This category includes establishments primarily engaged in performing services independent of motion picture production, but allied thereto. These include motion picture film processing, editing and titling, casting, wardrobe and studio property rental, motion picture and video tape reproduction, and stock footage film libraries.
512191 (Teleproduction and Other Post-Production Services)
561310 (Employment Placement Agencies)
532220 (Formal Wear and Costumes Rental)
532490 (Other Commercial and Industrial Machinery and Equipment Rental and Leasing)
541214 (Payroll Services)
711510 (Independent Artists, Writers, and Performers)
334612 (Prerecorded Compact Disc (Except Software), Tape, and Record Manufacturing)
512199 (Other Motion Picture and Video Industries)
This highly fragmented industry covers a range of services and products geared toward the production of motion pictures. Usually, firms engaged in this sector focus mainly or exclusively on a specialized operation and generally contract their services to motion picture producers or distributors. As small, relatively unleveraged firms, these hired guns are often forced to compete with each other on pricing in order to attract major Hollywood studios as well as independent filmmakers, who typically work with a tight budget.
By the late 1990s, major studios, such as Disney and Twentieth Century Fox were investing in large facilities to house equipment for post-production activities such as editing and sound mixing that can be accomplished on site. Some, like Twentieth Century Fox, boast complete ground-up digital integration, bypassing the need for analog sound conversion. Others include wardrobe and scenery stocks and tape reproduction facilities; thus, the firms engaged in services allied to motion picture production were scrambling to maintain their viability in this increasingly consolidated marketplace, often positioning themselves as an attractive purchase for major studios.
The hottest sector of the industry in the late 1990s was the production of special effects and animation. The astounding success and proliferation of films and movies featuring computer-generated special effects led to a rapid expansion and enhancement of these technologies. Film studios were engaged in competition to dazzle audiences with the most amazing visual images. By the end of the 1990s, 16 of the 20 largest all-time box-office hits had sold themselves primarily on special effects.
The overall structure of the services allied to motion picture industry is distinguished by a heavy reliance on subcontracting and freelance talent. Firms rarely enjoy movie-gross percentages and remain fixed on jumping from one short-term contract to another. As a result, these companies are usually in a poor bargaining position with studios, a feature that is exacerbated by the highly fragmented nature of the industry. They are continually forced to monitor the contracts competitors enter into in an effort to out-price them and attract studios.
The key players in the industry—directors and producers—develop strong relational networks based on previous successes and reputations. The production team, which is composed of primary and allied production services, brings together a diverse group of professionals, services, and capital equipment. These relationships are temporary, created for the single purpose of producing a particular film. However, such temporary organizations are reassembled with the production of each new film; a service provider's reputation is a paramount factor in his/her ability to facilitate membership in the new network.
Motion picture production is a highly complex business that involves an interplay of commercial and creative considerations. There are a number of interrelated activities that may be broken down into four phases: development, pre-production, production, and post-production.
Development. The development stage involves acquiring literary rights, writing and developing a screenplay, and hiring key creative personnel such as the director and the cast. Key allied services during the development stage include those offered by literary agents and talent and casting services.
Literary agents represent writers and directors. Agents negotiate for their clients and review scripts. They make determinations regarding what projects constitute good film property and then convince producers and actors to take on these projects. Most literary agents are involved in the development of potential deals, concept development, and the provision of creative and practical advice on translating a script into a motion picture.
Casting for a motion picture is usually the result of interaction between the casting director and casting consultants or services. The casting director is responsible for casting roles and maintaining an ongoing relationship with talent and casting consultants. Casting consultants are hired on an individual-project basis. They function as an actor clearinghouse for the director. Casting consultants seek out and hire actors, negotiate salary and billing issues with the actors' agents, prepare contracts for all actors, and make "first work" calls. In the late 1990s, the key player in the casting service business was the Casting Society of America. Most other major casting service firms were located in and around the Los Angeles/Hollywood area.
Pre-production. During pre-production, the remaining creative personnel are hired, a budget is developed, shooting schedules and locations are planned, and other necessary steps are taken to prepare the motion picture for primary photography. Key allied services during the pre-production stage include studio and production facility rental services.
The most prominent studio facilities are the mainstream producers of large-scale release motion pictures. These include Twentieth Century Fox, Warner Brothers, Columbia/Tri-Star, Universal Studios, Paramount, Disney/Buena Vista, Sony, New Line, Miramax, and MGM. However, the industry is really a continuum ranging from mainstream studies to true independent producers. The mainstream studios control nearly 90 percent of the revenue in theatrical rentals but are responsible for only 42 percent of the production starts. There are many small productions, then, that utilize small, independent production facilities; this is especially true of productions filmed outside of the Los Angeles/Hollywood area.
