[Hollywood Report I] Why China Cannot Copy Hollywood

Hollywood was never planned as an organization. It barely counts as one at all. If you must fit it into a system, it looks most like a "cellular automaton."

Regular article

In late 2014, Tamar Shaham signed a contract with 20th Century Fox to work as a "visual effects coordinator" on the studio's upcoming film "Deadpool."

Her job was to track whether five outsourcing companies scattered around the world would finish on time, and to pass messages among the director, the visual effects supervisor and the studio. In the end, 21 of the film's key creative staff would appear in the credits that flash by after the film ends.

This was the closest Tamar had ever come to 20th Century Fox. A few years earlier, while at an independent effects house, she had worked on a Fox project. Big studios like Fox routinely split hundreds or thousands of effects shots into batches and farm them out to several post-production effects companies. The artists at those companies only have to deliver on schedule; they may never meet anyone from the studio.

But an offer from Fox did not make Tamar a Fox employee. The studio would not keep a desk for her. Like most "talent" in Hollywood, she belongs to no institution. When "Deadpool" is done, she will pack up and go looking for her next contract. "You can't stay in one place for 20 years. You finish one project and move on to the next," Tamar said. "The effects business is always bustling, and Hollywood is the same."

When we think of Hollywood, we think of the six major studios (if we don't think only of the Beverly Hills street sign and the Walk of Fame), as if most people in the business worked for these few giants. They don't.

Director Mark Roseman remembers that in the 1980s, big studios like Disney were still happy to sign long-term deals that gave directors equipment and offices for years at a stretch. By 2004, when Roseman made "A Cinderella Story," Warner Bros. provided an office only for the life of the project. Roseman had to rent a small room in West Hollywood with his own money, and came to think of himself as a "sole proprietor."

Director Mark Roseman

We are used to the power of an efficient institution. Such an institution usually gathers people around a vision or a mission; they share similar values and, guided by some grand strategy, complete one (profit-making) task after another. We usually call such institutions companies.

IMDb Pro assumed the same at first. The film database site, owned by Amazon, has 200,000 registered users, and it set out to become "the LinkedIn of the entertainment industry": like LinkedIn, it would link users by "company" and build services on top of that. After a while it found that Hollywood doesn't work that way. Because people changed employers so often, more than 80% of users were connected to one another within three degrees, yet in reality they barely knew each other. This proved at least one thing: what ties these 200,000 people together is not companies.

The IMDb Pro home page

In a new version launched last March, IMDb Pro began linking users through film projects instead. "The whole industry follows projects," explained Wang Jue, a former software engineer at IMDb Pro. If two people have worked on the same film, they are naturally close. Tamar's story bears this out. She got onto "Deadpool," she explained, because the film's visual effects supervisor had worked with her on an earlier picture. "He brought me in," Tamar said.

In a piece titled "What Hollywood Can Teach Us About the Future of Work," New York Times reporter Adam Davidson summed up what he called the "Hollywood model." Traditional companies used to offer long-term security and a sense of cohesion; Hollywood is used to doing business short-term and project by project: "pick a project, form a team, finish the project, disband."

Claudia, a young 20th Century Fox employee, agrees that breaking up when a project ends "opens up more possibilities." In the Hollywood she has seen, the stable jobs are mostly in routine administrative work. The studio's marketing department is full of veterans with more than 20 years on the job, but that is not the most valuable part of Hollywood. In a creative industry, the scarcest thing is always creativity.

Claudia had just attended a party for a marketing colleague's 40th year at Fox. This colleague truly counts as a founding elder: in those 40 years, Fox has gone through three chairmen. At a party meant to celebrate "belonging," Claudia spent most of her time thinking about how to leave. She plans to go back to school to learn how to manage budgets and development in the early stages of a film, so she can join the exciting work of making movies. Quite possibly she will end up, like Tamar Shaham, living a "rootless" life.

The six majors don't seem to want to keep this energy, or this creativity, to themselves either. A big studio would rather set up a separate independent film company than tie directors to its own bureaucracy. This is even truer of specialist roles: a small independent company or an individual with a clear specialty should be more creative. No institution or person can manage creativity well, so the studios simply keep it outside their walls.

Adam Davidson, the New York Times reporter, was able to see Hollywood's business model up close partly because the "project system" made him a "financial technology consultant" on a film. What excited him was not just the business model but the fact that this "project system," with no center and nobody directing the details, ran so smoothly:

"These people had never worked together before, and some of the scenes shot that day were quite complex, requiring everyone to work in tight coordination: lighting, makeup, hair, costumes, sets, props, acting. Yet they had no time to get used to one another; everyone threw themselves straight into the work, and it fit together seamlessly. The set designer explained to me how he had painted the walls a shade just off pure white, which would set the mood of the scene. The costume designer agonized over what kind of sandals the lead should wear. They explained these things to me one by one, but never needed to explain them to each other. They had only just started working together, yet somehow made everything look exactly right."

