They go to some pretty incredible lengths too, A friend of mine and his dad own a stunt company that works explicitly with semi-trucks. Pretty much every time you see a semi in a stunt in a movie it's either my friend or his dad driving it. They will ship these semi's to foreign countries instead of film locally because the tax incentives are greater than moving entire production companies around the world.
1. City/region becomes a boom-town based on a new high profit-margin industry
2. As that region becomes more wealthy, labor increases in price, thus there is more incentive to seek labor/resources for that industry outside the city/region
3. City/region hollows out of middle-class level jobs for the industry, retains ceremonial labor and executive offices.
Considering how much they did there it wasn't nearly as inconvenient as you would think. The school had a good process in place for controlling the chaos. It's still weird watching the movie and seeing my old library in it.
Clark Hunt is the largest recipient of welfare in the entire region.
The reasoning was pretty simple: the Hunt family is worth $25 billion [0]. They could likely pay for any sort of improvements to Arrowhead, or to replace it altogether, without taxpayer funds, which comes from people in a metro area where the average income is on the lower side of things in a time when costs for everything keep going up.
On the other side of the state line, Kansas lawmakers specifically targeted the goal of moving two professional sports teams to the state using public funds called STAR bonds.
The end result is that the Kansas City metropolitan area will be spending, in total, about $3-4 billion to give the Hunt family a new place for their sports team to play, likely far away from the city center, and that Arrowhead needs to be torn down, which will cost at least tens of millions of dollars, once again, at taxpayer expense.
$3 billion could probably build out a real public transit system for the KC metro.
[0] https://sports.yahoo.com/meet-25-billion-hunt-family-2024104...
But hey sometimes people vote for their teams to stay despite the negative monetary ROI.
Post-production is very much still in California though.
Atlanta did a lot of the big ones.
Since then Canada and the UK in particular (and NZ and Australia) have had various different fluctuations in subsidies for various parts of filming / doing post-production of movies over the intervening years.
We had a boom from 2010-2022, but post streaming era the gravity has moved to the UK and Eastern Europe.
Out of the many reasons, one is quite simple: daylight. This used to be really important with film.
Historically, this was why efforts to move filming to somewhere like 'Scunthorpe, UK' didn't really work, despite tax fiddles, because you need light and some places just don't have it.
But this doesn't matter now, because film has moved on, there is no need to have a massive glowing unshielded nuclear fusion reactor, 93 million miles directly overhead, just to get some lens focused on some bits of silver halide.
Edison had a lot of early patents for film, and wanted to monopolize the industry.
Film makers in California were far enough away that it was inconvenient for Edison to sue them, both because it required sending people there in person, and because the district courts were favorable.
Because Edison and Patents in New York which was the original centre for filmmaking in America.
https://en.wikipedia.org/wiki/Motion_Picture_Patents_Company...
Everyone involved still pays their taxes, but the special purpose vehicle used to organize the production is essentially a passthrough entity.
Each movie is set up as a separate legal business entity (LLC). That's the SPV (special purpose vehicle). https://www.google.com/search?q=each+hollywood+movie+is+a+se...
There's also a separate LLC for the parent production company. The production company LLC can also send invoices to the individual movie LLC for services. People can get creative with production companies "overcharging" for various expenses back to the movie's LLC but whatever creative accounting they want to do still needs to ultimately satisfy IRS scrutiny if there's an audit. There are entertainment attorneys that specialize in movie LLCs.
The relevant taxing authorities would be concerned with the parent companies' financials, not the subsidiaries. Moving money from right hand to left hand doesn't change one's tax liabilities.
"Hollywood accounting" only refers to civil disputes due to insufficiently defined contracts between two businesses (usually actors and producers).
I spent some time last month with a relative in the industry (camera operator and producer) and he already uses some very sophisticated AI to map out scenes and shots in gen ai full video before they shoot IRL. It's mostly a cost saving exercise as well as occasionally helping to improve the quality of the deliverable.
