February 11 2008

Global Business: Top Business Teams; Top Business Teams
Kathleen Kingsbury
Time
Volume 171; Issue 6; ISSN: 0040781X
(c) 2008 Time Incorporated. Provided by ProQuest Information and Learning. All Rights Reserved.

How Lucasfilm is turning Asia's young artists into the next generation of digital-animation pioneers.

The Force is definitely with Travis Ho. Like millions of computer-science students before him, the 19-year-old Singaporean's lifelong fantasy has been to work for Lucasfilm, the empire launched 30 years ago by George Lucas, the creator of Star Wars. Ho, however, did not have to journey to a galaxy far, far away; Lucasfilm came looking for him.

Eighteen months ago, the digital-art powerhouse launched its first overseas studio in Singapore. The 170 employees come from 33 nations, and together they make sure that Luke Skywalker's animated cloak swings naturally in the TV series Clone Wars and that Jackie Chan slides effortlessly down the Eiffel Tower in Rush Hour 3. Like their colleagues back at Lucasfilm's San Francisco headquarters, the Singapore crew members work in jeans and decorate their cubicles with their favorite Star Wars action figures. But while years of experience and Yoda-level technical skill are prerequisites for joining Lucasfilm's U.S. team, the developers and animators in Singapore were hired less for their résumés than for their artistic eye. Students like Ho at Asian universities are its top potential recruits. "Our experiment is to take the most talented, passionate artists we can find and give them the necessary technical know-how," says Gail Currey, vice president and general manager of Lucasfilm Animation. The company's goal is to turn Singapore into a base for a new style of animation that combines East and West and could serve as a template for other U.S. studios expanding abroad.

Lucasfilm is the first major production studio to set up shop in Asia, but competitors are right behind it. For years Hollywood has cut costs by outsourcing post-production--the editing, sound mixing and special effects that turn raw film into a blockbuster movie--to overseas firms. More than 90% of the animation for American films and television shows is processed in Asia, mainly in Japan and South Korea. Now, however, the $100 billion animation industry is rushing to tap the deep pools of young, well-trained artists in countries such as Singapore, China, India, South Korea and the Philippines.

That young Asian talent forms the core of Lucasfilm's Singapore team. Ian Pang, 29 and Singaporean, studied Japanese thinking he would one day have to move to Japan to design video games. "I thought I was going to have to pack my bags; Singapore had no games industry," Pang says. Instead, he now produces the latest Star Wars handheld game from Lucasfilm's 40,000 sq.-ft. (3,700 sq m) office space near Singapore's Changi Airport. Ho, the computer-science student, says he struggled to convince his parents that he could make a living in digital art and gaming. "Having Lucasfilm here really legitimizes the field as a career choice for Asians," Ho says. Not all of Lucasfilm's talent in Singapore is homegrown. Canadian Kalene Dunsmoor, 27, was designing motorcycle decals in Toronto when she sent her portfolio on a whim to a Lucasfilm recruiter. Now she works in Singapore, collaborating with Lucas' iconic special-effects shop Industrial Light & Magic to add computer-generated imagery to films including the Harry Potter and Indiana Jones series. "They were willing to take a chance even though I didn't have conventional experience," Dunsmoor says. "I was willing to travel far from home for that."

Lucasfilm didn't open its office in Singapore just to fulfill the dreams of a few dozen lucky young sci-fi fans. The company's desire to develop these workers into cross-disciplinary, creative thinkers will be crucial to its efforts to turn every Lucasfilm project into a multiplatform, multimedia event. Since arriving at Lucasfilm, both Pang and Dunsmoor have gotten intensive training in classical art, and their more experienced colleagues have helped them sharpen their technical knowledge. Those skills can be applied to any medium Lucasfilm works in, from feature films to TV animation to video games. "We keep talent by letting them work on all our projects, from games to movies to TV. Nobody else in this business gets to do that," says Micheline Chau, Lucasfilm's president and COO. Being able to create content across several disciplines, Chau adds, is "the new world order in entertainment."

It's also, of course, a cost-effective strategy for Hollywood. As paychecks for actors get higher every year, studios are putting more effort into developing films like 300, which proved that gorgeous digital effects can draw box-office numbers as big as any movie star. "It's not just the actors but also elaborate sets, huge [production] crews and worldwide marketing campaigns," says Vivek Cuoto, executive director of Hong Kong-based consultancy Media Partners Asia.

