Indian Animation Industry – Future Perfect— Kulwinder SinghHead – Global Marketing and Communications, Satyam BPO

The global animation industry is all set to explode to double digit growth with India fast

emerging as a leading animation and visual effects outsourcing hub for Hollywood filmmakers. Produc-tion houses in the U.S. are making a beeline to outsource large chunks of work to India, catapulting Indian professionals to a different league of big-budget blockbusters. Although the Indian outsourcing industry is at a nascent stage, the industry’s growth has been phe-nomenal, largely due to the reputa-tion that the Indian outsourcing has earned across the world in a short time. The National Association of Software and Service Companies (NASSCOM) has estimated that the global animation market will grow from USD 59 billion in 2006 to USD 80 billion by 2010. The global mar-ket for animated content and related services is estimated at USD 26 bil-lion and is forecast to cross USD 34 billion by 2010. The Indian anima-tion industry is expected to reach USD 869 million (Rs. 4084.3 crore) by the end of year 2010 at an esti-mated CAGR of 52.2 percent.

Why India is the hub?Qualified professionalsOne definite answer is that large numbers of qualified and employable professionals in India, combined with increasing interest amongst the younger, college-going strata, make the country lucrative as an outsourc-ing destination. Moreover, India’s workforce is known to have the dex-

terity to partner with the clients for better customer service. Also most of the workforce in the Indian anima-tion outsourcing industry has better understanding of English language and this places them ahead of other countries. Cost factor Consider this. It costs anywhere be-tween USD 200,000 – USD 400,000 to produce a 30-minute animated show in the US. The same work is execut-ed in India at a cost of USD 70,000 (Rs. 0.32crore). Companies like Walt Disney Pictures, Time Warner’s Cartoon Network, and Sony Pictures have already outsourced work to In-dia. Though initially it all started with low-end bulk work, Indian com-panies have worked their way up the ladder and are now working on high-end animation. The Indian ani-mation outsourcing industry started work on the cost arbitrage platform but soon moved to the quality pa-rameters for deal making. Now the deals are quality, delivery timelines, and adherence to norms which have ensured that we have an enhanced reputation in the global market.SkillsThe animation industry is still young. Indian cinema is yet to make its mark on the global stage. The boom-ing animation outsourcing industry is constantly demanding new skills and fresh infusion of new talent into the industry. As such, it is impera-tive that we have a healthy pipeline to supply talent to the industry. Skills required in the animation field can be clubbed under two broad cat-

egories, mainly technical skills and soft skills. Programming expertise, analytical ability, and proficiency on the software are basic requirements for technical skills. The number of professionals joining the animation industry has been growing at a com-pound annual growth rate (CAGR) of 18.2 percent and is expected to grow at the same rate. Though India pos-sesses the manpower with the requi-site skill set, what remains an area of concern is the education imparted to this manpower from the quality perspective. This has resulted in mushrooming of multimedia institutes. What is inter-esting is that quite a few reputed or-ganizations have come forward and started a chain of multimedia insti-tutions for two reasons. One, they can use the trained professionals for in-house animation development and secondly, use this education channel for market diversification and pene-tration. However, companies need to invest considerable time and money in bringing these students up to the levels where they start earning rev-enue for the organization. Look at what some Indian anima-tion companies, especially those op-erating in the outsourcing sphere,

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are doing to meet the quality man-power. The solution involves hiring beginners from the market and then imparting training to them so as to bring them up to client expectations. They are also bringing in experi-enced professionals (especially from Hollywood) to train the workforce. Some organizations have even gone to the extent of hiring international talent.

