In the same week that ADAPT announced an end to its legal effort, DreamWorks Animation announced the closure of PDI and the shedding of 500 jobs. Sad news and you could cut the irony with a knife.
ADAPT’s legal effort to mitigate the use of subsidies started at DreamWorks Animation last year when President Obama visited to incorrectly tout job growth in the industry. We hoped to raise attention to a collapsing local VFX industry. Companies were being put out of business by massive price distortion caused by government subsidies and workers were losing their jobs and having to chase work around the world in subsidized locations.
Given the relative stability at DreamWorks as opposed to VFX vendors who don’t own the intellectual property they work on, it was no surprise our plight was ignored by many workers there. We felt what they were missing is that as good as things were at DreamWorks, it was common for places to go through downturns and that there was a need for a healthy mix of VFX vendors like a Sony Imageworks, Digital Domain, or Rhythm & Hues to pick them up. Not anymore, that ecosystem of work was destroyed by subsidies and ADAPT hoped to resolve the issue with a legal effort.
The irony doesn’t stop there. It was announced that DreamWorks would be outsourcing the work for an upcoming film called “Captain Underpants” not to India, not to China, but to Canada where, you guessed it, DreamWorks will be able to take advantage of huge government subsidies that cover up to 58.4% of resident labor costs. Jeffrey Katzenberg was probably the biggest financial supporter of President Obama who campaigned against Mitt Romney for allegedly supporting “tax breaks for companies that ship jobs overseas”. Now Katzenberg will be receiving massive tax subsidies for shedding jobs in the US and sending work to Canada a year after the President visited his company to tout the growth of US jobs.
It’s also worth mentioning for those that thought the work would go to India and Shanghai that India was supposed to do all the work on films like “Penguins” and “Monkeys in Mumbai” (which was also canned today) but most of that work came back to be done in California. Shanghai (where labor costs are much higher than India) is almost a completely separate company that isn’t even fully owned by DWA. The pipeline is completely different and they are working on local content only.
For those who are looking to blame the costs of unionization should consider that while Glendale was a unionized facility, PDI was not and it was shut down. If unions we’re the anchor that was preventing success as some would like to argue, then it would have made sense to move the workers from Glendale to PDI.
Also, for those hoping that the recently passed California film subsidy bill AB1839 will bring relief should know that animated films are not allowed to receive the small subsidy which requires principal live action photography to be done in CA.
Lastly, for those who routinely use the tired line that VFX companies need to create intellectual property to survive remember: DreamWorks successfully created intellectual property and very well reviewed movies for years. Even they aren’t immune to a financial market that expects grand slam hits every time they step up to the plate.
In the end I’m left asking myself after all these years: “Could I have done more?” and then I answer “Perhaps that’s a question those who ignored us should be asking themselves.”