatured beach culture, lifted pickups, frat bars and foreclosed loft condos, godspeed.

    It’s important to distinguish between San Diego County, which is beauty, and the City of San Diego, which is… not.

    It is a bit poetic that a city essentially built on government-sponsored industry would try it’s hand at shot-in-the-dark municipal entrepreneurialism.

    VFX studio executives: when you want your project to get done, you call guys like me and my friends. How many times do we have to say the same thing? The only reason we’ll ever leave Los Angeles or San Francisco, even for just a project, is if you pay us so much that we can afford to never do it again. The ‘brain trust’ you’ve ‘invested in’ is a joke, please stop insulting our intelligence.

  5. Point of clarification first: I worked with Legend on Transformers and do some consulting with them but have not been involved in the call for subsidies or current business plans.

    My understanding is the plan would of course apply to any visual effects company in San Diego area, not just Legend. There are some game companies in the San Diego area as well as a number of high tech companies so there’s potential there.

    The other thing to point out is Legend did employ 400 – 500 people near San Diego, even with India’s involvement. The creative and technical work was primarily in San Diego and some of the more labor intensive tasks were in India as expected due to cost of labor.

    What the details of the plan are, how far it is to becoming a reality and how successful it might be I couldn’t say. 5000 people is a lot and likely far more than the VFX business would provide in San Diego. Maybe games and other companies in San Diego could utilize similar people and talent.

    For anyone LA based, San Diego would be a nice option instead of being forced to move half way around the world. and I think that is one of Barry’s reasons, to try to keep the work at least in southern California versus going to other states and countries. if they can make it work without causing a real loss in LA, great.

    Personally I would like to see all places succeed based on their abilities and their service (quality, cost, etc) External factors such as incentives create artificial influences to the process and tend to simply fragment the market and the labor pool. If the erosion of LA work continues then it will be difficult to restore and ultimately be a loss for the studios, who are focused only on the short term.

    Don’t get me wrong – if you want to live and work elsewhere (Vancouver, Singapore, etc) and there is work there, then great. More power to you and the people there. I wish there enough interesting visual effects to employe artists all over. If the main reason an area thrives is simply because of incentives then that’s not a good situation. What will you do when the incentives go away? It will happen. What will the companies there do if they’re now more expensive than elsewhere?

    Hollywood thrived because the studios clustered here for the weather and other factors. That meant more work, more jobs, more skilled workers, etc. People in the motion picture industry have very specific skills so it was great to have multiple potential employers. If you finished a project at one studio then another project would likely happen within driving distance at another studio. You could raise a family and have a home without having to worry about moving every couple of years.

    People came to Hollywood because that’s where this type of work was and because they wanted to do that type of work. In the very early days when the move from NY to LA happened there were likely people who had to move or they lost their jobs. But for decades Hollywood was able to maintain a reasonable balance. Now it’s as if the rug is being pulled up from the people working. We’re now migrating like herds looking for the next water hole simply because of political agendas. Visual effects workers are the ones taking the brunt of that approach and the studios (not the companies) are the winners.

  6. Paul says:

    Well in any case and as everything else for the past 30 years or more you design in the northern hemisphere you manufacture in the southern. Vfx or Car or Ipad7 same shit. And by supporting that people be treated fairly with better wages in Asia for ex. you’re shooting yourself in the foot and being, yes one more time, a useful idiot. Harsh but true. In few years Foxconn employees will enjoy more benefits and better work conditions than any factories in the US. How funny that we’re told to whine for those poor bastards when I shall be happy that my health premium is only $350/month.

    And San Diego please…where’s my uniform?!

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