Two VFX shops scale back; Rhythm & Hues finds a buyer

Pi-lifeboat

Image Credit: Twentieth Century Fox

The troubled visual effects industry is facing a major shift, as three VFX shops announced major changes Friday, including the buyout of Life of Pi’s visual effects company Rhythm & Hues.

EW gave you the low-down on the struggles of the VFX industry that have been getting a bigger spotlight since Rhythm & Hues filed for bankruptcy in February. Here’s an update with the latest on three visual effects shops whose collective work includes Life of Pi, the Twilight Saga, and Doctor Who.

Rhythm & Hues, the VFX company behind the Oscar-winning effects in Life of Pi, started its bankruptcy auction earlier this week and has found a buyer. Friday afternoon the U.S. Bankruptcy Court approved the winning bidder, a holding company for Prana Studios, a VFX and animation company with offices in Los Angeles and Mumbai, India. A Hollywood Reporter analysis valued the deal at $17.8 million.

The acquisition follows other recent purchases of VFX companies by foreign buyers. Digital Domain, founded by James Cameron, was pulled out of bankruptcy last fall when it was bought by Chinese and Indian companies.

VFX artists from both inside Rhythm & Hues’ ranks and throughout the industry have been waiting with baited breath for results of R&H’s bankruptcy hearings, but even with a new owner decided upon, R&H’s future – and what that future means for the rest of the industry – remains uncertain.

“Everyone’s in a wait-and-see pattern,” R&H employee Dave Rand told EW of the vibe at the company’s Los Angeles offices today. “We’re somewhat shell-shocked. Now the bombs have gone off and the smoke’s clearing, and we want to see what is revealed. We want to see what happens next.”

Other industry members are speculating on what Rhythm & Hues’ new ownership means for California’s visual effects artists.

“It doesn’t bode well for the work here in California,” said visual effects artist Scott Squires, whose work includes Close Encounters of the Third Kind and Star Wars: Episode I – The Phantom Menace. “What we’re seeing primarily is Chinese and Indian companies trying to buy U.S. visual effects companies. They seem to be trying to gather both the prestige that the U.S. companies offer as well as get whatever technology and people and so forth that they can.”

Such purchases, studios’ pursuits of foreign subsidies, and the opening of foreign facilities for U.S. visual effects shops (R&H opened studios in Mumbai 10 years ago and is now preparing to establish operations in Taiwan) have been met with some criticism from various industry members. But Rand said he sees Rhythm & Hues’ operations in India and new ties to an India-based company as a positive because of local projects available to Mumbai effects artists. He considers India-based artists working on Indian films to be a different case than the many Canada-based artists Hollywood studios hire for their films.

“They have Bollywood, their own film market, so [Indian VFX artists’ relationship with the U.S. film industry] can only be symbiotic – unlike some of the other countries that are simply paying Hollywood to have their work done there,” Rand said.

The Mill, a visual effects company headquartered in London with facilities also in the U.S., announced Thursday that it is closing its TV visual effects department. Mill TV’s credits include Doctor Who, Merlin, and Sherlock.

A statement released by the company explained, “Mill TV has suffered a number of setbacks such as failing to join the roster on Starz/BBC production of DaVinci’s Demons and the cancellation of Sky’s Sinbad sequel. Going forward, broadcasters are commissioning less high-end VFX driven drama series this year, with Merlin discontinued and the BBC not commissioning a Doctor Who series this year.”

Mill TV’s closure will come with the possible loss of 25 jobs, though the company hopes to find positions for those employees elsewhere at The Mill, said CEO Robin Shenfield in a statement.

Tippett Studio has scaled back its staff. The Berkeley, Calif.-based company has wrapped up work on Will Smith-starrer After Earth and has no big projects set for the immediate future, so the company made the decision to reduce its staff by about 50 people — 40 percent of its workforce. It’s a move that Head of Creative Marketing Corey Rosen told EW is typical for Tippett with its ebb and flow of projects contracted by production companies. Tippett is now the smallest it’s been since before it worked on 2009’s The Twilight Saga: New Moon.

“We’ve been telling everybody we were going to scale down when we finished After Earth. So that’s what we’re doing. We’re just doing the prudent thing and reducing the labor costs because we don’t have a big job right away,” CEO and president Jules Roman told EW. “Hopefully we’ll have them back soon, but we can’t be stupid and spend money we don’t have.”

For more on what’s going on with the VFX industry, read EW’s recent report here.

Follow Emily on Twitter: @EmilyNRome

Read more:
Oscars: Visual effects artists protest outside Dolby Theatre
‘The Avengers’: How ILM assembled the visual effects
How the creators of ‘Upside Down’ pulled off the look of dual gravity
Tupac’s hologram was made by Oscar-winning VFX artists, cost a lot, has a Twitter account

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