THE BLOG
29/05/2014 08:55 BST | Updated 29/07/2014 06:59 BST

The Star Wars Effect - Big Budgets and Tax Breaks Drive Growth in VFX

I'm not sure if you got the memo, but Star Wars is coming to London. As JJ Abrams sets his Star Trek phaser back in its holster and trades it in for a lightsaber, the UK is preparing to play host to Disney's new franchise, and the government's new tax break incentives for the creative industries are a big draw.

Last year painted a pretty bleak picture for the visual effects industry as a whole. Big players went bust and smaller shops around the world struggled to streamline their operations and find a niche that would keep them from going under.

We had the bankruptcies of major players like Rhythm and Hues who were facing the horrors of packing up shop just as their award-winning work on Life of Pi was picking up multiple accolades. While that was the most high-profile example, the slowdown was hitting facilities in every major market including Hollywood and London.

Tax breaks and government backed incentives like the one that's attracted Star Wars over here, are really changing the way the business is set up. The old Hollywood is king model of filmmaking has undoubtedly changed, and Los Angeles is becoming more of an administration centre for studio sign off, while Vancouver, London and other tax incentive-rich areas play host to film crews and post-production facilities by the truck load.

The UK drivers are big. A few weeks ago, in George Osborne's budget speech he announced he'd reinforced the Government's plans to support the creative industries here. Off the back of that ILM has set up its London office and is bringing the force to British shores.

It's not just film that drives it. Northern Ireland is doing well right now as well thanks to big-scale television productions like Game of Thrones. Season 4 was shot on location there. London visual effects house Nvizible opened a branch in Belfast recently to help serve that growing market which is also benefiting from tax breaks.

Aside from tax breaks the other factor that's bringing facilities out of the darkness is diversification on what they do. Whether it was creating their own content or revenue sharing in the production process, diversifying into new markets like amusement park rides, mobile apps for creating content, or working closely with car manufacturers on advanced visualizations. The tough times forced this diversification and it will only make the industry stronger and healthier in the long run.

One example is LA-based Magnopus, which has been set up by Alex Henning and Ben Grossman, who won the 2012 Oscar for Scorsese's Hugo. The pair are making use of their technical knowledge of production pipelines as well as their creative prowess and applying it to new industries like interactive museum installations.

Whether it's the climate created by film-friendly governments, or the move away from Hollywood by the larger franchises and production houses, the VFX industry as a whole is looking a lot healthier than it was last year.

Success moving forward is going to be about being smart, staying nimble and taking advantage of the incentives in place and the pools of talent that really enable the creative process more than anything else. Together we will boldly go where no-one has gone before.