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Digital Cinema

Through the Moebius Strip

The sun has long since set over the South China Sea, and 250 artists are still hunched over their desks adjusting the motion of giants and spaceships in Maya. We're in Shenzhen, the world's fastest growing city and home to the Institute of Digital Media Technology (IDMT), China's largest animation school and studio. The artists are working on China's first CGI feature Through the Moebius Strip (see “The Six-Million Dollar Indie,” January 2001 and “Next Generation Digital Studio,” February 2003) and most of them are former students at IDMT. While there is tremendous pressure to complete the project in time for Cannes, there is a larger mission to consider. Everyone understands that what's happening here is a gamble to establish China as a major production center for animation.

As participants in IDMT's unique studio concept, students live, train, and work in an 80,000-square-foot facility bordering the palm tree-lined campus of Shenzhen University. The living space is combination Motel 6 and dorm where artists have access to their computers 24 hours a day.

Most of the artists are in their 20s, but there are also married couples, such as senior art director Chen Ming and his wife, Zhang Chi. They have been living at IDMT for more than three years. This may explain the absence of the boisterous, open-door, dormitory atmosphere you might expect and would surely find if IDMT were located in Los Angeles or New York. While the living arrangement may seem like a license to overwork young animators, the studio seems no more frenetic than Digital Domain or Sony Imageworks. However, a walk through the animation bays will find some artists tapping their keyboards long after midnight.

Students pay IDMT $1500 USD a year to learn Maya, compositing, and other aspects of digital production. If they excel, they may be hired to work at the studio one floor below the classrooms. The facilities at IDMT are modern and spacious: Students and working animators have tricked-out Dell dual-processor workstations and lots of desk space. In a country with high unemployment and a small middle class, IDMT and the growing animation industry are great opportunities.

(From top) Digital animators at Global Digital Creations studio; a dimensional model created in GDC's model shop; Shenzhen, China, near the GDC studio; preliminary artwork from Through the Moebius Strip; Still from Through the Moebius Strip.

The country's eager labor force, of course, is why China is the last great frontier of entrepreneurship and market exploitation. After seven consecutive years of growth, capitalism is taking hold in China, and expectations are that when it kicks into high gear, investors, governments, and some individuals are going to become rich.

Global Digital Creations (GDC), the technology company behind IDMT, is using the history of outsourcing cel animation ink and paint as a road map for its own plans for the domination of the animation industry. That history recounts the inevitable triumph of cheap labor that caused the demise of inhouse ink and paint at animation studios in the United States. In the 1970s, Mexico, Korea, Japan, and China could perform cel painting chores more cheaply than stateside talent, and it only took a decade for most Hollywood ink and paint departments to close their doors.

As the Asian talent matured, in-betweening was added to the list of skills that American animation studios trusted to overseas service bureaus, eliminating the majority of skilled animation jobs in the United States. Today, history repeats itself: Korea and Japan, no longer the least expensive locations, are finding it cost-effective to outsource some of their own animation finishing work to China.

This same model, GDC reasons, could be the evolution of CGI — a similarly labor-intensive business. However, U.S. studios' pursuit of cheap labor evolved over more than a decade. A generation of foreign animators was trained to work on images in a language they did not understand and with cultural references outside their experience. This proved to be a problem, as work had to be redone and additional training required in order to deliver acceptable results.

The immediate cost savings were not realized on fixed bids, and the new service bureaus had to absorb the cost of the overruns. For this reason, several of the pioneering work-for-hire studios in Asia did not survive the early years. That's why IDMT devised a comprehensive approach to training animators for use in its own studio. This control over the human factor is capitalism married to the tradition of cultural control that has been engendered in China's population under socialism since the 1950s. It seems to be working.

The architects behind IDMT's animation initiative and digital cinema strategies are Raymond Neoh, CEO of GDC, and his brother, attorney Anthony Neoh, chairman of GDC Holdings. Raymond Neoh is the executive producer of Through the Moebius Strip and has something of the mad scientist about him. He is full of ideas and seems to be several steps ahead of his staff, which scrambles to implement his concepts or just get them down on paper. It was Raymond Neoh's idea to accelerate the growth of the 3D animation talent pool in China and to take advantage of the 8 to 1 economic advantage on the mainland.

Here are the facts that the Neoh brothers and GDC considered: A film animated in the United States, for example, Shrek or Finding Nemo, costs approximately $50 to $60 million to produce. A less sophisticated CGI movie like Jimmy Neutron costs less than half that. Animation artists in the United States get paid an average of $125,000 per year. An animated film requires approximately 150 artists to complete a feature. At the average pay rate, that's about $22 million a year. If it takes two years to complete a picture, that brings the cost to the $44 million mark. These are just estimates, but it's easy to see how a budget quickly balloons to the $60 million or higher mark with above-the-line costs added and a longer schedule.

Students at the Institute of Digital Media Technology (IDMT) study digital production (above) and relax (below) in the 80,000-square-foot facility near Shenzhen University. Students have access to workstations 24 hours a day.

In China, digital artists are paid $25 to $60 per day. Forget workman's comp and payroll taxes. Some higher-priced talent — usually from the West — has to be factored into a budget, but the overall gains are obvious. In China it's possible to make a 3D animated feature for less than $10 million. That number is likely to fall as the labor rate stays constant while Chinese animation studios become more experienced and eventually less reliant on costly Western expertise.

GDC management wants to use these advantages to make original animated films in the manner of Pixar or Blue Sky, but based on Chinese cultural heritage. Ironically, GDC's first production, Through the Moebius Strip, is based on a French comic book directed by an American with a script by the author of Disney's Ferngully. Still, it's an original production entirely funded by GDC; not work-for-hire. Whereas the low cost of production is a huge advantage for Chinese animation studios, there are reasons why developing original properties may be difficult.