Production. This phase of motion picture development includes the actual filming. Key allied services include animation, camera-equipment rental and operation, costume design and rental, lighting equipment rental and operation, and property and scenery design, rental, and maintenance.
It is during the production stage that the division between equipment rental/provision and operation is manifested. Equipment provision services are conducted by a number of independent firms; equipment operation, on the other hand, is conducted by union employees. The most prominent entertainment unions in this area is the International Alliance of Theatrical Stage Employees (IATSE) and Moving Picture Machine Operators of the United States and Canada.
Animation is the process of exposing film by individual frames while introducing a slight change in the photo-graphed object or drawing following each exposure. By linking hundreds or thousands of frames, the materials become animated, moving in accordance with the intention of the individual creating the film. Other animated files are created by single frame exposures of models or objects. Film special effects are increasingly dominated by digital animation. Technological advances have allowed lower production costs in animation, allowing increased use of animation in motion picture openings, commercials, and special effect simulations. Animation and special effects are dominated by a small number of firms, unlike most sectors of this industry. This sector generates estimated revenues of $600 million each year, a figure that has more than doubled since 1993, as more movies incorporate or feature animation and special effects. Prominent players include George Lucas' Industrial Light & Magic, James Cameron's Digital Domain, Sony Corp.'s Imageworks, Hanna Barbera, Rankin/Bass Productions, and Walt Disney Studios.
Camera equipment and personnel are an important aspect of motion picture production support. Such elements include the actual photographic device for shooting film; camera-hauling vehicles; the director of cinema-tography and associated camera crew; and individuals responsible for lighting, setting up, and composing shots. Although camera supply houses do not provide operators, they usually offer ancillary services such as equipment repair.
Costume design is a vital part of the film production process. Costume rental firms exist in virtually every major city, due to demand not only from motion picture production, but local theater and private costume rental.
Lighting equipment rental and operation is another important service. Although setting the position of lights on the set is the responsibility of the director of photography (cinematographer), the cumbersome nature of film lighting equipment makes actual implementation both difficult and time consuming. There are more than 100 lighting equipment firms in both Los Angeles/Hollywood and New York. Lighting technicians, repairmen, and lighting operators all fall under this category.
Property and scenery design, rental, and maintenance is an important production element as well. Property (or "props") includes any moveable item seen or used on a motion picture set. Scenery includes any background or backdrop used in a studio. There are several key professionals engaged in prop design and maintenance. A "prop maker" is frequently a member of the construction department (usually a carpenter) who is responsible for making the necessary props. A prop master is responsible for maintenance, availability, and placement of props on the actual set. Scenic artists are responsible for production of all illustrations, scenery and set designs, scale models, props and other set dressings. More than 90 percent of property and scenery rental firms make their homes in the Los Angeles and New York areas.
Post-production. In post-production, the picture is edited into its final form; music, dialogue, and sound effects are synchronized with the picture, and special effects are completed, resulting in the negative from which release prints are produced for distribution. Key allied services include computer colorization, cutting rooms, editing equipment and services, film processing and preservation, music libraries and cutting services, sound and recording services, special effect services, subtitle services, and trailers.
Editing equipment and services are essential to the post-production process. Editing involves joining together the various pieces of film shot by the cinematographer into a single, cohesive, and dramatic whole. The autonomy experienced by the editor depends on the director. For some films, the editor and director will work closely in selecting each shot and determining where to cut, splice, and edit. Accordingly, some directors shoot a large quantity of footage, allowing the editor a great deal of choice; other directors shoot less footage, providing the editor with less autonomy.
As is common in this fragmented industry, editing equipment, editing services, and editing personnel are provided by three different groups of organizations. There are more than fifty editing equipment firms, the majority of which are located in Los Angeles and New York. More than 100 firms, represented equally between New York and Los Angeles, provide film editing services.
Other major post-production services include: (1) Cutting rooms—specially designed facilities equipped with editing equipment where the editor and assistants can put the final film together. (2) Film processing and preservation—the actual development of the film into a negative and subsequent processing, copying, and preservation. Technicolor was an industry leader for this service. (3) Music libraries and cutting services; sound and recording services—these services include the process of recording sound during production and subsequently editing and adding sound to the final product. Some producers use stock music by anonymous composers to develop a sound track, while others utilize commissioned musicians. Again, this segment of the industry is highly fragmented, with more than 100 firms engaged in music cutting and music libraries and more than 100 firms that provide sound and recording services. Sound technicians include: production mixers who are responsible for sound equipment and recording on set; boom operators who operate the microphones to pick up actor's dialogue; re-recording mixers engaged in combining sound in the studio; and sound effects mixers, responsible for sound effects both on the set and in the studio. (4) Special effect services—special effects include a wide variety of creative photo-graphic and sound effects. There are more than 50 special effects firms, which operate primarily in Los Angeles and New York, but also in such locations as Las Vegas, San Francisco, and Orlando. Prominent firms include Buena Vista Visual Effects Group in Burbank, California; Lucas-film, Ltd., in San Francisco; and Walt Disney/MGM Studios in Orlando. (5) Subtitle services—subtitles refer to titles that appear at the bottom of the screen of foreign language films or to narrative titles in silent films.