He is totally expecting that the next shift will be that gen ai video will become good enough to be considered the master (ie no need to film) and he is already transferring his skills as a camera operator into prompting and AI assisted scene design.
He knows that many different disciplines he works with will all compete for that prompting work and there obviously won't be enough work for everybody to go around.
The first part of this is using human actors in front of 360 video stages like The Volume [0] to display the sets (which was pioneered by The Mandalorian) and then ultimately the actors themselves will be AI rendered.
And at this point it doesn't matter where this is filmed.
I grew up close by to Pinewood Studios 30+years ago - I can't imagine them putting a lot more investment and development into that lot given where this is all going.
1. Stagecraft/virtual production is a thing, yes, but the backgrounds are not "AI rendered," they're 3D scenes built in Unreal. They have to be, because they need to dynamically react to the camera moving to create parallax.
2. Yes, some people are using AI to plan scenes. With respect to your relative, those people are not the ones getting hired on large projects. When someone is hired in the film industry, they're hired for their specific taste, creative eye, and opinions. That contribution is literally their whole job. Outsourcing that task to AI is, within the industry, seen as an indication that someone is inexperienced or simply bad at their job. Crews don't want to work for those people, and audiences don't want to watch content created that way.
3. It's easy to "expect" that "one day" AI might become the way movies are captured if you don't actually understand the limitations of AI video generation versus the demands of filmmakers and the expectations of audiences. Putting aside the obvious stuff like continuity, shot duration, and resolution...GenAI is not color managed, it's not physically accurate, the results can't be copyrighted and it struggles with anything not in its training data (I.E., genuinely new ideas.)
This is NOT to say that this technology has no future in the film industry, obviously it does. But half the movies at the Oscars last year were shot on film, so the notion that all filmmaking is just going to turn into pixel soup being generated from prompts is just hilarious to everyone actually within the industry.
You're right that my relative probably isn't going to be at the top of the list to be hired for that work. He doesn't work in Hollywood level stuff and I also think that he knows he's going to have to fight to stay relevant and compete for the work that's available to him. Fortunately he's at the end of his career and his kids are adults. I think he can see the writing on the wall for his career either way.
Color management and maintaining context across multiple renders is actually the conversation we were talking about and the software that he is using has mechanisms to define context across a rendered shots and even across multiple projects. He just wasn't using them as it's an alien concept to him. My point is all of that is possible and solved and will become easier as the market matures.
I also have a friend who was significantly involved in Odyssey and I think the reason why so many films are made with film at the moment is because the industry is clinging on to what it believes is authentic when being pushed towards a commoditized race to the bottom.
As people stop paying to go to the cinema and Netflix demands tighter and tighter budgets for work, I think we will sadly see the end of this means of production because fewer and fewer people will want to pay for it.
The end goal of all of this is actually customized content where the film that I see and the film that you see is different because it's rendered to our tastes. There's a whole school of thought there around a collective experience versus an individual experience, but the technology will allow it if it's completely digitally created and one would assume that will be where it will go.
In other words, I might want Odyssey but framed as a horror filmed in noir and you might want Odyssey framed as a rom-com and the AI will just generate the version for us based on the original directors prompt. I actually think that's kind of sad, but that doesn't mean that isn't where things are going.
And when we see the edges of that control, people will be interested in seeing things that make it "the old way," part of the reason you see a lot more practical effects these days, and I would include the background-in-unreal backdrops there, because they read as more real than actors in front of a green screen—for reasons that are totally unconscious unless you are highly trained in the differences.
While I do think gen AI is going to change how movies and TV shows get made, anyone telling you it will be a whole hog replacement has not studied the history of multimedia and probably hasn't made anything that required a high-level of vision themselves.
