The Digital Divider

A writers’ strike has been averted, but far more profound and potentially devastating forces still threaten to reshape the character of the world’s premier fantasy factory. Hollywood’s work force, particularly its largely unionized blue-collar segment, may be the most affected.

New digital tools, ranging from computer graphics to transmission technologies that expand the Internet’s capacity, are the principal drivers of the change. They offer great opportunities for some entertainment workers and companies but could well destroy the livelihoods of many others.

The most vulnerable segment of the Hollywood work force is the roughly two-thirds of the estimated 250,000 entertainment industry employees whose jobs have traditionally been categorized as “craft’--lighting technicians, film and music editors, prop and set builders and so on.

“This is an exciting time in terms of technology, but it’s also very dangerous,” says Bruce Doering, local head of the International Alliance of Theatrical Stage Employees, the largest collection of craft unions with some 35,000 members in Southern California.

To date, digital technology’s impact on the entertainment industry has been limited by both the endurance of older media and the technological shortcomings of the Internet, its primary means of transmission. Yet, its challenge to the traditional structure of Hollywood, both inside the union hall and boardroom, is indisputable.

On the one hand, digital technology replaces skills previously done by hand for generations, like building sets. On the other, largely unregulated and open access to the Net jeopardizes the established media oligopolies’ control over the means of distribution, their traditional source of power.

The threat to Hollywood’s blue-collar work force comes at a time when many craft unions are already suffering from “runaway” production to lower-cost locales such as Canada, Australia, New Zealand and Mexico. Between 1990 and ‘98, the foreign, largely Canadian, share of U.S.-generated movie production grew from 29% to 37%, while the foreign portion of U.S.-generated television production grew from 28% to 42%. This transfer of production, Doering says, has already eroded the historic advantage of the Hollywood “supply chain” by bolstering similar skills in countries with lower production costs and fewer labor headaches. By contrast, the “white collar” or creative side of the business--writers, producers, directors and top-drawer actors--has been barely affected by runaway production.

The far larger, long-term problem for labor lies in the fact that the firms and individuals mostly engaged in digital technology are outside unionized Hollywood. Few of the top computer-effects companies, for example, have strong trade union representation.

Much of this has to do with the changing nature of work not only in entertainment but throughout many parts of the private-sector economy. The old Hollywood union structure, like the studios themselves, arose at a time when specialization of skills allowed for narrow definitions of jobs, which is critical to traditional trade union organizing.

But in Hollywood’s new economy, dominated by the emergence of digital imaging, both the scope of company operations and job descriptions tend to be far broader and less defined. Many digital-entertainment firms do business in a host of media-related fields, including commercials, theme park development and computer games.

As such, these companies serve not only traditional Hollywood studios and producers, but also non-entertainment corporations, hotel chains and various new-media companies. For them, there is no set of bosses with whom to negotiate contracts, since the “bosses” come from a dizzying array of fields--game companies, retail chains, advertising agencies and real estate development companies. The digital work environment, furthermore, requires companies to employ a highly flexible work force. Digital artists create images, to be sure, but they also edit music and seek to write, direct and play other roles in production. They rarely desire to stay within a single “craft.”

Most critical, many digital firms envision the Internet as their primary distribution pipeline, which remains basically nonunion. “The Internet,” says Doering, “is the Wild West.”

Companies that can exploit the new technologies of the Wild West have enormous opportunities. “The studios don’t have control of the pipeline,” says Dan Chuba, c-founder of Hammerhead Productions, a small “cybergnat” digital-effects firm in Studio City.

Over the past two years, Chuba’s company, which employs 14 nonunion people and contracts with many others, produced one low-budget film, helped produce another more elaborate one, took on loads of special-effects work and started making its own music videos.

Chuba and other new-entertainment executives believe the shift toward digital media is in the offing. More and more movie theaters are closing, ticket sales are flat or declining, and Internet viewing hours are steadily rising as TV watching slides.

Even more intriguing is the potential of “virtual stars,” which could devalue the importance of the Screen Actors Guild. Already, some studios, such as Square Pictures, a Japanese-owned firm based in Hawaii, have created essentially synthetic actors. Down the road, if stars become unavailable or impossible to work with, firms may be tempted to look at these ersatz alternatives.

A Glendale firm, IdeaSpa, is moving to exploit the new market for what principal founder Jeff Bacon describes as “synthespians.” These artificially created characters are already starring in computer games. Synthespians, Bacon says, “don’t go on strike, they can speak any language, they don’t get old--unless you want them to. If you want to have a character with the voice of Aretha Franklin and the body of Jennifer Lopez, you can get it.”

Such digitization could erode Southern California’s long-standing predominance in entertainment. For one thing, cyber-based entertainment can be located virtually anywhere. Other regions, notably the Bay Area and Seattle, have demonstrated they can more than hold their own in developing new entertainment forms. Even selected rural areas, such as the Berkshires in Massachusetts and bucolic locales like Santa Barbara, could become players in this digital entertainment landscape.

Still, much of this work will remain clustered in Greater Los Angeles because it is home to the vast majority of the nation’s creative talent. “A lot of the skills will apply--an animated digital property still needs lots of people,” Bacon says. “There will still be a talent pool, but it may be a different talent pool.”

None of this suggests that the digital entertainment universe will evolve without inflicting some economic pain. “Below the line” workers--cameramen, grips, lighting technicians, prop managers--may face a tough time maintaining the bargaining power they have enjoyed in an analog environment. Skills that were cultivated, and unionized, in the analog age will need to be either reorganized or reformulated if they are to be adequately represented in the new environment.

The large entertainment conglomerates, despite their bulk, may fare no better. To date, their efforts to enter the digital world have proved almost uniformly ham-handed. They have yet to demonstrate any agility in dealing with cybergnats and individual artists whose dependency on the giant’s distribution and financial power diminishes daily.

The failure of Disney, Warner Bros. and the other studios to capitalize on the Net or to stay in the forefront of digital imaging--forcing them to rely on such upstarts as Square, Pixar, Digital Domain, Rrythym and Hues and Hammerhead--reveals how out of sync the giants are with the latest entertainment technologies.

Southern California, now twice as dependent on entertainment-related work than a decade ago, also needs to transform itself. Its schools, from elementary to graduate levels, must become more adept at providing the education infrastructure required by a digitized economy. At the same time, the region must become more focused on developing and preserving the critical lifestyle accouterments--safe streets, cultural amenities and an attractive physical environment--that attract the new breed of digital artists.

How the region responds to these challenges, far more than what is taking place at the picket lines or the negotiating table, will determine how successful our signature industry reorients itself to the realities of the digital age.