Animation is even cheaper when it's produced in Asia, but Lucasfilm executives deny that cost cutting brought them to the region. Still, the move has allowed them to experiment with new ideas--including its first animated TV show--and take chances on young talent without as much financial risk. The Singapore studio's less experienced artists demand lower salaries than their California counterparts, and Lucasfilm doesn't have to navigate U.S. immigration laws to hire them. And by making use of the 16-hr. time difference between Singapore and San Francisco, Lucasfilm has essentially doubled its productivity.

Lucasfilm's biggest competitor in animation, Disney, has so far limited its creative forays in Asia to teaming up with local companies, using a very different formula with some early success. In June, Disney released The Secret of the Magic Gourd, its first Mandarin-language film made for mainland China. But the movie was produced entirely by Hong Kong-based Centro Digital Pictures. Under Disney's watchful guidance, Centro adapted a classic Chinese bedtime tale, shooting and editing it into a 90-min. live-action feature. Disney then directed the film's marketing and distribution. The Magic Gourd became China's top-grossing children's film ever, generating $2 million in its first two weeks, says John Chu, Centro's founder, who oversaw the production. "It was a matter of finding a story that matched Disney's values but also resonated with every Chinese youngster."

Disney announced a similar alliance last June with India's Yash Raj Films, one of Bollywood's premier studios. The two companies will produce a series of computer-animated films in Hindi using nearly all local talent. Their first co-production, Roadside Romeo, is set for release later this year. "We believe that China, India and Russia are the main strategic markets from which our growth will come in the future," says Jo Yan, senior vice president of sales, co-productions and acquisitions for Walt Disney Studios Motion Pictures Asia Pacific. "But at this point we're not arrogant enough to think that we know everything about these markets, so we believe working with key partners is the way to go."

Lucasfilm, on the other hand, believes that its team in Singapore will be an integral part of every film or video game it produces for every market--not just in Asia. "We've always concentrated on making sure our characters have global appeal," says Christian Kubsch, managing director of the Singapore studio. In fact, the company has made Singapore a key part of its strategy. Company execs see it as a launching point for building the brand in neighboring countries like China and India, two of its fastest-growing marketplaces. The Singapore studio will also spearhead Lucasfilm's first animated feature film this year, and its employees will soon make up at least one-third of Lucasfilm's staff.

Asia's fast-growing economies welcome the investment and are putting their resources into nurturing the digital-animation industry. Singapore hopes that by 2018, digital media will generate $10 billion a year, or about 5% of last year's GDP. India's animation sector has grown 50% over the past two years and is expected to attract $950 million in outsourcing contracts with Hollywood studios by next year. The number of animation departments in Chinese universities has quadrupled, to more than 400, over the past five years, and animation supports a nearly $2 billion industry. Thailand has sold popular television cartoon series to China and South Korea and hopes to export more than $2 billion worth of products by next year. Working with local universities to incorporate animation into curriculums, the Animation Council of the Philippines plans to have more than 25,000 digital artists by 2010

Another, smaller player is the rogue communist state of North Korea. Under the patronage of leader Kim Jong Il, a movie buff, animation is one of the rare sectors in which North Korea is following the global trend. Animation houses from North America, Europe and Asia have all subcontracted work there. The state-owned SEK Studio last year paired up with South Korean animators to produce Empress Chung, a $6.5 million animated feature film based on a Korean Cinderella story.

The bane of any creative industry in Asia--intellectual property protection-- remains the most pressing concern for animation. Chu, who has worked in animation in Hong Kong for more than 20 years, has given up. "There's really nothing that can be done," he says. "The only hope is that someday our product is cheap enough that it's not affordable to counterfeit." Lucasfilm, on the other hand, chose to operate in Singapore because of the country's strict copyright laws and advanced legal system. "We feel comfortable that the infrastructure is in place to protect individual IP," says Kubsch.

For now, Lucasfilm's biggest challenge is snatching up the best talent within Singapore's burgeoning digital-arts community before rivals move in. In November, the studio launched the Jedi Masters Program, a two-year paid apprenticeship designed to attract Singaporean students like Travis Ho. Lucasfilm better move fast. Ho, who won't graduate for another two years, has already co-founded a small video-game development firm that has gotten government and foreign contracts. "It's a small operation," Ho says. "But we're doing pretty innovative stuff for beginners." It's no match for Lucasfilm yet, but who knows? The next George Lucas may be working for him in Singapore.