Hollywood’s new reality amid special effects boom

Friday, May 12, 2006

By Merissa Marr and Kate Kelly, The Wall Street Journal

Growing up in the Chicago suburbs in the early 1990s, Greg and Colin
Strause were the ultimate computer geeks. While other teenagers played
sports or flirted with girls, the Strause brothers huddled over a
computer in their father’s basement creating movie-style special effects.

Now, thanks to Hollywood’s obsession with expensive computer-generated
tricks, the Strause brothers have hit the big time. Having worked on
“Titanic,” “The Day After Tomorrow” and this summer’s “X-Men: The Last
Stand,” the brothers can afford to live in luxury condos in Marina del
Rey, overlooking the ocean.

“We used to get flack for being nerds,” says Colin. “Now we’re nerds
with Ferraris and Bentleys.”

Spurred by box-office success, studios are lavishing unprecedented time
and money on whiz-bang effects. Their enthusiasm is creating a new
dynamic in moviemaking in which technology is replacing on-screen talent
as the biggest source of budget inflation. This summer’s films, which
are packed with digital extravaganzas, are helping set a new benchmark:
the $200 million movie.

But technology can’t always deliver the kind of efficiencies to
Hollywood that it generally provides to other industries. It has made
filmmaking not only more expensive and time-consuming but also more
difficult to manage. The people who create special effects consider
themselves artists and their agenda is to get it right — not make it
cheaper.

With so much money at stake, tensions have grown between studios, which
want to keep costs down, and special-effects houses, which are grappling
with escalating costs of hardware and talent. Meanwhile, some filmmakers
are finding it hard to resist the allure of technology, which can come
at the expense of storytelling.

“Visual effects add the arms and head to the Venus de Milo but should
never come up with the entire Venus de Milo,” says Scott Ross, founder
and chairman of Digital Domain, a leading digital-effects company, which
has worked on “Titanic” and “Charlie and the Chocolate Factory.”

Amid the excitement, studios are beginning to realize that relying on
special effects is financially risky. Such big-budget films tend to be
bonanzas or busts. If a movie hits the jackpot, it can create a
box-office juggernaut that mints money on video and television for years
to come. If not, it can burn a massive hole in a studio’s finances, as
Sony Corp. discovered last summer with its expensive aircraft thriller
“Stealth.” As effects budgets creep toward $100 million, studios are in
combat mode, playing vendors off one another to get the best deal.

Last winter’s “King Kong,” with its life-like depiction of a giant ape,
created a new standard in the effects world — and in Hollywood. At $207
million, it was the largest budget ever publicly acknowledged by a
studio (executives frequently downplay the true cost of their films).

Now similar numbers are popping up all over town. According to people
familiar with the movies, “X-Men,” from News Corp.’s Twentieth Century
Fox, arrives this month at $210 million, Walt Disney Co.’s “Pirates of
the Caribbean: Dead Man’s Chest” is fast approaching $225 million, and
“Superman Returns,” made by Time Warner Inc.’s Warner Bros., is likely
to weigh in at $261 million.

Topping them all is Sony’s “Spider-Man 3,” due for release next year,
which people close to the studio say will cost between $250 million and
$300 million. Some studios say their costs are eased by tax credits,
which could, for example, shave $20 million off the cost of “Superman
Returns.” For the same reason, Fox says the final tally for “X-Men” is
$165 million.

The price tags underscore that effects, not stars, sell big movies these
days. Of the top 10 U.S. all-time box-office hits, all but “The Passion
of the Christ” were visual-effects vehicles. Just one of last year’s
domestic top 10 — the slapstick romantic comedy “Wedding Crashers” —
had actors, rather than effects as its star.

To keep drawing people to theaters, studios feel pressure to keep
pushing computer-generated realism to new levels. In 1985, “Back to the
Future” featured more than 100 special-effects “shots” — short
sequences of about five seconds — depicting state-of-the art fantasies
such as a flying sports car and fading body parts. Two decades later,
movies can include 2,000-plus effects shots.

For “King Kong,” made by General Electric Co.’s Universal Pictures,
director Peter Jackson accumulated close to 3,500 effects shots, as he
navigated armies of dinosaurs and tinkered with the finer features of
the giant ape. According to executives at Mr. Jackson’s digital-effects
company, 500 shots were started and not finished and another 350 hit the
cutting-room floor.

Around the time of the film’s release in December, Universal publicly
pegged the tab at $207 million, after originally budgeting $175 million.
Two people involved with the movie say the final cost was closer to $250
million.

Many newcomers flooding into the business drew inspiration from moves
like the 1991 “Terminator 2.” Starring Arnold Schwarzenegger as a cyborg
from the future, it revolutionized the effects world with scenes
featuring T-1000, a robot warrior made of liquid metal that could
emulate both a human and inanimate objects.

Most of those effects were the brainchild of Industrial Light & Magic, a
company set up by director George Lucas in 1975 to handle the special
effects for his “Star Wars” movies. The granddaddy of the effects world,
ILM dominated for years with groundbreaking work on movies from “E.T.”
to “Jurassic Park” and “Mission: Impossible.”

ILM’s success spawned a wave of copycat houses, some set up by ambitious
ILM alumni, others by technically adventurous filmmakers. In 1993 Mr.
Jackson and a group of partners set up an effects house in New Zealand,
Weta Digital Ltd., which did most of the work for his “Lord of the
Rings” trilogy.

That same year another rival, Digital Domain, was created by ILM alumnus
Mr. Ross with James Cameron, the director and producer behind the
“Terminator” movies and the 1997 box-office buster “Titanic.”