For one thing, China is still a socialist state. The liberalization of markets and China's closed culture will certainly continue, however, the government is caught between two conflicting goals: preserving Chinese culture and traditions while creating open markets.

For the Chinese government, this means trying to encourage indigenous filmmaking while allowing the importation of foreign films (read that as Hollywood). These films are cross-promoted with all the other U.S. products that are necessary for China to succeed as a trading partner. Foreign investment comes at a price. In every country where Hollywood has successfully challenged local film quotas, regional filmmaking has diminished, often significantly. World cinema is becoming homogenized in the cineplexes, despite the fact that digital technology has made filmmaking more accessible. This trend is not lost on the Chinese government.

Another issue is that China has never had an original tradition in animation and has from the beginning been imitative of Hollywood. As early as 1923, the four Wan brothers were inspired by the work of the Fleischer brothers. Later animators followed the Disney model, and later still the work of European animators. There have been individual Chinese animators who draw on traditional Chinese art and literature in their work, but no school or trend as sustained as Japanese Manga or Anime has emerged in China.

(Above) The GDC studio is located one floor below the classrooms in the IDMT building (below).

At the most basic level, the question is the audience. For whom does China make films? Currently, the only audience large enough to support big budget animated movies, even at China's cut rates, is the United States — the world market now essentially consists of a Western audience. That's the dilemma facing indigenous filmmakers around the world. In China, however, the potential audience is several times larger than that of the United States. This would seem to be the answer to China's problem, except for one thing: Movie attendance in China has been in decline for decades. Twenty years ago, the Chinese box office was about 30 billion Yuan a year (Xinhua News Agency, Aug. 25, 2002). Today the number is closer to 800 millon Yuan.

To grow audience attendance back to its former peak, the Chinese need foreign investment and Hollywood product, but that will only help inculcate a taste for Western film, not a local Chinese tradition. Since joining the World Trade Organization in 2001, the Chinese government has loosened its quota on Hollywood product, but apart from protecting markets, there are also objections to the amount of violence and sex in many of Hollywood's movies. Because of its focus on a younger audience, animation is more acceptable to the government, but the trend toward homogenization is unavoidable.

In the short term, GDC and other animation studios that will follow in its footsteps are going to be successful by providing cheap labor and creative talent for Western projects and co-productions. The runaway production bills favored by film trade unions and production companies in the United States — largely aimed at Canada — will have a much bigger competitor to target.

The first test of Chinese digital production will come when Through the Moebius Strip reaches audiences this year. If Hollywood sees potential, it will soon be knocking on GDC's door and considering the risk of using an rookie animators vs. potential savings.

Beyond that, what is a cost-saving decision for Hollywood is a creative opportunity for independent animation producers. As long as China remains unproven ground for risk-adverse Hollywood, projects outside the mainstream have a place to go at a price Hollywood will take seriously. No one will make a groundbreaking animated movie for $25 million, which is low by Hollywood standards. But $10 million or less for an indie-animated film will certainly get you meetings in Los Angeles. That budget is at the threshold where Hollywood might take a gamble.

The fact that a shrewdly designed story and visual treatment could actually be made in 3D for $5 or $6 million might open up this incredible technology to artists with an original vision. GDC thinks so, and it's counting on those dreamers to help the studio make its mark in animation.


Sidebar

Digital Cinema


China is second to the United States in the deployment of digital cinema, but it may surpass the United States in the next few years. Before liberalization policies and its entry into the World Trade Organization, China's 20-year decline in movie attendance did little to inspire the Chinese government to renovate theaters or build new ones. In comparison, the United States saw unprecedented renovation and building of new theater complexes in the 1990s, before digital cinema. China has every reason to overhaul its deteriorated exhibition infrastructure, whereas the United States will be faced with the choice of replacing equipment that is relatively new. In the United States the decision to move forward with what is essentially a nationwide change in infrastructure requires the cooperation of seven studios, distributors, and exhibitors who never got along very well in the first place. In China, the government will determine, or guide, the rollout of digital cinemas. This will be done through state-owned or state-sponsored entities, like the Chinese Film Company, China's biggest film production and distribution organization. The Chinese Film Company has already announced plans to outfit or build 200 digital cinemas in the next few years.

Given GDC's comprehensive approach to training and studio management at the Institute of Digital Media Technology, it's not surprising that GDC is at the forefront of digital cinema, a move that completes the production chain from creator to viewer. GDC Technology was founded by Dr. Man-Nang Chong, a pioneer in digital postproduction and distribution, and also the inventor of the Revival Digital film processing system, sold through Da Vinci. GDC is marketing an end-to-end digital delivery system based on GDC Technology's proprietary DSR Server and Digital Film Agile Encoder. GDC is jockeying for position with U.S. companies, but has the advantage of being the only digital cinema technology company in China.


Sidebar

Through the Moebius Strip


Jean Moebius Giraud has been drawing and writing comic books for more than 30 years. His style fluidly combines high-tech space ships with medieval worlds — the Age of Bronze meets the Age of Silicon with a New Age overlay. But before he entered the fantasy realm, Giraud scored his first popular success with Blueberry, a story of the Old West during the Civil War. The live action version of Blueberry stars Vincent Cassel and Juliette Lewis and opens in 2004.

With Through the Moebius Strip about to debut at Cannes, this may seem like the year that movie audiences discover Moebius, but we've actually been seeing his work for years. His artwork and designs inspired aspects of Star Wars and he's credited as a production designer for The Fifth Element, Time Master, and the story for Winsor McCay's Little Nemo: Adventures in Slumberland.