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Animation Revolution: An Encore to the IT Revolution? - The PRactice

Animation Revolution: An Encore to the IT Revolution?

As you know, The PRactice has launched the Startup Consulting solution. Within a few short time span we have received significant interest in the market and from our peers. PRMoment also recently highlighted our approach in the article, Startups changing PR narrative from media to stakeholders.

One of the startups we worked with was Broadcast2World, the world’s largest creator of explainer videos. My work in the animation industry helped me understand how the industry in India is changing from being an execution ground to one that has the promise of lending thought and strategy.

The animation industry in India has been undergoing a revolution of sorts over the last decade, not unlike the IT movement and boom of the 1990s. Animation is not new to the Indian market; it has been around for several decades. However, in the last 15 years, it has gained significant traction, and in 2014 the animation industry in India was valued at USD 748 Million and expected to grow at 15% – 20% per annum. Some estimates expect the industry to double in size over the next five years.

Animation is part of the larger Indian media and entertainment sector, which also includes print and television media, as well as gaming and graphic design. But it is animation that is expected to be the main catalyst of the revolution within this larger industry. Similar to the IT industry’s beginnings in India, the main factor that kick-started the growth in the animation industry was labor arbitrage. Having realized that they could significantly cut production costs, several major players in the entertainment industry like Disney, Warner Brothers, Sony, etc. have been working with Indian animation houses for the production process. The industry is also seeing Foreign Direct Investment (FDI), production partnerships and strategic alliances, all of which are indicators that it is on a fast growth path.

Animation production in India costs between 1/3 and 1/4 of what it does in the USA. And even when compared to competitors like South Korea and Philippines, India is still at an advantage cost-wise. Its English speaking workforce also provides a viable pool of talent. Given that India has a huge entertainment industry of its own, second only to Bollywood, the industry can potentially expand at home as well as on the foreign front.

The IT industry started off as purely for labor arbitrage – in other words, outsourcing the execution after the core design and architecture was done overseas, with very little intellectual work involved. But as the industry matured and proved its abilities in a consistent manner, more and more of the IP work started to come to India. Global tech companies started establishing R&D centres in India, and more and more of the products and services were developed from start to finish in India. Today, the IT industry can claim the “brain” along with the “brawn”.

The animation industry in India is on a similar trajectory. Most of the initial work agreements with the global and international companies included little creative work or control. That was done mostly in the West, and the Indian counterparts only got involved in the production process. Over the years however, as the industry has matured, it has been inspiring confidence, and now more and more of the creative work starts in India.

India’s educated and English speaking workforce, especially in the urban areas has always been exposed to Western movies and media. With the advent of the Internet, access to Western shows, news, sports and leisure programmes has only become easier. Indians have been able to demonstrate a level of comfort with Western culture and its idioms and references. In recent times, they have executed projects associated with popular and highly visible Hollywood movies and American TV shows. This has assured global stakeholders that their Indian partners can be entrusted with the creative aspects of the work as well.

Furthermore, animation is not specific only to movies, TV shows and gaming. More and more advertising and marketing campaigns are using animation. It is also becoming popular in educational and instructional material as it is cost efficient, without hampering creativity. Non-media companies, both in India and outside are using animation in their internal and external corporate materials. This broader applicability, along with the global nature of its business, will allow the industry to flourish; the combination of creative and technical work will make it an appealing option and attract more youngsters to pursue it as a specialization and career, and combat the image of it as a “light-weight” profession.

The growth and promise of the animation industry is not without its challenges. The industry will need to be supported by an educational and training infrastructure, so that India continues to offer a sufficiently deep and skilled talent pool. Government support to facilitate foreign and local investment will give the industry the boost to expand and invest in focused technology, training and recruitment. Private investors in India have also been channeling funds into the animation ecosystem. The industry must capitalize on the excitement and anticipation about its potential, and make the right moves to grow, while keeping abreast of the latest global developments, investing in the supporting technology platforms and training. Even though most of the animation business comes from overseas customers, there is growing local demand as well. The industry must attend and grow the local market as well if it is to emerge as a true global leader in animation.