From ads to entertainment: inside the new Oktobor

Behind Nickelodeon cartoons such as The Penguins of Madagascar and Kung Fu Panda: Legend of Awesomeness is a team of animators who just happen to be based out of New Zealand.

Over 100 designers, texture artists and digital creators of all sorts lovingly handcraft each character and scene from Oktobor’s headquarters in Sale Street, Auckland.

Oktobor Animation launched in early 2010 as a joint venture between Omnilab Media’s visual effects arm (known as just Oktobor then), and US animation company Backyard Animated Pictures. Backyard brought its four founders, their knowledge and the all important animation pipeline.

In day one there were five staff, the next day there were 30 animators and within 10 months that number had grown to 115. Oktobor now has 145 staff, of which 140 are involved in the animation process.

I speak to head of production Rob DiFiglia and managing director Bruce Everett about New Zealand’s blossoming digital creative scene and what challenges and opportunities lay ahead for Oktobor.

(Left: Rob DiFiglia; Right: Bruce Everett)

The Oktobor which was a part of Omnilab worked mostly on advertising visual effects. Why the shift into animation?

Bruce: In 2008 Oktobor was recognised as one of the top design houses in the world for commercials. It was also the year the  global financial crisis hit and we saw advertising shrink. Agencies as a whole started to do change the ways they did things. Necessity meant we needed to move beyond this shrinking market and we looked outward for a global business opportunity.

I imagine New Zealand animators are more expensive than those in India or China. What’s the advantage then for a movie or TV studio to send its work here?

Rob: Most of our work comes from LA. The US and New Zealand have similar cultures, share the same language and the time difference is minimal – three to five hours. Dealing with the US has been really good.

Bruce:  It’s challenging to send work to emerging markets because the quality level is never assured … A lot of our contracts came out of ones originally from India. The cost is only part of the equation.

We have an animation pipeline we’ve developed here which lets us be efficient without affecting quality, it’s something Nickelodeon and Dreamworks really appreciate.

For most of Oktobor’s history it’s been a service company. More
recently you’re working on your own IP with projects like Mech Mice [a
tactical RPG game, which Oktobor owns 40 percent of]. Is there a risk
that your current clients like Nickelodeon and Dreamworks will come to
see you as a competitor?

Bruce: We started as a service
company and believe it was a great foundation to build our own IP.
Basically it’s good to be able to show that you can walk the talk and
having our own projects helps us demonstrate this. We don’t think
they’ll see it negatively, it gives our work much more credibility.

Is New Zealand’s tertiary institutes producing enough graduates with the skills you need to grow Oktobor?

It’s definitely been growing for six years now. The quality of artists
coming out of the schools here is tremendous and there’s a lot of
interest in these careers … I think there is a decent pool of artists
in New Zealand.

We’re also helping feed into the industry. A
lot of the graduates come to us as a first step in animation then we
send them off to Weta where they get another level of experience.
Likewise Weta sends people up to us.

Are there any challenges working with clients from across a vast ocean? How reliant is your business on the ups and downs of New Zealand’s internet infrastructure?

Rob: The internet is our lifeblood, it’s our connection to the rest of the world. Everyday we’re sending out 70 to 100 GB of data and footage and we’re getting about the same back. If there’s a break in any of that it really affects our business.

What speeds are you getting here [in Freemans Bay]?
Bruce: Around 20 Mbps which we’re splitting up around the building … Remember that when people went from dial-up to broadband it didn’t just help them do things faster, it completely changed the way they did business. The speeds that are available to us in New Zealand right now and the cost for data are barriers to the way we work and a barrier to how we can evolve the business.

Rob: We are competing with India and China and the best way we can do that is staying one step ahead. The projects we see coming up in the future involve large collaborative components domestically and overseas and to get that level of engagement we need better infrastructure.

Are you looking to move out of this space to somewhere with a fibre connection? I hear you’re looking at the Wynyard Quarter Innovation Precinct.

Bruce: We’re looking at Wynyard Quarter, but at this point I can’t say much more than we’ve expressed an interest and are supportive of what they’re doing there.

How much support financially (or otherwise) does Oktobor receive?

Bruce: Our exports to the US have 15 percent support from the [Post, Digital, Visual Effects (PDV) grant from the Ministry of Business, Innovation and Employment (MBIE)]. With that being in place we can be even more competitive cost wise.

And what obligations are you under from that grant?

Bruce: Everything we claim for has to be 100 percent New Zealand. The work we do has to be done in New Zealand.  

What we also give back to the PDV is the culture of businesses that are created around successful exporters. We want our competitors to succeed and grow around us, because that only grows New Zealand’s exposure and our exposure along with it.

What initiatives (government or cross-industry) would truly help your company develop and grow similar businesses?

Bruce: The strongest stimulus for companies like ours would be more domestic work. Children’s TV and animation is neglected in New Zealand, while 400 million people worldwide watch the shows we’re creating world wide. Having more content being produced domestically would give the country a beating heart to rely on and a stepping stone for the smaller boutiques who are just starting out.

But how financially realistic is it for a country of 4.5 million people to produce more kids content?

Bruce: If you talk to the heads of TVNZ and Sky they’ll probably say it’s totally unrealistic. But if you put the challenge to New Zealanders and say we have X amount of money we’re going to spend on this content, someone will find a way and create a business around it.

Rob: They key is to make good content, that’s also good overseas. We need to create content that can be exported globally and not be to stuck on making it strictly for New Zealand.

Finally, do you have any advice for any other budding animation studios looking to take you on?

Bruce: Engage with your customers directly. There’s a lot of power with having a direct relationship. We’ve benefited greatly from having Chris [Waters, business development lead] working from Los Angeles. The relationships and friendships he has both casually and professionally is something we just can’t replicate by going on a sales trip once or twice a year.

Also, prioritise quality over price. It’s a mistake to compete on price and if we price our way to the bottom [the studios will]eventually take their money to India anyway. New Zealand needs to and can differentiate with value and quality.

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