In recent years, the animation industry has experienced moments of glory with box office successes; however, behind the scenes, the industry is facing an unprecedented crisis. In this video by No The Robo explores the five main reasons for the animation industry’s crisis and how they could affect the future of animation and the artists involved.
The Animation Industry Is on the Brink of Collapse: Here’s Why
1 The Streaming Bubble
During the 2020 pandemic, while many film productions were halted, animation saw a boom due to its predominantly digital nature. Streaming platforms invested heavily in animated content to meet growing demand, creating an economic bubble. However, now that the pandemic is over, it has become clear that the economic models of streaming are not as sustainable as traditional box office releases. This has led to a drastic reduction in investments in original animation, with major studios preferring less costly and safer projects.
2 Mass Layoffs of Artists
In recent years, almost all major studios have undertaken massive layoffs. Netflix reduced its animation team by a third, Disney laid off 20% of Pixar staff, and many other companies like Warner Bros. and DreamWorks followed suit. These layoffs come after a period of rapid hiring during the pandemic, creating instability for thousands of workers. Artists who were hired with the promise of long-term projects now find themselves without jobs, while the executives who made these decisions rarely face consequences.
3 Outsourcing to Cut Costs
To reduce costs, many studios are outsourcing animation work to countries with cheaper labor. Disney opened an animation studio in Vancouver to take advantage of Canadian tax credits. DreamWorks has started outsourcing much of its work to foreign studios, such as Sony Pictures Imageworks in Canada. These changes often lead to brutal working conditions and low pay for animators in recipient countries, where workers are not always protected by strong unions.
4 Industry Consolidation and Mergers
The film industry is experiencing a wave of mergers and acquisitions, often leading to the closure of animation studios. A significant example was Disney’s acquisition of 20th Century Fox, which resulted in the closure of Blue Sky Studios. With the growing presence of tech giants like Apple and Amazon in the entertainment industry, traditional Hollywood studios are struggling to stay competitive, and mergers seem like a quick solution, often at the expense of creativity and jobs.
5 The Threat of AI in Animation
Artificial intelligence (AI) is emerging as a significant threat to employment in animation. AI-based video generation tools are rapidly improving, and there is fear that they could replace much of the human work. According to a study by the animators’ union, over 118,000 jobs in animation could be eliminated or replaced by AI by 2026. This prospect is particularly concerning as companies see AI as a way to cut costs, without considering the quality and experience that human artists bring to projects.
Possible Solutions and Hopes for the Future
Despite the grim picture, there are two positive aspects that could save the animation industry:
1. Support for Independent Animation: The future could see growth in independent studios creating innovative and high-quality content. These studios, free from the commercial pressures of large conglomerates, could bring a new wave of creativity and originality to animation.
2. Union Mobilization: Union negotiations and possible strike actions could lead to significant changes in working conditions. Animators need to fight for protections against AI use, better working conditions, and more secure contracts.
The animation industry is at a turning point. Artists and supporters must unite to defend the value of human creative work and ensure a sustainable future for animation. Only through collective action and support for independent creativity can the industry rise from its current difficulties.