From the swift growth of AI, Metaverse and NFTs to the ever-evolving world of media and entertainment, the VFX, Virtual Production, Post-Production, and Animation industry continues to push the boundaries of what’s possible.
The VFX and gaming industries are buzzing with activity due to the integration of AI and gaming engines and the migration of post-production workflows to the cloud. Despite this, production companies and studios are facing numerous challenges and new obstacles in the process.
Below are several recurring pressure-points on the industry that Vitrina, as a global entertainment supply-chain specialist, is observing:
- Budgetary Constraints: Many projects have tight budgets and this is especially true in the case of post-pandemic Animation projects. The expected returns on these projects are definitely lower than the earlier estimates. A lot of our business users have used the Vitrina network to connect with specialist companies in cheaper and cost-effective locations. This has helped them achieve three vital goals:
- Expanding their choices
- Uncovering new specialists/specializations, and
- Outsourcing, offshoring to reduce costs
- Competition for Talent: The entertainment industry is highly competitive, and production companies are constantly upping the game to find and retain talent, writers, and other creative professionals. Vitrina is closely tracking different companies for their new services, specializations and capabilities through talent, tech, facilities upgradation and expansion.
- Limited Access to Financing: Securing financing for independent projects is challenging, as investors may be hesitant to fund projects that are perceived as risky or unproven. Whether the search is for project funding, production financing, or finding Co-Pro partners, Vitrina is always tracking the hottest dealmakers around the world, helping parties find the right partners with the exact credentials and make the connections between the parties.
- Changes in Business Models: Outsourcing, offshoring of animation and Post work; new deal structures for IP and content financing; cross-border co-production deals; traditional upstream studios moving downstream into streaming and vice-versa; P&L margin or cost pressures – all these are causing changes within the supply chain and business models are constantly evolving. Vitrina is closely monitoring, observing and recording new deals, partnerships, and alliances established between companies to get an understanding of new business models and deal structures that are preferred by the industry. This helps our users gain valuable insights and make more informed business decisions.
- Rapid Disruptive Technologies: Changes in VFX workflows and Virtual Production due to the emergence of gaming engines; use of AI-based automated tools for dubbing and localization; the migration of Post workflows onto cloud; the Ad-Tech choices for Freemium VoD and FAST-channel players are just some of the examples that are bringing new entrants or changing the erstwhile players. Vitrina’s approach here is quite dynamic – it is constantly updating its taxonomy with new services, technologies, methodologies, specializations and workflow refinements within specific supply-chain areas that are undergoing rapid transformations. This helps in severals ways:
- Staying up-to-date
- Improved accuracy in finding partners, ease of searchability
- Increase competitiveness
- Innovation by Competition: Intense competition is constantly causing companies to change their offerings by upgrading their talent, tech, facilities and unit-economics. Hence, the need on the Buyer-side to constantly review partners, vendors, suppliers.The noisy cacophony in industry journals, trade-shows, social media generated by companies and suppliers has become overwhelming! Vitrina is striving to decipher the significance of competitor moves, to comprehend the direction these companies are taking in terms of offerings, business models, and utilization of talent and technology, among other factors.
- Demand-Supply Mismatches: High demand is constraining the availability of the best vendors, service providers, and facilities, resulting in an urgent need for options and alternatives on the buyer’s end.Vitrina is helping Sourcing/Procurement groups, Production/Post Heads in diversifying their vendor and service provider options to ensure access to the best of specialist resources, even in times of high demand. On the other hand, we are working with service providers to ensure that their latest capabilities, technologies, services and offerings are showcased to prospective customers in real-time and exactly when those buyers are in their evaluation cycle.The global entertainment value chain is massive, fragmented, and very complex to navigate! Advancements in technology, shifts in the talent landscape, changes in business models, increased competition, and evolving global demands are driving VFX, Virtual Production, and Localization companies to be more dynamic and diverse than ever before.