Recession Strategies: Overseas View

The city of Dubai, United Arab Emirates, is about as far from Hollywood as you could imagine, and yet, in recent years, boutique animation and visual-effects facilities popped up in the region to service the booming advertising and real estate industries. That boom, however, has slowed, and as a result, some of those companies have gone away, and others are retrenching.

Related Links

Your Move Contrary to reports, Hollywood remains a busy place in this economic downturn—just a different kind of busy. Instead of deep production work, many companies are spending time jockeying for position in response to the recession and smaller waves of difficulty that are unique to the entertainment business... California''s Advocate In late May, Marty Keller, Governor Arnold Schwarzenegger''s small-business advocate, toured California to educate small-business people on what kind of resources the state government might offer them. During his trip, he hosted roundtable discussions with entertainment company officials to share information. ...

One of those is Blackstone Studios, a 2-year-old visual-effects and animation facility that launched to make design and promotional films for the real estate industry, but which is now in the midst of a transition.

"By the end of 2008, the real estate market slowed, and we started to feel the recession," says Ramez Hindi, executive producer and cofounder of Blackstone. "Dubai was booming in the real estate sector when we started, and every project required sophisticated marketing, which was a good business for us. But projects got put on hold or canceled in late 2008 as the real estate companies reacted to the global economy. When that change happened, we were already doing some commercial advertising work, but not focusing on it. Now, we are finding more work from advertising agencies because their clients are looking to adapt their marketing strategies for next year. A lot of big [advertising] clients are opting not to do full, big [live-action] productions, and are instead looking to split that money and do smaller animations that might get more frequency on the air. So we are now doing more animations and boards on the advertising front."

Still, Hindi says Blackstone is looking for other ways to diversify, and it has even recently started offering editing services. Hindi points out that Blackstone must also be extremely careful about managing its staff and infrastructure. In places such as Dubai, for instance, companies are not easily able to move staffing levels up and down for the simple reason that most of the artists they hire, including many specialized workers in Dubai, come from outside the region and relocate to Dubai.

"The staff is from all different parts of the world, and it is a lengthy process to find talent and relocate them here," he says. "Therefore, while we are not staffing up right now, we are trying to hold onto as many of the top people as we can. It would definitely be worthwhile to get more training programs going on in this part of the world, and then, maybe we wouldn't have to rely so heavily on external people."