<p>Layoffs are dominating the animation landscape. The news of Technicolor India shutting down its operations in Bengaluru and Mumbai is a stark reminder of how quickly things change.</p>.<p>From working on such hits as <em>Mufasa: The Lion King,</em> which raked in over 120 million dollars just a few months ago, to now having to let go of 3,000 employees in Bengaluru alone, the unpredictability has put the industry on tenterhooks.</p>.<p>Technicolor, with its headquarters in Paris, says it has run into financial difficulties, and hasn’t found new investors.</p>.<p>A few key factors which have played a role in what we’re witnessing in the industry today:</p>.<p><strong>Generative AI</strong></p>.<p>Gen AI is on everyone’s mind, with the fear that it will make many roles redundant. Already, some blockbusters have used Gen AI. For example, ‘Avatar: The Way of Water’ used it to simulate movements and improve graphics. </p>.<p>About 60 per cent of business leaders feel Gen AI will consolidate jobs within their companies and replace some roles. If Gen AI replaces repeatable tasks or tasks at the lower end, what will happen in the future when companies need experienced people to lead? Will they be able to find good talent given that the bosses let go of it even before it got started?</p>.<p><strong>Biz autonomy</strong> </p>.<p>Most international studios set up units in India to capitalise on talent and labour but how much autonomy and business relevance do the units have?</p>.<p>In the case of Technicolor, the leadership in Bengaluru and Mumbai wasn’t aware of what was happening at the global headquarters. Strategies for specific markets, rather than a top-down approach, could have been the way to go. </p>.<p>Partnerships, either through acquisitions or mergers, are the latest trend. For instance, the Disney-Pixar partnership helped generate better technology, with Disney ultimately acquiring Pixar. The team rolled out such hits as ‘Ratatouille’, ‘Coco’, and ‘Inside Out’. However, when technology and talent are simultaneously in surplus, it could lead to job losses.</p>.<p>A good movie cannot be made overnight and requires a few years (‘The Simpsons Movie’ took about seven years). There was a time when great content was translated into blockbusters. But as customers switched to OTT, we see smaller projects being launched.</p>.<p>With some exceptions, smaller projects mean the quality of work is low. This becomes a double-edged sword. The audiences are often left unsatisfied and the studios do not make enough money.</p>.<p><strong>IP dimension</strong></p>.<p>Strong intellectual property (IP) can make a huge difference at the box office. ‘Spiderman’, with its IP rights, enabled multiple animated movies under the Spider-verse banner.</p>.<p>If we look at the Indian context, we do not have a strong IP tradition. Here, VFX is secondary, with star power taking precedence. Great movies go under the radar. When the focus is only on ROI, production companies with the potential for excellent work may be demotivated. Without strong intellectual property rights, competing on a global scale is hard.</p>.<p>It is estimated that about two lakh jobs will be impacted in the animation industry in the US alone. It is time for the studios to be agile and flexible and integrate technology while also offering their staff a chance to upskill and learn. </p>.<p>Animated movies tug at the heart of the viewers because of the emotions derived from stories, and created by the people behind the scenes. Looking at the current crisis from a cost-cutting point of view could be financially beneficial, but take away from what it really is to cater to the audiences. </p>.<p><em>(The author has worked in the animation industry)</em></p>
<p>Layoffs are dominating the animation landscape. The news of Technicolor India shutting down its operations in Bengaluru and Mumbai is a stark reminder of how quickly things change.</p>.<p>From working on such hits as <em>Mufasa: The Lion King,</em> which raked in over 120 million dollars just a few months ago, to now having to let go of 3,000 employees in Bengaluru alone, the unpredictability has put the industry on tenterhooks.</p>.<p>Technicolor, with its headquarters in Paris, says it has run into financial difficulties, and hasn’t found new investors.</p>.<p>A few key factors which have played a role in what we’re witnessing in the industry today:</p>.<p><strong>Generative AI</strong></p>.<p>Gen AI is on everyone’s mind, with the fear that it will make many roles redundant. Already, some blockbusters have used Gen AI. For example, ‘Avatar: The Way of Water’ used it to simulate movements and improve graphics. </p>.<p>About 60 per cent of business leaders feel Gen AI will consolidate jobs within their companies and replace some roles. If Gen AI replaces repeatable tasks or tasks at the lower end, what will happen in the future when companies need experienced people to lead? Will they be able to find good talent given that the bosses let go of it even before it got started?</p>.<p><strong>Biz autonomy</strong> </p>.<p>Most international studios set up units in India to capitalise on talent and labour but how much autonomy and business relevance do the units have?</p>.<p>In the case of Technicolor, the leadership in Bengaluru and Mumbai wasn’t aware of what was happening at the global headquarters. Strategies for specific markets, rather than a top-down approach, could have been the way to go. </p>.<p>Partnerships, either through acquisitions or mergers, are the latest trend. For instance, the Disney-Pixar partnership helped generate better technology, with Disney ultimately acquiring Pixar. The team rolled out such hits as ‘Ratatouille’, ‘Coco’, and ‘Inside Out’. However, when technology and talent are simultaneously in surplus, it could lead to job losses.</p>.<p>A good movie cannot be made overnight and requires a few years (‘The Simpsons Movie’ took about seven years). There was a time when great content was translated into blockbusters. But as customers switched to OTT, we see smaller projects being launched.</p>.<p>With some exceptions, smaller projects mean the quality of work is low. This becomes a double-edged sword. The audiences are often left unsatisfied and the studios do not make enough money.</p>.<p><strong>IP dimension</strong></p>.<p>Strong intellectual property (IP) can make a huge difference at the box office. ‘Spiderman’, with its IP rights, enabled multiple animated movies under the Spider-verse banner.</p>.<p>If we look at the Indian context, we do not have a strong IP tradition. Here, VFX is secondary, with star power taking precedence. Great movies go under the radar. When the focus is only on ROI, production companies with the potential for excellent work may be demotivated. Without strong intellectual property rights, competing on a global scale is hard.</p>.<p>It is estimated that about two lakh jobs will be impacted in the animation industry in the US alone. It is time for the studios to be agile and flexible and integrate technology while also offering their staff a chance to upskill and learn. </p>.<p>Animated movies tug at the heart of the viewers because of the emotions derived from stories, and created by the people behind the scenes. Looking at the current crisis from a cost-cutting point of view could be financially beneficial, but take away from what it really is to cater to the audiences. </p>.<p><em>(The author has worked in the animation industry)</em></p>