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The Southeast Asian state is wooing Western media firms to help build its digital economy, but its reputation as an outsourcing hub will take time to displace.
The Southeast Asian nation-state is intent on building a world-class media production hub from scratch, and wants to achieve it by the end of the decade.
Its Media Development Authority (MDA) has identifi ed media and entertainment, in particular interactive and digital media, as one of the country’s major sources of revenue, and plans to raise the value of media exports threefold to £29bn by 2015.
To get there, it is rolling out a nationwide 1Gbps broadband network, has a £254m pot for incubating new digital technologies, and has allocated £93m for media development over the next five years.
At the same time, educational institutions are supplementing their traditional mathematical, engineering and medical programmes with animation, games and visual effects courses to provide a skilled labour pool.
While this is intended to lay the foundations for 80,000 new media jobs, the territory is largely servicing US and European fi rms that outsource work to employees on lower salaries while posting foreign talent to senior creative and managerial positions.
Knowledge transfer
“We are taking a bottoms-up approach to growing the digital media industry,” explains Bernard Sieu Kar Wei, head of Infocomms and Media, a division of Singapore’s Economic Development Board. “The aim is to build a sustainable industry, which in the first instance requires the knowledge transfer of companies outside Singapore, but will in turn generate a critical mass of homegrown talent to create our own IP.”
“We are taking a bottoms-up approach to growing the digital media industry,” explains Bernard Sieu Kar Wei, head of Infocomms and Media, a division of Singapore’s Economic Development Board. “The aim is to build a sustainable industry, which in the first instance requires the knowledge transfer of companies outside Singapore, but will in turn generate a critical mass of homegrown talent to create our own IP.”
The average annual wage for new, local recruits is £20,000, but there is demand for experienced overseas talent in roles such as games developer, modeller, animator or VFX supervisor, who could command higher than their current UK salaries while enjoying one of the world’s lowest personal tax regimes, capped at 20%.
“The technical skills base here is excellent but we still require the softer skills such as scriptwriters and directors,” says Ricky Ow, general manager of Sony Pictures Entertainment Asia.
Singapore is wooing Western companies with highly attractive financial packages. These range from a light corporate tax rate of 17% (which can be negotiated lower), to subsidised training, particularly for permanent Singaporean residents, or relocation schemes in return for investment in research and development.
“Direct company support is not infinite so the business case has to be enduring,” says Angeline Poh, director of Infocomm and Media. “We’re able to award tax and fi nancial incentives but we adopt a bespoke model of support for each company.”
The government keeps details strictly under wraps, and threatens to sue companies for breach of contract if they reveal them.
LucasFilm, which became the first major Western film-maker to set up in the region in 2005, stresses that its 400 artists, representing 6o nationalities, have moved beyond simple animation assembly and work for hire.
“There was no local talent when we arrived but we’ve invested, with the government, in media training courses and brought staff in from New Zealand, London and LA to mentor and grow the market,” says LucasFilm general manager Xavier Nicolas. “We trained students on TV animation and games disciplines, and we are now moving into animated features and VFX sequences - for example, on Transformers 3D.”
Nonetheless, all the concept art and post-production - the more creative and client-critical aspects - is still handled in LA.
Building experience
Soho VFX house Double Negative opened a Singapore branch last May, but doesn’t yet trust the operation to work on more than the heavy lifting of visual effects work for features like Iron Man 2 and Kick Ass.
Soho VFX house Double Negative opened a Singapore branch last May, but doesn’t yet trust the operation to work on more than the heavy lifting of visual effects work for features like Iron Man 2 and Kick Ass.
2D supervisor Oliver Atherton helped set up the operation. “I’ve had to stay on longer because it has taken more time than we thought to train staff,” he says. “The work culture and technical skills are good; it is experience that is needed. We are now seeing better-quality recruits from the local colleges and we’re promoting staff we’ve trained into supervisory roles.”
Double Negative is located next to Media polis, a proposed £441m, 19 hectare production and studio complex. The fi rst phase, an 18,000 sq ft sound stage with green screen, will be ready in 2012.
Almost all of the existing sound stages in Singapore are occupied by MediaCorp, the state-owned broadcaster. By 2020, the new stages will be surrounded by digital media outfits, broadcast and post-production facilities, digital rights management and education institutions. LucasFilm is moving to an adjacent site next year “The purpose of the sound stage is to support digital and VFX productions but it will also be modular for TV-sized projects,” explains Poh. “We want to create a Soho-style cluster of media enterprises and we are talking to UK companies about locating here.”
Mediapolis’ business plan is still being nailed down by local post house Infinite Frameworks, which will manage the site. It will, however, compete with a larger studio being built by Pinewood Shepperton just over the border at Iskandar in Malaysia. Scheduled to open in 2013, it will provide more than 100,000 sq ft of film stages and nearly 60,000 sq ft of TV studios, plus post facilities.
Singapore is prepared to invest in co-productions, particularly in animation, and to make the domestic industry more competitive with tax breaks. The number of animation firms in Singapore has grown from 10 to 40 in five years and many are moving up the value chain.
Scrawl Studios (Singapore) and UK animator Bryant Whittle are codeveloping and producing 52 x 11-minutes of pre-school series Red, Yellow & Blue, while Singapore’s August Media Holdings recently acquired Edinburgh animator Red Kite (64 Zoo Lane) and signed a $60m deal with US media company Classic Media to develop and jointly produce 10 new shows for TV. They will be based on children’s classics from Classic Media’s catalogue, which includes Mister Magoo.
Under another recent deal, animation projects co-produced with Fremantle Media, through its Singapore office, will receive up to £2.2m in funding from the MDA. The government body has also earmarked £40m for five feature films, can provide seed money to entrepreneurs in the digital media space, and will match-fund co-productions.
South West Screen, with UK Trade and Investment money, has taken advantage of this by co-funding multiplatform projects. Eco Gone Mad, a factual entertainment web and TV format by Apostrophe Films (Singapore) and the UK’s Junction K, and animated series iLand, produced by Scrawl and Bristol’s Wonky Films, have each received £50,000 in funding.
In addition to public money, a $1.3bn (£800m) pot of venture capital has been ringfenced for film and TV projects.
With Asia Pacific media predicted to grow at 6.4 per cent a year to $475bn (£290m) in 2014 (according to PricewaterhouseCoopers), Singapore is positioning itself as the launch pad into the market. The country already hosts regional headquarters for broadcasters including Discovery, SPE, ESPN and HBO. Indie Off the Fence has a distribution office, and there is local distribution support from Ascent Media and Technicolor.
“Right now, all the work we do originates from Europe or the US, but the Asian market for visual effects is huge and we are using Singapore as a base to crack it,” reveals Double Negative operations manager Cosmas Lee.
“There are some rich stories in Asia from India to Malaysia and China that have yet to be exposed to a global market,” adds SPE’s Ow.
Beyond the basic economics, the initiative is viewed as culturally significant. “We want to grow games, VFX and animation as well as convergent media forms, but we see interactive media playing an integral role in every day life,” says Poh. “Digital visual literacy will be increasingly important as a global communications medium, and Singapore can lead the world in its development.”
With a highly educated population and little free land for industrial development, media technology is at the heart of Singapore’s economic strategy. While UK media braces itself for further cuts, Singapore’s government is committed to subsidising the next-generation digital media industry.
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