"You know, we run this company for the people," says John Hughes, "and then to hurt them so badly ..."
If you were paying attention to the Oscars this year, you may have noticed hundreds of special effects artists picketing the ceremony. It's the second year in a row this protest has happened; last year many of the protesters were employees of Rhythm and Hues, the company behind Life of Pi, which took the Visual Effects Oscar in 2013. Rhythm and Hues declared bankruptcy 11 days prior to the ceremony. The documentary you're seeing here is its story, Life After Pi. This is how a special effects studio dies.
It all comes down to chasing tax incentives. Jobs and money are being siphoned off to Canada, Australia, New Zealand and elsewhere, forcing special effects companies to open up expensive subsidiaries in those locations to compete. Except the money never stays in one place since everyone's offering bigger and better tax cuts, forcing those same companies to shut those subsidiaries and start chasing after another tax incentive locale. "You essentially have a trade war occurring," says Daniel Lay, a special effects veteran. Many VFX professionals want to see duties levied on these subsidies, to lessen the impact of the subsidy race.
It doesn't help that the industry operates on fixed bid contracts, though the work itself is fluid. The studio can change its mind at any time, demanding extra work without offering extra compensation. "The shots change dramatically," says John Hughes of Rhythm and Hues, "easily half of the shots that we bid could disappear and be replaced by other shots." Part of the problem is that the VFX industry doesn't have anything like a guild or union, leaving it exposed to strong-arm tactics, particularly over budget and costs. It lacks lobbying power, or any real representation, despite being a major part of the industry. "Without us," asks Lay, "what do you see on the screen?"
Perhaps that will change. Daniel Lay and others have formed an organization, ADAPT, to challenge these subsidies. Only time will tell whether it will succeed.