So you think you understand the film and VFX world?

Think again!

 This book will turn everything you know on its head.


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Praise For Inside VFX


Pierre Grage is a senior visual effects professional, who has worked on numerous blockbuster films including Avatar, Harry Potter 5 and Pacific Rim. In this book he lifts the lid on the multi-million dollar secrets of filmmaking and special effects.

Prepare to discover:

  • The untold history of digital VFX
  • What Hollywood’s real business model looks like
  • The true costs of movies and visual effects (you’ll be shocked!)
  • Why evermore blockbuster movies are turning into box office failures
  • How the visual effects business turned from boom into bust
  • If Asia is set to take over the filmmaking industry
  • How the VFX industry really looks from the inside
  • An in-depth investigation on the current challenges of the film and VFX industry
  • Where the future of entertainment is heading

And much, much more.

Based on 10 years of research by working among the best, Pierre Grage describes in uncompromising detail how today’s film business is facing its biggest challenges since the invention of TV.

After reading Inside VFX you will never think of the movie and visual effects industry in the same way.


Pierre Grage is a senior visual effects professional with a useless degree, but enormous interest in economics. His specialisation in digital special effects for feature films has enabled him to live and work across Europe, New Zealand, Australia and South East Asia. He has worked on numerous features films, TV series, commercials and computer games. Pierre has held various positions with leading visual effects houses, including Industrial Light & Magic, Weta Digital, Double Negative and Animal Logic. In 2015, after a decade worth of research he published  his highly praised book “Inside VFX”. For the first time, Pierre’s book covers in great detail and in easy accessible language the business of visual effects. In addition, he leads his readers through the hidden jungle of economics of creating feature films.

Enter Pierre

Part One
Introduction o the Business of Film and VFX

Section 1: Hollywoods Film Business

  • Box Office Deception
  • Where Hollywoods Real Money Comes From
  • Hollywood Demographics
  • Behind The Mask Of Hollywood
  • Low-Risk Film Financing
  • Conculusion

Section 2: Hollywoods Production Costs and Visual Effects

  • Inflation 101
  • Currency Versus Money
  • The Slow Death of the US Dollar
  • Inflation Measurement
  • Hollywoods Real Production Costs
  • Cleopatra – History’s Most Expensive Film Ever Made
  • Titanic – History’s Second Most Expensive Film Ever Made
  • Steven Spielberg’s Cleopatra
  • Conclusion

Section 3: The Digital Revolution

  • 1977 – Star Wars
  • 1982 – Star Trek II – The Wrath Of Kahn
  • 1982 – Tron
  • 1984 – The Adventures Of André And Wally B.
  • 1984 – The Last Starfighter
  • 1985 – Young Sherlock Holmes
  • 1989 – The Abyss
  • 1991 – Terminator 2
  • 1992 – Lawnmower Man
  • 1993 – Jurassic Park
  • 1994 – Forrest Gump
  • 1995 – Toy Story
  • 1996 – Independence Day
  • 1997 – Titanic
  • 1998 – What Dreams May Come
  • 1999 – The Matrix
  • 2000 – Perfect Storm
  • 2001 – The Lord Of The Rings Trilogy
  • 2002 – Spider-Man
  • 2003 – Pirates Of The Caribbean
  • 2004 – The Day After Tomorrow
  • 2005 – King Kong
  • 2006 – 300
  • 2007 – Transformers
  • 2008 – The Curious Case Of Benjamin Button
  • 2009 – Avatar
  • 2010 – Inception
  • 2011 – Harry Potter Film Series
  • 2012 – Life Of Pi
  • 2013 – Gravity
  • Summary
Part Two
Inside The VFX Business

Section 4: The Price Collapse Of Technology

  • VFX Hardware
  • VFX Software
  • Conclusion

Section 5: The Importance Of Digital Visual Effects To The Film Industry

  • VFX Demand
  • VFX Supply and Margins 
  • Conclusion

Section 6: VFX Education On The Rise

  • The Awakening of the Education Industry to VFX 
  • Graphic Design Education Industry as Competitors
  • Conclusion

Section 7: VFX And Globalisation

  • Globalisation 101
  • Industrial Globalization
  • Service Globalization
  • VFX Goes Global
  • Film Subsidies 101
  • How Europe’s Film Subsidies Are Supporting Hollywood
  • How Film Subsidies Influence The Visual Effects Industry
  • Creative Destruction
  • War of the Film Subsidies
  • International Criticism Against Film Subsidies
  • Desperate Measures
  • Foreign Aid for Hollywood
  • Why Are Governments Subsidising Films?
  • Conclusion

Section 8: Asia – The Rise Of A Giant

  • India
  • India’s VFX Industry
  • India’s VFX Scam
  • China
  • Chinas’s Film Industry
  • Hollywood’s Flirt With China
  • China’s Graphic Design & Animation Education Industry
  • China’s VFX Industry
  • Conclusion

 Section 9: The Visual Effects Roller Coaster

  • Top Of The Eighties
  • Apogee
  • Top Of The Nineties
  • Boss Film Studios
  • Dream Quest Images
  • Top Of The Two Thousends
  • Digital Domain
  • Textor Digital
  • Digital Remains
  • Rhythm & Hues
  • No Piece of the Pie
  • Cash Crunch
  • VFX Industry Fluctuations
  • Current Momentums
  • Conclusion

