Interview with Greg Smith, Director, Public Affairs

May 2009¹⁹³

Animal Logic¹⁹⁴ is a digital visual effects company that started working on commercials, has since diversified into animated feature films and is planning a move into digital games. The company produced Australia's first digitally animated feature film—Happy Feet—which was not only a box office success but won critical acclaim and even an Oscar. Animal Logic is currently working on Australia's second animated feature, Guardians of Ga-Hoole.

Animal Logic's path from advertising services to the global stage provides useful insights into attracting the right skills and investment to allow an Australian company to produce world-class content. It also demonstrates how high-speed broadband can facilitate business growth and more flexible working arrangements to the benefit of employees and industry.

From a start in advertising to an Oscar

Animal Logic started in 1991 and initially focused on providing digital visual effects services to advertising companies. Advertising work still forms part of Animal Logic's business today. But, in the 1990s, it became clear that the 'digital magic' that Animal Logic applied to commercials also had a role in visual effects in television and films.

In the mid-1990s, Animal Logic commenced digital visual effects work for films. The first movie the company worked on was with Paramount for the movie Face Off. The movie starred John Travolta, who play a United States Federal Bureau of Investigations agent, and Nicholas Cage, who plays a terrorist. Each character undergoes surgery to assume the face of the other.

The most recent animation Animal Logic worked on was Happy Feet, a computer-animated comedy-drama about a tap-dancing penguin that was directed and co-written by George Miller and produced in conjunction with Kennedy Miller, Warner Bros and Village Roadshow Pictures. As well as being the first Australian digitally animated feature film, Happy Feet won the Academy Award for Best Animated Feature and the British Academy Film Award for Best Animated Feature Film (BAFTA) as well as several other awards. In addition to the critical acclaim, the movie was a worldwide success and grossed more than US$300 million at the box office.

The studio is now developing its own stories and projects and building relationships with producers and creators. The plan is for Animal Logic to gradually expand from being a digital production studio, working primarily on a fee-for-service basis, to taking an idea to mass exploitation across different platforms. The company is also experimenting with digital games as another possible avenue for future production.

Skilling up

Attracting the best animation skills is critical for Animal Logic's success. From technical directors, to animators, to shaders, to riggers and render wranglers—the company requires skills in over 27 different disciplines.

Digital animation work is all about creativity and being on the cutting edge so much that it is almost the bleeding edge. Seventy per cent of Animal Logic's costs of doing business are labour related. Its key advantage is its human capital.

The challenge is hiring people who have the best and most current skills to work on digital visual effects. Animal Logic is working to grow animation direction capability locally. It has a strong training ethic. The company employs training staff and an extensive in-house curriculum. Animal Logic also runs an internship scheme and a work experience program for secondary students.

The company still needs to bring in people from overseas because there are not enough people with the necessary skills in Australia. Importing talent has many benefits because it makes the office a cultural melting pot and means that you know that you are working at the standard of the world's best practice. Animal Logic hires people from around the world—Canada, United States, Argentina, France, New Zealand, and Italy. There are over 27 different nationalities in the studio.

From a national and business point of view, however, there is a strong desire for home-grown talent. From a policy perspective, the challenge is that this world moves so fast that, by the time any training can be included in the curriculum and taught in a vocational or educational institution, it may be out-of-date.

The value of on-the-job training should not be underestimated. Many other professions have on-the-job training (for example, doctors must first complete a period as a registrar) or apprenticeships. Animal Logic tries to build on-the-job training into all of its positions and is then able to welcome graduates from institutions around the country.

Securing the necessary investments

For large budget movies, Australian companies generally need to take on an international partner for two main reasons. Firstly, the size of the budget necessary to fund such movies tends to be beyond the appetite of the Australian investor community. Secondly, to be successful, the movie needs access to a sophisticated, global distribution strategy and platform. Typically, overseas investment will come from companies based in Los Angeles, United States, which generate jobs in Australia and builds local know-how.

How broadband changes the game

The continued growth of broadband infrastructure complements and supports Animal Logic's business growth. In its ongoing advertising work, broadband capability allows commercials at a higher resolution and quality, which facilitates greater creativity and production values. When online advertising was primarily banner advertisements there was less scope, but with broadband, advertising can be the same or close to broadcast quality, which increases the creative potential.

Broadband is also important for developing digital games. The ability to carry richer data means that there is also greater potential to make games more interesting and grow this market.

With the rollout of high-speed broadband as part of the National Broadband Network, the ability to improve content production quality will only increase. Bandwidth requirements always grow to fill the available capacity. It can also give the company greater flexibility in how it manages its production facilities.

With high-speed broadband, Animal Logic's work could, for example, be carried out seamlessly by pods working in different locations. It makes sense for Animal Logic to maintain its base in Fox Studios because it is convenient for the director and others shooting a movie nearby to quickly drop by and see how the visual effects are developing. However, allowing people to work in other locations around Sydney can increase the talent pool because it gives people greater choices in terms of cost of living, and travel time. Locating teams away from the inner-city of Sydney can also reduce business costs.

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[193] Reuse or distribution of this case study must include the following attribution: Australia's Digital Economy: Future Directions © Animal Logic and Commonwealth of Australia, 2009, www.dbcde.gov.au/digital_economy/final_report

[194] See www.animallogic.com/