Firms engaged in services allied to motion picture production are intimately tied to the success of the film industry as a whole and, as such, keep a close eye on box office receipts. The late 1990s did not disappoint. Box office receipts finally emerged from their stubborn mid 1990s stagnation, increasing from $5.9 billion in 1996 to $7.0 billion in 1999. Foreign sales showed an even faster growth in the last 1990s, rising more than 10 percent annually between 1996 and 1999.
As major studios attempt to streamline their production operations and limit costs, they increasingly integrated operations covered by this industry into their organizations. Firms specializing in the various sectors of services allied to motion picture production were purchased by large film and telecommunication firms, such as when AT&T's Liberty Media Corp. purchased the California-based Four Media Co. in 1999. The effects company Digital Domain was likewise purchased by chip-manufacturer Intel. Such moves were indicative of the overall trend toward integration of high-level technological platforms for use in both entertainment and communications.
There was tremendous concern in the late 1990s in the film industry over the loss of jobs to runaway production, in which film producers take production to Canada and other foreign countries, largely to capitalize on the favorable exchange rates that make production in those countries significantly cheaper. In 1998, U.S. film and TV production conducted out of the country cost the U.S. economy $10 billion, an increase of 500 percent since 1990, according to the Screen Actors Guild and Directors Guild. Legislators in California and other states, and at the federal level, responded by introducing bills that offered tax breaks to production that was conducted in the U.S. Despite the growth of runaway production, however, over the same period employment in California's film industry nearly doubled.
For consumers, Hollywood's budget problems meant more sequels and increasingly formulaic films. For businesses involved in providing support to motion picture production, it meant a shrinking market in which relationships with studios were a top priority.
A relatively recent technological advance in the film industry has been the colorization of old films. Colorization is the process by which black-and-white films are transformed into color. The process involves breaking down each frame into 525,000 dots. An art director examines the first and last frame of each scene and programs the colors for each object. There are two primary firms engaged in colorization, American Film Technologies and Color Systems Technology, both of which are located in the Los Angeles area.
Undoubtedly, the most significant technological developments in the film industry in the 1990s occurred in the special effects sector, where computer-generated images quickly became a staple of Hollywood films, thrusting firms like George Lucas's Industrial Light and Magic and James Cameron's Digital Domain into the national spotlight. Increasingly, the level of special effects assumed a primary selling characteristic for blockbuster films, such as Titanic, which featured a special effects budget of $40 million.
Though computer-generated images have been making tentative forays into films since 1984's Tron, manipulating images this way requires vast amounts of memory due to film's superior picture quality. Since the powerful technology needed for this process was too expensive, few movies made in the 1980s used computer-generated images. By the late 1990s, however, cheap, powerful workstations and a wide range of versatile graphics software made computer graphics a viable alternative to the models traditionally used for special effects. The widespread transfer of high-end digital production to computer platforms, which offer tremendous cost benefits, especially in computer animation, afforded allowed major studios to invest more heavily in attracting the top graphic artists and less on expensive equipment. Moreover, small, independent filmmakers were able to process high-level special effects in-house.
The film industry also made aggressive moves toward the use of digital cinema as a replacement for film, a move that has been discussed in the industry for several years. Digital cinema is likely to be incorporated into use with DVD-ROM, a physical distribution that, in the meantime, seems more attractive than satellite and cable due to the increased delivery control afforded by the physical format.
In a development not likely to prove popular among actors, industry observers noted that digital technology had reached a point where just around the corner waited the implementation of virtual actors into major motion pictures, one of the primary foci of the digital animation industry. By combining scores of photographs in a data memory bank, graphic artists can shape features and movements tailored to the needs of the director. While the technology has yet to reach a stage in which the actors appear truly real, analysts note that it is simply a matter of time. Such moves take selective casting of actors to the next level, by literally creating actors from the ground up, allowing directors to get the precise features and capabilities they desire. Such actors could pull off physical stunts beyond the capacities of live stunt actors—without necessitating elaborate set designs.
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