The Odyssey was shot on IMAX cameras half the size of a car that weighed 400lbs. It's easy to call that out as being ridiculous, surely a much smaller camera system could have achieved 99% the same results, etc. but that totally misses the point. Nolan could have shot it on anything he wanted, and he chose the less convenient way, because that is his process. If he was forced to use a more reasonable camera, it would not have been a Christopher Nolan film.
Sure, I'm down with that mix of generation + animation + mocap workflow. But at some point, people will going to look around at all the equipment, the people in mocap suits, the thousands of hours of generation and the millions of dollars of compute, and just wonder...wouldn't it be easier to just film someone with a real camera?
The trend is that increasingly, the entertainment people consume comes from small-time creators. And these small creators have thus far had very little capacity to create truly visually appealing content and take on more ambitious works. And still, they've been taking mindshare from the movie industry.
Increasingly sophisticated experiences are becoming possible for these creators via AI tools. Where do you think this is going? Keep on laughing it up at your award ceremonies, but the audience is moving on.
> audiences don't want to watch content created that way.
I want to point out a couple things. Not that I'd assert that you're wrong in basically your whole post. But...
Filmed movies and normal television programs aren't competing only with other content coming from (so-called) 'Hollywood studios.' They're competing for audience attention with all content, and to be thorough with any other activity people might get up to. The potential damage to (so-called) Hollywood is equal in these two scenarios:
1. 50% of films and TV shows shift production to AI-first: They use no real shots, they just motion capture a few actors and use AI and Unreal sets built primarily with AI and put the whole thing together digitally.
2. Of the time per week that people today spend watching films and TV, people shift 50% of that time to watching cheap, often-AI-produced junk on TikTok. Or for that matter, it doesn't even need to be AI-produced junk - it could just be influencers screwing around / ranting / doing sponsored content / etc.
Either way we lost 50% of the jobs. As for whether audiences want to watch that content, I'm starting to be concerned that we (human consumers) have lost most of our control here. Most people today consume content in a few ways:
1. Algorithmic feeds show us content, one item at a time, decided by a platform owner (Meta, Google/YouTube).
2. Streaming services. Again, algorithmic. You have to scroll like 12 sections down to get to "Resume Watching" - past 11 other carousels of What Platform Owner Wants You To See
Distant third: Movie theaters, but people usually go specifically to see a certain film. What movies you even know about hinges on either a platform owner deciding to show you a video discussing a movie, or ad spend. And some people block ads, and most others try their best to skip them - this is a far cry from the 90s, when movie ads were a staple of every commercial break. I used to at least know of every film in an 8-screen theater at all times, able to give a brief synopsis of the premise, just based on the linear TV advertising I saw.
Anyway just a long-winded way to say, don't underestimate the power of platform owners to force-feed us AI garbage and artificially generate "demand" if they decide that it's in their interest to - and this is exactly their playbook due to the cost savings potential. Same reason Spotify started padding their first-party playlists with AI slop.
Remember that a lot of the people driving opinions on stuff are the artists that would be displaced by this technology.
Also... Actors aren't hired based on acting skill. AI can't replace the notoriety part of why studios hire actors.
It's a bit like people who complain that everything on the news is always bad. Everyone hates it, yet it's what everyone consumes.
Actors will still be in demand, at least leads and most speaking roles. 3000 extras, that’s going to be AI.
My hope would be this allows for hyper small budget shows to rival what takes millions today. Maybe we can actually get some creative stories instead of Marvel slop fest 43
No way. Small creatives will go elsewhere. Unless the structural "winner takes all" economy changes, small players will have no chance, especially when they have to use monopoly expensive tech.
Good writing already left hollywood, hollywood is already repetitive reboot factory.
I mean it probably can if a few famous actors license their likeness to be used in AI films. And it's probably only a matter of time until fully AI actors get marketed and licensed for use in AI films. I don't see a fundamental reason why AI actors couldn't build the same kind of notoriety and following.
Can AI's trash a room at Hotel Marmont? Dump their girlfriends when said girlfriends turn 25? Become Scientologists?
