Smaller postproduction companies are proving to be nimble players in adjusting to the new normal, but some fear a downturn may be coming.
No sector of the film and television industry will be left unscathed by the coronavirus pandemic. The COVID-19 outbreak has shut down cinemas, canceled shoots and forced festivals online.
Even the postproduction business has been hit as studios have halted operations, leaving some of the biggest visual effects houses scrambling to find new ways to work remotely while still complying with the majors' strict security and nondisclosure agreements (NDAs).
But amid the maelstrom, some boutique postproduction companies are finding creative solutions to thrive in the new normal of lockouts and work-at-home orders. Several smaller VFX firms have actually seen an increase in business since the start of the crisis, as both studios and streamers push to get productions that wrapped shooting before the shutdown finished and out.
"We haven't lost any projects since the start of the crisis. In fact we've seen a 20 percent to 25 percent increase in overall business for our VFX and postproduction operations," says Matthew Helderman, whose Santa Monica-based postproduction house Buffalo 8 was set up as a fully remote facility from the start. Buffalo 8 has topped up work on productions such as Lionsgate's crime thriller Arkansas, starring Liam Hemsworth and Vince Vaughn, as well as Neil Marshall-helmed horror title The Reckoning, with bids on larger studio productions, which are farming out VFX work to meet the new demand.
"Productions that have wrapped are still keen to hit their delivery targets," notes Florian Gellinger of German VFX house Rise, currently in post on season three of Netflix drama Dark, Disney+ feature Artemis Fowl and the STX actioner Gunpowder Milkshake, starring Karen Gillan, Lena Headey and Angela Bassett. "Some of the bigger productions are covering their bets by putting out work to multiple smaller VFX houses at once."
Gellinger said Rise has actually turned down new work to ensure it doesn't overextend itself during the crisis. "We're not bidding on anything right now that's complicated and requires a quick turnaround," he says. "Because we can't just fly in freelancers from Spain or Italy like we can normally. We are currently working at 50 percent to 70 percent of our full capacity, keeping something in reserve. We don't want to be in a position where we can't deliver."
While Gellinger says the company had "zero technical problems" shifting to a remote operation, he admits security was an initial concern. "We're not letting anything off our main, secure server. Everyone is logging in remotely to that," he says. Rise's studio clients were understandably concerned about details of their projects leaking or being hacked, but Gellinger says the company was able to adjust its security measures and update its vendor NDAs to satisfy them. "A lot of the stuff was basic: like extending NDAs for employees working at home to all members of a household or banning a remote worker from having their computer in front of a ground-floor window," he says.
But while Rise and other VFX companies are showing they can work remotely, few prefer it.
"Working remotely is never ideal. You can't beat having a VFX supervisor 10 yards away where you can walk over to discuss a shot," says Peter Hampden, head of London-based Lipsync Post.
"It is far less efficient than having everyone in one room and the supervisor can just walk by and check everyone's work," adds Gellinger. "The endless video calls have been a nightmare."
And, Hampden says, there are still aspects of the postproduction process that need to be done in person.
"Sound-mixing has be in a sound studio, and color-grading has to be judged in a theater on the big screen," he says. "We're just keeping people involved to a minimum, so the director and maybe one other person in the room with the technician, with social distancing, hand sanitizers and the rest."
While business right now is good, Hampden worries about a downturn in a few months, after the crisis.
"Typically, right now we'd be picking up projects that would be shooting in spring and summer for us to take us through the autumn, but those projects aren't being shot, because everything is shut down," he says. "In four to five months' time, we are going to see a big drop in business."
Hampden notes that government plans aimed at helping companies hit by COVID-19, such as the recently unveiled furlough scheme in the U.K., are likely to wrap up before the crisis hits postproduction. Local lobby group UK Screen Alliance is pushing to have such programs extended beyond the current lockdown.
Helderman of Buffalo 8 is more optimistic the production industry will quickly bounce back. "People are using this enforced downtime to fast-track development because we are seeing an increase in demand for content," he says. "Once shooting is allowed to start up again, the industry is going to see a production boom."
If that does occur, the riches won't be shared evenly. Hardest hit could be post houses heavily reliant on quick-turnaround commercial work. As the global economy slumps, most are forecasting a deep recession in the advertising industry. The impact is likely to be different from sector to sector and territory to territory.
"Companies that have a diverse range of projects — both film and television and both local and international — are probably going to be best equipped," says Ulrich Schwarz, head of production at Rise's production arm, Rise Pictures. Rise Pictures has put together co-financing and co-production for such upcoming projects as Matthew Vaughn's The King's Man and Stowaway from Arctic director Joe Penna.
The company was the first to use a new state-backed financing model to secure subsidy financing for VFX production — fully 45 percent of the VFX budget for The King's Man came from German federal and state sources.
"What's certain is that the crisis is going to radically change how we do international productions. Flexibility in everything — financing, shooting and postproduction — will become key," says Schwarz. "A second-unit team live-streaming their shoot to the director who can make adjustments in real time, a director sitting in Los Angeles doing post with a VFX artist in Berlin, all stuff that is possible and is happening in a small way already, will become more common and more necessary."
