If you read one article on the VFX industry this year then you might want to check out Film Works LA interview with VFX facility Rhythm & Hues. In my opinion it’s the article of the year because it reveals so much inside information about the business:
More interesting yet, Berger said Rhythm & Hues could often match a bid from Vancouver for the same money even using his California artists. “But what has happened in recent years with many studios,” Berger said, “it’s easier to understand the tax credits than it is to understand a discounted price.”
Think about that. No matter how efficient or competitive your VFX facility is, you are at the complete mercy of a government offering a subsidy. Even with a huge 35% subsidy in Vancouver, California VFX can still be competitive which is something I’ve said for a long time. I’ve seen people lose their homes, their families, and their careers over something so absurd.
Simply put this is why subsidies violate many trade agreements. They are a form of protectionism that create a barrier to market economics.
You can read more at Scott Squires blog.