Where is Indian animation heading?The Indian animation industry is currently at the bottom of the ani-mation pyramid. Presently, global outsourcing happens at the produc-tion stage. This involves creation of animation, air-brushing of charac-ters, lip synchronization, scanning, and compositing. As with all the work that we do in the outsourcing space, we are steadily moving up the value chain. The industry is pitch-ing for business in both pre-and-post production stages. In the pre-produc-tion stage, Indian firms are target-ing activities like

Storyboarding l

Dialog writing l

Layout preparation l

Post-production work primarily re-volves around audio and music edit-ing and film compositing. The ma-jor work in this field is happening around content development for TV and broadcast mediums. The pres-ent quality of work being delivered by Indian companies is encouraging outsourcers to look at sending out even high-end post-production work to India. This will enable Indian firms to focus on end-to-end delivery, with the client focusing on the cre-ative and pre-production work. Indian firms are also pitching for work in the visual effects (VFX) are-na as the demand for the same is in-creasing. It is VFX which constitutes majority of the work in the post-pro-duction stage of films. Indian compa-nies today are focusing on low-end work like wire removal, removing tracking markers, crowd multiplica-tion, green matte removal and com-

positing, and set extension. A clutch of companies is putting their ener-gies behind similar work for films. This involves not only convincing customers about the assured quality but also training the resources for delivering international quality of work. Companies like Satyam BPO and Prime Focus have built capabili-ties in the VFX arena. Other creative studios like Cinesite have also done the same.

Partnership modelWith the Indian television and mov-ie industry creating content worth hundreds of hours each day, it is but obvious that Indian outsourcing firms would also look at this form of outsourcing. In an age when ‘Con-tent is King’, many firms like DQ En-tertainment are looking at not just outsourced work but also at co-pro-ducing/sole producing movies. This helps them gain content rights and build their portfolio. These initiatives place India firmly on the outsourcing world map. Many boutique anima-tion outsourcing firms are now solely focusing on generating content and selling it to various organizations. This is not only in the field of movies and episode-based programs but also in the arena of marketing and edu-cative programs. Organizations are targeting the huge market for inter-active marketing and e-learning and using the expertise gained in anima-tion outsourcing to service leading customers in these areas.

ChallengesThe Indian animation industry, how-ever, is not without challenges.Quality manpower shortage. Indian firms are looking at innovative ideas for shoring up their workforce. Apart from calling in industry experts, the industry is also tying up with insti-tutions to develop and impart indus-try specific course content. Government support. The Indian animation outsourcing industry has grown at a scorching pace. This gets dwarfed when compared to the opportunity available in the mar-

ket. Countries like Singapore and Canada are giving stiff competition to the Indian outsourcing industry. They have been able to do so due to the support of their governments. In Singapore, the animation indus-try has made great strides due to the immense support provided by the Economic Development Board of Singapore. It has even formed a Media Development Agency to facili-tate the same. India, though being the pioneer of outsourcing industry, has not found much initiative being taken by the government to promote animation industry. The IT industry is a great example of how industry beneficial policies can help industry growth. What the animation out-sourcing industry requires now is a whole set of policies for its benefit.Intellectual property. Outsourcers have always been concerned with the protection of their intellectual prop-erty in India. India is one of the few countries which have failed to take stern action against its infringe-ment. India needs to strengthen its IP policy and ensure that companies operating in the outsourcing sphere take stringent steps to take care of clients’ IP rights. Ability to scale operations. Indian firms are facing a talent shortage which affects their ability to scale up their operations based on client demands. This also affects the cli-ent’s confidence in offshoring large chunks of work. Though Indian com-panies have put in place huge expan-sion plans, these are often marred by various reasons. Tie-ups with educa-tional institutes are helping over-come this difficulty.

Future PerfectIndia is well on its way to becoming the hub for animation outsourcing. A step further, Hollywood filmmakers are looking at shooting their movies in India. The Indian entertainment industry is booming like never before. In fact, there could be a time when Hollywood flicks will be shot in India, the post production work done here, and the movies sold out of India.

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40 | BROADCAST & CABLESAT | OCTOBER 08 | broadcastandcablesat.co.in | An ADI Media Publication

Kulwinder Singh (Industry).indd 40 10/16/08 12:26:24 PM