Tuesday morning I woke up early to do an interview with the BBC about the VFX industry. I argued that while the UK is benefiting from recent increases in subsidies for the film industry, I warned that Canada was offering much larger subsidies that pay 60% of labor wages.
A few hours later I get contacted by some people in the UK with indications that Prime Focus would shut down their London office after the email above was sent to employees. One would suspect the reason why an Indian VFX firm like Prime Focus would shut down operations in London was to ship more work to India but that was not the case. The email clearly confirms what I told the BBC earlier that morning: The subsidies in Canada are larger and US studios that receive them have demanded more VFX work be sent there.
For films that pass an EU mandated cultural test, productions can take advantage of a government subsidy that pays 25% on the first £20M and 20% on the rest of expenses in the UK that are capped at 80% of the total qualified expenses. What makes the UK subsidy very special is that it covers above the line talent salaries such as actors. So it’s quite probable that 20% of Sandra Bullocks $70M payday for Gravity may have been paid by UK taxpayers.
What’s not so nice for VFX is that the above the line talent and physical production costs can quickly hit that 80% expense cap which the Prime Focus email alludes to. While Canada doesn’t offer to pay above the line costs, they offer to pay the wages of VFX labor that have established residency. No caps, no cultural test, no other requirement that could be a big hurdle. So you can see why it makes sense to do your shoots in Louisiana, Georgia, and the UK where above the line talent is subsidized and go to Canada for VFX.
The Freight Train Mentality
In another part of my interview with the BBC I explained that many artists in the industry suffer from what I call the “Freight Train Mentality”. I’ve found that when it comes to subsidies many people ignore my predictions because it initially benefits them but when they finally get run over by the reality that some other location is willing to offer more or their subsidy program falls apart, they change their tune on subsidies.
That realization became very apparent for a few people at Prime Focus London who were very much against my efforts. Just last week an artist called me out on twitter which I’ve posted a few snippets. I think it’s an important teachable moment:
It turned out the artist above was a PFL employee and admitted he had no idea how quickly things could have turned and retracted his statement. I told him no hard feelings. There were also staunch opponents who may have changed their tune also. If you remember some people were so motivated in derailing my efforts that they tried to find out who I was when I was blogging anonymously. The hope was that a threat of blacklisting would somehow intimidate me. Well even some of those people have come around after yesterday.
Some of them were people who not only acknowledged the subsidy race but endorsed it a while ago:
I am in London, and benefitting directly from these subsidies. I plan on going to Australia, New Zealand, and possibly Canada for work.
I chose this industry precisely because it allows for international mobility.
If the susbsidies are stopped what reason do California located film studios have for outsourcing work to far off lands like London or Sydney, with massive time zone differences and no appreciable gain in quality? None.
So don´t count on my support for this anytime soon.
The person who made the statement above was also a PFL employee. My guess is things quickly change when you fall in love and marry. Sorry that this happened to any of you but I hope you understand why I feel passionately about this issue and why it’s practically impossible to continue working in this industry with an expensive and permanent cycle of displacement.
A Facebook friend said it best:
You can tap dance around sympathy until empathy punches you in the face.