Some of us remember the story of the Luddites and hope that this time might be different with 200 years of social progress.
That's a cost problem, not a technology problem.[1]
>nobody actually cares about what they buy, which is why they will suck down all this slop
McDonald's exists?
Yes. Asian drama is already there.[1] The first AI-generated Asian vertical-format drama was released in November 2025. Now, about 400 new ones are released each day. The tools are online, and you can sign up for a few dollars a month.
Quality varies widely. The visuals are now quite good, but chatbots used to generate screenplays still have trouble holding the plot together. Much of this stuff looks like fan fiction authors are at the controls. When someone competent is driving, the results are quite good. Cost is about 10% of live action.
Hollywood probably has less than three years to live.
[1] https://pinedrama.com/blog/paradigm-shift-ai-short-drama-rev...
If every movie defaulted to CGI over natural settings, you wouldn't have stuff like the Odyssey made...which is setting sales records.
If they don't want to make a movie properly, why make it at all? The corner cutting across the board has become so bad that these movies are unwatchable.
This isn't even a new problem. A lot of traditional CGI can still be bad enough to ruin the illusion when it's the state of the art and a lot of attention to detail went into it. We've been circling the drain for decades. I suspect this is why everything became superheroes for a while. The illusion doesn't have to be good to meet that low of a bar.
If the goal is to be as cheap as possible, you might as well release the story as a picture book written by AI.
Hollywood moves have little to do with art or even entrainment for that matter. They are simply revenue generating machines. Rich people invest in a movie production and expect a return. Hollywood moves don't take artistic risks anymore which is why franchises have become such a big thing. If it make money before, it will probably make money again. Even if it's bad, fans of the last movie will buy a ticket just to see. If it's bad, well, you have their money already!
It's pretty similar to Silicon valley these days. The technology is just a vehicle to produce a return on VC money.
Also, it's not exactly that the higher effort, better quality stuff is gone as it's been drowned out by the slop. Higher quality things are still being made(e.g. The Odyssey which uses minimal CGI), just much smaller as a percentage of overall.
Earlier unit economics of slop were roughly comparable to higher effort output. It was cheaper, but not dramatically so to push out crap code, so the volume of slop was a bit lower. Now, low effort slop is genuinely low effort due to AI, so the economics work out even accounting for the lower adoption and higher complaints from the users.
Time will tell if this is a temporary phase, or the new, bleak normal.
We've had low effort fraud for all of human history. We absolutely need to revise our definition of fraud to include AI slop. People need to wake the fuck up.
Nobody would accept a low quality product under any other circumstances, so why is AI different? We only have this large scale fascination with it because so many people are completely uneducated in computer science and have no clue how it works or what the limitations are.
I’ve been in Los Angeles for over a decade, and I disagree with the premise that Hollywood has some overarching plan to shape how we think— more people watch TikToks than movies and network TV. I view Hollywood, and the creators/writers/producers of films themselves, moreso holding up a mirror reflecting the current circumstances we’re in rather than manufacturing it out of nowhere.
California as a whole is still doing pretty well but high housing cost is slowly pulling out the rug from under the state.
But the California legislature does know that and has forced many cities to start building housing but there is still a lot work still in flight.
Classic supply/demand.
Adding more Broadway (or off-Broadway) theaters to increase revenue wouldn't really address costs; the additional productions would presumably have similar staffing costs as the existing productions, so ticket prices would need to be similar in order to recoup the costs. [1] But viewers would have more options and be less likely to pay the top ticket prices.
[1] Unless you're certain that the show would fail...
Love the dig at the end.
[0] _ https://en.wikipedia.org/wiki/List_of_The_Incredibles_charac...
Ah so this might be how "shorter working hours" looks on the ground. "Leisure and Culture"'s share of the pie has actually shrunk abit:
https://archive.md/2026.06.04-075622/https://www.theguardian...