If we think of the big, centrally run company as a computer with a CPU, memory and processing, this smooth scene looks more like a different kind of computing: something called a "cellular automaton". You don't need to understand exactly how it works. Just think of how an ant colony works, or how neurons in the brain work. Each follows only a few simple rules and responds only to what similar units next to it are doing, and together they accomplish complex tasks.

Adam Davidson's film set runs this way, and so, it seems, does Hollywood as a whole. Alwyn Hight Kushner, chairwoman of the TCL Chinese Theatre, was once an independent producer. Individual producers and theaters, she said, are exactly what make Hollywood Hollywood. "Otherwise, what would Hollywood be?"

Alwyn Hight Kushner, chairwoman of the TCL Chinese Theatre

Nobody plays the role of that powerful CPU, not even the studios. Asked about her relationship with Hollywood, Kushner gave an answer that neatly explains how this machine runs itself: "I don't think I work for Hollywood. Of course I work for myself." Nor, of course, does she work for a studio.

Look again at the steps of Hollywood's project model, "pick a project, form a team, finish the project, disband," and you can see why it can't be copied. As with the ant colony, what keeps the system running is a huge concentration of talent and support workers. People used to say that in Los Angeles you could assemble an entire film crew within a 15-minute drive. Today IMDb Pro has 200,000 registered users (Wang Jue believes this is only a small fraction of Hollywood's filmmakers), any of whom can be called on at any moment. When a project like "Deadpool" appears on the site, more than 200 people are soon working on it together.

More important, film schools turn out a steady stream of graduates. Every year The Hollywood Reporter ranks the top 25 film schools in the United States. The University of Southern California (USC), in downtown Los Angeles, has ranked first three years running. Jennifer Warren, an actress and producer who has taught at USC, says students benefit from contact with Hollywood, for instance when the school invites people like her to teach.

As for what these "similar cells" are really like, Rafeal Moreas, fresh from USC's film school master's program, put it best. "Everyone in Los Angeles wants to make movies," he said. "They may not see things the way you do, but they are just as professional as you are."

Many more people have come to Los Angeles for film. One is the Russian composer Sergei Stern we have written about before.

By now you probably won't ask that foolish question again: can Hollywood be copied in China? In ambitious China, the question comes up often (and seems to be treated as urgent). In recent years we have heard of companies hoping to copy Hollywood in China with a theme park, and of local governments hoping to turn their suburbs into Hollywood with friendlier tax breaks for the cultural and creative industries. Then there is Wanda, the most aggressive and best-funded of them all. Wang Jianlin is trying to build the world's largest film and television production base in Qingdao, the "Qingdao Oriental Movie Metropolis." The 50-billion-yuan project will partner with several film studios and has signed agreements with the world's four largest talent agencies, with the aim of bringing Hollywood stars to China to make films.

They all want to become the "engine" of a future Chinese Hollywood, or, in the metaphor we have been using, its CPU.

The trouble is that Hollywood has no CPU. It has only an ecosystem, made up of people and projects. An ecosystem is not impossible to copy, but it clearly takes much longer.

It began during the great wave of Jewish immigration to New York. A group of people from the bottom of society (ragpickers, fur workers, butchers, secondhand peddlers) discovered a tool that might earn them a living: film. They started making short films a few minutes long, gradually moving from the street to indoor sets. Film was not yet respectable as art or entertainment, but it did combine several new technologies, and companies such as Thomas Edison's General Electric and George Eastman's Kodak wanted laws that would let them collect patent fees. New York and Massachusetts had already passed such laws, and the good days of these rough-and-ready European immigrants, the first filmmakers, were over.

Nestor Studios, Hollywood's first studio

So these Jewish filmmakers fled to the far corner of the country, diagonally opposite the Northeast. Many later accounts would say California's sunshine was pleasant and better suited to filmmaking, but the real reason was simpler: the authorities were far away, and if hiding ever became impossible, Mexico was close enough to flee to.

Over the next hundred years, this place grew into Hollywood. Seen from the very top, it produced the six majors (studios) or the big four (talent agencies), which turn out films that gross more than 30 billion at the box office every year. These big companies split and merged, formed monopolies and were broken up, were bought or reorganized, and the place became the center of the world's entertainment industry. But seen more broadly, those hundred years also produced millions of film workers and countless studios and small companies, which keep thriving as they organize around thousands upon thousands of "projects." That is what makes Hollywood impossible to copy.

So what keeps these individuals, these companies, this project system, these cell-like units running? QDaily's next report will introduce them: the agents.