In a sign of the conflicting interests of effects artists and
filmmakers, Mr. Ross and Mr. Cameron ended up falling out over the
shipwreck epic. Mr. Ross accused Mr. Cameron in published reports of
endlessly refining the movie’s effects to such a degree that the company
lost money on the project. Bert Fields, an attorney for Mr. Cameron,
says the director disputes Mr. Ross’s account and adds that Digital
Domain didn’t fulfill its contract. Mr. Cameron subsequently resigned
from Digital Domain’s board. Mr. Ross declines to comment on the dispute.

The Strause brothers got their big break as a result of that feud. In
1997, when Mr. Cameron was frantically casting around for extra artists
to work on “Titanic,” they were brought on board to create the ship’s
nemesis iceberg. Using a team of eight artists, the brothers spent three
months creating 12 shots, each lasting four seconds.

As teenagers in Waukegan, Ill., they got their start creating logos for
small local companies on a primitive 1980s computer. Their father later
bought a more powerful machine to help them win bigger accounts. It
worked, earning the boys $25,000 to create an animated eagle used in an
ad for a local gas station.

Greg, 31 years old, and Colin, 29, moved to Los Angeles in 1995 to work
on music videos and television shows. Four years after setting up their
company, Hydraulx, the Strause brothers now own multiple computer
workstations costing $300,000 each. New high-end monitors costing
$30,000 flicker through the dim light of their new studio in Santa
Monica, Calif. The brothers also built a $1 million screening room for
clients. Greg Strause estimates that computer maintenance alone costs
$300,000 a year. And that’s for a relatively small studio.

One of their most recent projects was “X-Men,” set for release May 26.
For flashback sequences, they took 25 years off the movie’s main actors
— including Sir Ian McKellen and Patrick Stewart — by smoothing out
their wrinkles and shaving pounds off their faces. A plastic surgeon
advised them during the process.

Despite their technological sophistication, visual effects are still
labor-intensive, requiring human artists and ever-more expensive
computer tools. To achieve realistic effects, each image requires
hundreds of hours of minute adjustments. Hardware is also wildly
expensive and computers need to be constantly upgraded.

For this summer’s $160 million disaster movie “Poseidon,” for instance,
ILM created a three-minute opening sequence of a cruise ship at sea that
was almost entirely computer-generated. ILM says it took a year. Each
shot in the sequence required 4,000 frames. Each frame took 25 hours to
make on the company’s most sophisticated computers.

On a recent morning, ILM animation director Hal Hickel tinkered with a
sample image of Davy Jones, villain of this summer’s “Pirates of the
Caribbean” sequel. Staring at an image of Davy with his octopus beard in
the screen’s top right, Mr. Hickel used his mouse to delicately shift
the character’s facial features. For Davy Jones’ upper lip alone, Mr.
Hickel’s computer has 24 commands for manipulating the sneer by minute
degrees. Every few seconds of animated footage took 10 days or more to
complete, he says.

“When you’re doing really realistic stuff, there are just so many little
details,” Mr. Hickel says.

The entirely digital character is based on actor, Bill Nighy, who was
filmed in a “motion capture” jumpsuit that recorded his movements so
they could later be manipulated by a computer. The character has a crab
claw, a pirate outfit and a beard of more than a dozen
independently-moving octopus tentacles. More than 500 artists worked on
“Pirates of the Caribbean.” Manpower is by far the most costly element
of the special-effects business.

“You have to make the audience believe it’s a real character,” says
Jerry Bruckheimer, the producer of many effects-laden movies, including
the “Pirates” series. “They can never see the edges or the workings of
the digital imagery.”

Today’s effects breakthroughs, however, are short-lived, one reason why
companies are constantly reaching for the next big thing.

“The amazing liquid metal effects in ‘Terminator 2’ were in tire
commercials within six months,” recalls Yair Landau, vice chairman of
Sony Pictures Entertainment, the studio behind the “Spider-Man” movies.
“A lot of imagery and technology gets assimilated into culture and you
have to raise the bar to give audiences a superior experience every time.”

With such firepower at their finger tips, filmmakers have to face a
question: When do they stop? In the past, filmmakers would often settle
for the first special-effects sequence created, so cumbersome was the
production process. Now, filmmakers have multiple options and spend many
nights holed up in editing suites perfecting sequences.

“In the old days, five to 10 iterations of one shot was normal, now it’s
not impossible to have 50 to 60 iterations for complex shots,” says Greg
Strause.

The simultaneous rise of cosmetic effects, which can fix anything from
an actor’s acne to bad lightning, has created even more opportunities
for tinkering in post-production. Filming with new digital cameras
creates a sharper, cleaner look, but one that shows up every blemish and
wrinkle. A filmmaker can add weeks of work and about $250,000 getting
rid of facial hair, a wig line, or bags under an actor’s eyes.

ILM says such late-stage, or “911,” work is common. ILM says it
frequently charges anywhere from $20 million to $80 million for work on
an effects-heavy movie.

Production crunches are common and effects houses often race to meet
tight deadlines — something that pushes costs even higher. For the
latest “Pirates of the Caribbean,” Disney has a tight window to finish
the elaborate effects; the studio expects to be working on the film
until close to its July 7 release, say people involved with the movie.

Sometimes, there isn’t enough time, forcing filmmakers to do things the
old-fashioned way. In a scene from “Harry Potter and the Goblet of
Fire,” in which the hero does battle with a dragon, ILM wasn’t satisfied
with the computer-generated fire, says Tim Alexander, a visual-effects
supervisor.

Rather than spending more long days fiddling with each spark, ILM hired
a flame-thrower that it filmed on stage. Then it superimposed the
footage onto the sequence. The tab for a day like that, ILM says:
$40,000 or $50,000.

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