That's world, not US, so it might also be that foreign production teams are not counted as "leisure and culture" in their own jurisdictions lol
Original pdf here, p11 https://globaljusticeproject.wid.world/www-site/uploads/2026...
Interesting in relation to the article, the author describes working out of the empty Warner Bros. lot; I lived across the street, right next to "The Starlite" (the author will recognize.)
Los Angeles and the entertainment industry's economics are brutal. My wife is exponentially more successful than I, a film she was the VFX producer for won an Oscar, she's an industry player, and still LA is too expensive.
> the entertainment industry's economics are brutal
A large part of those economics are self-inflicted. The money is "loaned" to the production company at credit card rates with repayment from the receipts from theater viewing years later. Depending on how "big" the movie is, 95-100% of the box office receipts for the first 2 weeks of a theater run go back to the studio (so the movie theater survives on selling popcorn and stuff). This tapers down until the theaters get 100% of ticket sales about 2 months later. The last movie that theaters made profits from displaying was The Full Monty - it got a small release in 1997 but those theaters played the movie for months.
I worked with some guys who did special effects for movies & TV shows.
Apparently some of those profits now go to the studio too? Some of the deals being made sound borderline criminal to me.
kind of glossing over something pretty major
There's some stuff you can still do in LA but a huge amount of actual shoot days are in countries with lower costs and fewer labor restrictions.
The silver lining (for Americans) is that Hollywood movies are still very Hollywood. Canadian actors, Canadian crews, and Canadian filming facilities all combine to make utterly American films. If real locations are used, they're carefully chosen so that Vancouver stands in for New York, Calgary for Minnesota, etc.. Canadian references, accents, and values are all carefully erased.
The one thing that seems to stay stubbornly American is the money people.
1) Supply/demand. There's actually a shortage of quality movies relative to what the market will bear, one need only look at the occasional breakout hit like Obsession to see that it's possible to make a ton of money if you understand the demand signals.
2) Demand signals. Median age of someone with greenlight authority is ~62. In the 80s, there were 30-year-olds running entire studios. No disrespect to Boomers, but this business is about marketing cultural products and they have no idea about the culture. This also creates significant demographic headwinds in the job market.
3) Costs. Wages/COL are a part of it, as are unions, star power demand, and how companies like AAPL/AMZN can do streaming as a loss-leaders, which creates a lot of downward pressure. The biggest one is that in theatrical CAC > LTV. You can spend 2x your production budget on marketing and that investment evaporates the first week of showing – there's no real brand loyalty to studios/streamers, especially now that they've commoditized their IP and put it on rotation through the online platforms.
4) Originality. Franchises, sequels, and remakes were roughly three-quarters of 2025, and nine of top ten 2024 worldwide grossers were sequels. This is a result of local minima/risk arbitrage in the studio's portfolios, the bottom line is that people will still show up for a Spiderman movie even if its crappy b/c of the pre-aware IP and there's nothing better out there. There are wonderful exceptions to this of course, like Christopher Nolan and many indie films.
5) Politics. Hard to not deal with politics amidst the outrage cycle, but the easiest way to achieve that is to have a plurality of viewpoints – which you can get if you stop trying to bend beloved IP to contemporary politics and just make new shit!
And it is also actually ok to do entertainment for older people, including boomers. People act as if there was something shameful about over 40 existing and have entertainment for them. It is as ok as enrertainment for young.
Simple one light is different in NYC and Toronto.
The same thing kind of happens to industries when they get dominated by a few large players. The large players are banks. The core of the industry becomes a form of finance.
Hollywood is now the financial capital of the film industry, not where films are made. Hollywood finances films.
The "Cost disease" seemingly hasn't yet infected that industry at least (Or the infection is still in its early incubating stage) though I think that's in large part due to the fact most of the content creators aren't working within the established industry framework, but rather are intentionally trying to work outside of it, in order to avoid paying union rates.
