By CHICKIE R. LOCSIN
‘THE Philippines has the best talent in the world, but its animation industry is among the smallest in the world.”
Coming from an Australian, Wayne Dearing, chief executive officer of Top Draw Animation, the statement is both a tribute and a challenge.
Miguel del Rosario, of Toon City Animation and vice-president of the industry organization, Animation Council of the Philippines (ACPI), pinpoints on the need for creativity to be complemented with business acumen.
Top Draw and Toon City are the biggest players in the animation industry in the Philippines and employ 400-500 full-time professionals working on multiple projects with contracts until 2018.
Toon City’s clients include Walt Disney Television Animation, Universal Animation, Warner Bros. Animation, MoonScoop Productions.
Among their popular productions are Angry Birds Toons and Voltron.
Top Draw’s credits , on the other hand, include My Little Pony, Transformers and Monster High.
A couple more Philippine studios have sizeable portfolios but the rest are in the doldrums, missing out on opportunities offered by the global animation industry, conservatively estimated to be US$240 Billion.
Del Rosario, who has the unenviable task of building up the animation industry in the country said one of the industry problems is government support. “While Canada, France, Australia, Malaysia, India and other animation capitals enjoy some form of subsidy, our animation studios can barely afford the US$2500 cost of 3D licenses. Without it, they are not compliant with a basic requirement of the global clients. “
Consequently, some small studios have resorted to accepting unregistered sub-contracts employing free lance artists and underpricing the bigger studios. Unfortunately this informal business arrangement does not provide enough margin to build up an organizational infrastructure that would assure clients that the studio will be around for the long term.
“This vicious cycle keeps the studios at the periphery of the industry, widening the gap between the market leaders and the mom-and-pop operations,” laments Del Rosario.
Dearing debunks the notion that capital is the critical factor to get started or to grow. “Clients give payments upfront to start the project and there is cash flow from progress payments.”
Both Dearing and Del Rosario agree that the critical factor to success is a knowledgeable business manager, rather than a veteran artist or a member of the academe, to manage the business.
Del Rosario notes “Local studios must strike a balance between a creative mind and management expertise.”
Dearing, an accountant by profession but with a marketing orientation, sees the need to think long term and not just on a project basis. Pricing must be competitive but more importantly the product must meet client’s stringent quality standards.
In his case, in lieu of government subsidy, he co-produces with his partners taking up 10 percent of their production budget. He plows back another 20 percent into the business, investing heavily on technology and support services.
To bring the company to the next level, Top Draw invests P3 milion to P4 million a year in leadership programs for its department heads. On a
smaller scale, Toon City conducts a curriculum-based training program with Scott Peterson from California. A batch of twenty students at a time have classes via Skype using actual materials from their clients and supervised by their in-house directors.
Dearing stresses the importance of networking: “There is no business to be generated unless the art studios visit the market place where contracts are generated.”
Dearing and Del Rosario regularly attend industry meetings held annually in Cannes and Florida to network with global clients and producers. Small studio owners cannot afford to attend these international conferences.
Del Rosario is pitching for the Asian Animation Summit to be held in Manila in December 2015. This is a major industry event that has been hosted in the last four years by Korea, Malaysia, Singapore and Thailand. The forum will give local studios a chance to pitch to the major studios that will be represented.
Del Rosario has also received offers from Brunei and Malaysia to help them develop their animation industry. These countries recognize the profits to be made not only from production but more so from licensing and merchandising.
Del Rosario hopes that “This will not be another case where Filipino artists help to build up a new industry while the same one in the homeland languishes. “