 Section 10: Boom, Doom And Implosions

  • Business Cycles 101
  • History’s First Documented Business Cycle
  • The New Business Cycle
  • Reasons for the Business Cycle in Our Modern Economic World
  • Recessions and the Film Industry
  • The Cinema’s Need for a New Positive Technological Shock
  • Hype Cycle 101
  • Trouble In Blockbuster Town
  • The Digital VFX Blockbuster Hype Cycle
  • Conclusion

 Section 11: Monkey Business

  • VFX Business Models
  • Profiting on Volume
  • VFX Marketing
  • No Honor for VFX Artists
  • War Of The Schedules
  • Digital Killed the Deadline
  • Chaos Coordinating
  • Real-Time VFX Postproduction
  • The Leading Kind Of VFX People
  • Would The Real Business Managers Please Stand Up?
  • The Wrong Kind Of VFX People 
  • The Sociopath’s Inner Urge to a Political Environment
  • The Different Kind Of VFX People
  • The VFX Industry’s Expectation to Work Like an Asperger
  • Conclusion

 Section 12: Under Pressure

  • Threat of New Entrants
  • Threat of Substitute Products or Services
  • Bargaining Power of Customers
  • Bargaining Power of Suppliers
  • Intensity of Competitive Rivalry
  • Conclusion

 Section 13: Back To The Future

  • The Future of the VFX Industry
  • More Creative Destruction
  • Endgame

 Closing Thoughts

The Price Collapse of Technology

Technology is a word that describes something that doesn’t work yet. — DOUGLAS ADAMS

In 1965 Gordon Moore, cofounder of Intel, published a prediction that the performance of hardware will approximately double about every two years. His prediction is today commonly known as Moore’s law.

My personal encounter with Moore’s law started at the end of the 1980s. Like many kids in those times, I grew up on a 1.04 MHz⁠0 Commodore 64. I have the fondest memories of that computer. It gave me hours of fun and even my first coding experiences. But mostly—like many kids my age—I just loved to play the usual computer games, which had very simple graphics. Of course at the time I had no clue that these graphics were simple. To me they were just enough to imagine the rest. Nowadays most kids grow up on little computers called smartphones. Kids can take these little computers with them wherever they please. They can walk while they are enjoying a game with fantastic graphics at the same time. Something I did not dare to dream about in my youth.

If we compare a C64 with an iPhone 5 by numbers, we will find that the iPhone 5 is about 1,300 times faster and easily 500 times smaller. This shows us that Moore’s law is still very much in place. Many different industries and consumers benefit from this trend. Especially since technology did not become 1,300 times more expensive at the same time. Instead technology became cheaper as more people continued to adopt computer technology into their own lives.


VFX Hardware

Moore’s law had a huge impact on the performance-hungry visual effects industry. Industrial Light & Magic couldn’t use a C64 to calculate their first ambitious digital-visual-effects projects. Instead ILM and others started to use so-called “supercomputers” created by a company called Silicon Graphics, Inc. SGI was founded 1982 and specialized in building high-end-performance computers such as the IRIS and later the Octane workstations. An SGI workstation sold for $45,000 to $100,000.⁠1 Since SGI workstations were the fastest commercially available supercomputers, they were also dominantly present in most visual effects offices for many years. SGI made a fortune in its niche market of high-computing performance.

All this began to change in the late 1980s as competition slowly caught up. This forced SGI in 1988 to introduce a lower-priced entry workstation called the Eclipse. This kind of machine was slower but the costs started at $20,000. It was the first sign of a trend that workstations would start to become more affordable. This was Moore’s law in action. The consumers loved this of course, and SGI successfully broadened the company’s customer base. But in the 1990s Apple computers and IBM computers with Intel processors turned out to become SGI’s toughest competition in the low-end-performance computing market. SGI couldn’t compete and saw its low-end market completely melt away. In the high-end computing sector SGI was not the only player. Sun Microsystems, NeXT and Pixar⁠2 went into a fierce competition with SGI over these market shares. But Steve Jobs (who owned NeXT and Pixar) soon had to realize that he couldn’t keep up with the far-lower-priced Intel technology. Pixar soon refocused on making 3-D animated movies.⁠3 Years later NeXT was famously bought out by Apple for its operation system which became OSX. 

In the mid-1990s SGI and Sun Microsystems found themselves competing with Microsoft and Intel computers once again—only this time in the high-end performance computing sector. SGI saw no other choice but to slash prices, and in 1998 they went from $40,000 to $25,000.⁠4 But Windows NT computers from HP and Dell with Intel CPUs were still a lot cheaper and not that much slower. This fact did not remain unnoticed by many people in the visual effects industry.

Visual effects companies started switching from SGI/Sun workstations to Linux- or Windows-based Intel workstations. SGI tried to restructure its business several times but failed to find a new niche. Eventually SGI had to declare bankruptcy in 2009. Sun Microsystems was far more successful restructuring its business from high-performance-computing to high-end-server products. Oracle eventually bought out Sun Microsystems for $7.4 billion in 2010.

The demise of these two companies also marked the end of the high-end-supercomputer cycle. Today this kind of supercomputing power is widely available for very affordable prices. This development became possible thanks to mass production, better as well as cheaper technology and more efficient use of production materials. Outsourcing the production line to Asia further helped to cut hardware-technology costs……………….



Short for megahertz—a measuring unit for computer clock speed. One MHz represents one million cycles per second. Today computers are measured in gigahertz, one billion cycles per second.

1 Source:

2 Both companies worked together on more affordable supercomputing.

3 Refer to Chapter 3: The Birth of the Digital Revolution – Toy Story.

4 Source:





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