It's really understated just how much this is behind absolutely everything today. The only reason it became normal for SV software companies to pay 100k+ salaries to interns in the 2010s is because half of that had to be handed over to a landlord every month just to have people physically able to show up to your office. This is why Europe and Asia have completely dominated production of all the great AAA games over the last decade; when creative people can afford to live somewhere, all of the sudden you have the resources to truly focus on a product.
Well, it became normal because there were people (sometimes, but not always, the same people with significant holdings in the software companies) who held a lot of real estate and knew if they wanted that real estate to be more valuable, they'd need to force people to use it, meaning show up to work every day.
SV is the failure it is today because it concentrated all of the talent in one place needlessly. Something the rest of the country explicitly worked to not see happen.
The distraction is that a lot of people think that they are property owners who are not. The bank owns your property, you're a tax farmer. The people who own the bank are your bosses. They are granted the right by the state to loan you the money to buy an overvalued property, without actually having the money to loan you, and on the condition that the property that you bought is theirs if you miss a repayment on the money that they loaned you that that they didn't have.
This is also why building more housing does not work in the long term to lower rents. We have a surplus of housing, just like we have a surplus of commercial property. But we have arbitrarily changed expectations for the margins of finance capital. The tax farmers (most landlords) are a distraction so that their tiny margins can be pointed at - because the money was made from the property when they purchased it. Now they're behind the 8-ball trying to make the payments, until they lose their job to a better tax farmer.
If you build 9000 shitty units at the site of a grocery store, you can raise all of the rents around them because the 9000 shitty units are now an escape valve against displacement and dislocation. The next step is to raise the rents on the 9000 shitty units, by any means necessary, even if it means keeping half of them empty for a decade, and using them to write off your taxes on other properties you own.
The fact that there's no grocery store and no parking for 9000 units? Your problem.
YIMBY activism is entirely financed by these people, which is why it's so loud.
People also feel secure if they have wealth, even if its assets that are illiquid. If you sell your house you have to buy another or pay rent.
You can fairly point out that unions still exist in Georgia, and that the UK and other European locations have robust worker protections - this isn’t a situation of union work vs. non-union work. But the extent to which unions in California have a stranglehold on the movie industry is absolutely part of the story here.
I have no idea how strong the unions related to film are in the UK. It varies a lot between industries.
Like with manufacturing in China, allowing your competitor countries to build up expertise means at some point it become difficult to regain top place. And whilst bulk of the profits may flow back to the USA at present, may not always be the case.
It’s not like it’s been hidden, all USA needs to do is reduce the gap so financially there is no incentive to go abroad.
Great for other countries though.
Silicon Valley stopped making computers, or any kind of manufacturing. Who knows, maybe some black projects exist.
But I was told that some underground utilities in the area were non-standard, not just water, power, sewer, but also nitrogen or more.
I noticed this in the 1990s in many movies. For instance, Independence Day - the computer animation pissed me off. I found them bad. Even Terminator 2, where evidently many people say it was great, I was nowhere near as convinced; I found the first terminator better and more "logical" and more consistent, too. But things decayed quickly in the 1990s really. Even movies such as Avatar I find total garbage. And while I am not totally against superhero comic/marvel adaptations (I liked xmen and in particular Hugh Jackman as wolverine), these are always the same formula. Tons of CGI, big fights where nobody knows what is going on, very little thought elsewhere in that formula. There are exceptions, but by and large these things keep on happening. Individual directors manage to break out of the mold (Chris Nolan) but by and large movies really SUCK now compared to the "oldschool days". And while some of this may be due to me becoming more critical, the production quality just sunk. Take movies such as Megalopolis - this captures what is going wrong. It seems as if the whole movie industry has partially collapsed in the last +25 years and they don't really know what to do to change this. The same has happened to games, by the way. It is almost as if only one formula exists only now.
Money is money, and if you can film in UK where you get tax incentives and lower costs there's no reason to film in Hollywood.
As someone not in the USA who loves movies, it is too easy to get sick of LA and desert locations everywhere.