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MillimeterYour Move
Jun 8, 2009 12:00 PM, By Michael Goldman
Post-recession strategies.
Company 3 was able to make certain recent upgrades to its theaters in Los Angeles and New York through capital expenditures that took place before the recession hit.
Making moves
Despite an overall slowdown in technology purchases, many facilities are strategically moving ahead with specific upgrades and other related projects right now. This is partly because capital expenditures for those projects were made before the economic bottom hit, but also because of their long-term, strategic alliances with high-profile manufacturers that periodically permit creative financing.
Even as some high-profile industry facilities such as The Orphanage and Pacific Title falter, others around Hollywood continue to grow their operations and appear to be busier than ever. For instance, Santa Monica’s Company 3, which is partly owned by Ascent Media Group, has DI theaters in both Los Angeles and New York—facilities that were expanded in the last year to accommodate such factors as stereoscopic 3D requirements. But as Stefan Sonnenfeld, president and managing director of Company 3, puts it, the financing of those new theaters “was based on how the economy was a year and a half ago—it is a tough time to be moving or rebuilding right now.”
That said, Sonnenfeld adds, the company’s whole approach is to run “lean and mean” in terms of amortizing its facilities and technology across all market segments and projects.
“We don’t have many multiple theaters, and we don’t do [DIs on] hundreds of movies a year,” Sonnenfeld says. “We do about 25 movies a year, and we do them well,” Sonnenfeld says. “But we made sure to sustain ourselves by limiting our size to be viable in good times and rough times going forward. That’s why we integrated and diversified our [DI suites] to do commercials, music videos, TV shows, feature films, and to do remastering—all in the same room. That is the only way to stay alive these days. This business has changed. Commercials and music videos have declined, while TV shows and movies have increased. You have to be designed to ebb and flow, and be agile and nimble and change direction quickly.”
Even busy facilities right now are anticipating a looming work decline, while projecting that projects will begin returning by early 2010, once the crisis eases.. Therefore, many are finding themselves making sure their infrastructures can handle current projects while being properly positioned for anticipated future work. Fortunately, the price of technology was falling even before the crisis and continues to do so, allowing some companies to make strategic upgrades even in the current environment.
“You need the tools to get the work done, or there is no point to it,” says Colin Green, founder of previsualization house Pixel Liberation Front (PLF) of Venice, Calif. “Fortunately, hardware and software prices are radically lower today than when our company started, and therefore, [upgrading] is not as strategic a decision for us as it used to be. Finding computers to render on is never out of reach anymore. The render farm that cost tens of millions [a few years ago] now costs tens of thousands.”
Still, many companies need to overhaul pipelines in order to accommodate new kinds of work they anticipate will be in demand once the crisis eases, such as 3D stereo¬scopic work, which industry types insist is here to stay. Many of them say that even in a difficult economy, post companies that wish to remain viable need to invest in stereoscopic technology now. Given this belief, some facilities are prioritizing precious funds for various kinds of 3D upgrades, including many DI color-grading suites being upgraded to do realtime, stereoscopic color grading.
Continue the discussion on “Crosstalk” the Millimeter Forum.
