Is Cinema Preparing for An AI Takeover?

Rising tensions in the film industry have led to disgruntled fans, sharper margins and union strikes. We unpack the problematic relationship between overworked VFX artists, the Hollywood Strikes and the reality of AI in cinema.

Jul 18, 2023 | By Max Sin
Members of SAG-AFTRA and the Writers Guild of America picket outside the Warner Bros. studio lot, in Burbank. (Jay L. Clendenin/Los Angeles Times)
Photo: Jay L. Clendenin/ Los Angeles Times

Hollywood Falls

14 July 2023, Friday midnight — Hollywood shuts down for the first time in 63 years. The Screen Actors Guild – American Federation of Television and Radio Artists (SAG-AFTRA) officially issued a strike order last week against the Alliance of Motion Picture and Television Producers (AMPTP), the trade group representing studios, broadcast networks, and streaming services in labour negotiations in the US. The strike was declared just two days after SAG-AFTRA’s last three-year contract with AMPTP ended on 12 July 2023, Wednesday. 

SAG-AFTRA President Fran Drescher announces strike. Video: Youtube: @SAGAFTRA

Both SAG-AFTRA and Writers Guild of America (WAG) are striking over the defining struggles of creatives of our time: low wages, disproportionate residual payments and the lack of governance around the use of artificial intelligence (AI). The two unions together represent the vast majority of actors who have had any experience on camera and writers across all forms of media from film to video games in the US. A collective strike between the two bodies virtually halts all film production in Hollywood. SAG-AFTRA reported an overwhelming majority vote of 97.6 percent for strike authorisation amongst its members, a sharp reminder of the increasingly unbearable working conditions creatives tolerate under Hollywood’s business model of today. Both unions last held strikes simultaneously in 1960. 

The high profile debacle begets questions of how it came to be in the first place. Sceptics are justified in their doubts with some of Hollywood’s biggest names raking in tens of millions in earnings with each release. Has Hollywood really been scraping margins to the point of underpaying its workers? Or is it precisely the sheer fame of these A-list celebrities which distract from the behemoth size of the project management task which is producing a blockbuster movie? The strikes today perhaps highlight the underlying truths behind how cinema has repositioned itself in a fast-changing film economy very much against the many individual creatives who make up what constitutes film in the first place.

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London-based data analytics firm, Gower Street Analytics, calculated that global box office revenue for 2022 came in at US$26 billion, 35 percent lower than the 2017–2019 average. The numbers represent an annual loss of US$14 billion in gross revenue, marking a distinct change in the way we engage with cinema today. To lay blame on the pandemic would be to ignore the plain reality that players in the movie business have steadily been moving to cut up for themselves bigger slices of the pie. 

A closed Regal movie theater in New York. Regal and other Cineworld chains have endured months of empty theaters during the coronavirus pandemic.
Photo: Spencer Platt/ Getty Images

Critics have linked the dip in box office revenue directly to a decrease in theatrical film releases, but the irony is sore considering that more films are being produced per year than ever before. Caveat — the majority of them are going straight onto streaming platforms. 2021 was a watershed moment in film industry history when Warner Bros. declared its entire slate for the year would debut simultaneously in theatres and on their streaming platform, HBO Max. The power move was a clear challenge for the crown of subscription-based video-on-demand services, currently held by streaming giant, Netflix, which has 232 million paid subscribers globally as of 2023. 

Lounging alone and watching Netflix
Photo: Mollie Sivaram

Industry standards for box office windows have since been reset with films spending less and less time on the big screen before being shuffled onto your favourite streaming platforms. That old magical allure of flocking to the cinemas to catch the latest blockbuster while cosily packed like sardines fades against the backdrop of an excess of films dropping each month on your television all according to schedule, from the comfort of your living room. Cost-per-view is simply incomparable with the price of a single movie ticket often exceeding a single month’s subscription of your average streaming service. Yes, film was always a commodity, but it never felt cheap

The VFX Artist Squeeze

The shift in consumer preferences from cinemas to home movies has also influenced the kind of films that get funded, produced and ultimately, make money. The trend seems to lean towards intellectual property (IP) driven films with massive budgets that only their production studios can afford, such as the superhero film franchise by Marvel Studios comprising 32 films with at least 11 more in the works across the span of 15 years, grossing over US$S26 billion on its own to date.

president of Marvel Studios Kevin Feige speaks during the Marvel panel in Hall H of the convention center during Comic Con in San Diego, California, July 23, 2022. (Photo by Chris Delmas / AFP) (Photo by CHRIS DELMAS/AFP via Getty Images)CHRIS DELMAS/GETTY IMAGES
Marvel Studios President, Kevin Feige, introducing the Marvel Cinematic Universe roadmap at Comic Con, 2022. Photo: Chris Delmas/ Getty Images

This forces genres like adult dramas and romantic comedies to the backseat as iconic Bourne franchise and Saving Private Ryan star, Matt Damon himself, explains in an interview regarding cinema today:

“The DVD was a huge part of our business… and technology has made that obsolete… You could afford not to make all of your money when (your movie) played in the theatre because you knew you had the DVD coming behind the release… It would be like reopening the movie. When (the DVD) went away, it changed the type of movies that we could make… the idea of making a 100 million dollars on a story about a love affair between these two people… that’s suddenly a massive gamble in a way that it wasn’t in the 90s when they were making all those kind of movies — the kind of movies that I loved and the kind of movies that were my bread and butter.”

Matt Damon on the interview show, Hot Ones. Video: Youtube @FirstWeFeast

A superhero franchise dominated film industry has meant that visual effects (VFX) and computer generated imagery (CGI) have become the norm rather than the exception. Hollywood stars are more in demand than ever to play titular lead roles in exciting futuristic, dystopian worlds, but so is the labour of VFX companies in producing an abhorrently large amount of design work between overwhelmingly short turnover periods. The discrepancy between glamorous red carpet expectations and exhausted realities was most evinced by Ang Lee’s 2012 Life of Pi. The demands on the contracted VFX company, Rhythm & Hues, were so great that they were forced into bankruptcy just before winning an Oscar for Best Visual Effects at the 2013 Academy Awards. VFX artists are the new lowest common denominator in show business.

Life after Pi, a short film documenting the fall of Rhythm & Hues produced by its former employees. Video: Youtube @HollywoodEndingMovie

The race amongst VFX companies now to secure tenders for the biggest superhero films in Hollywood is also a race to the bottom in how much cheaper and faster they can offer their services for, leading to overworked and underpaid VFX artists. In this vein, inconsistent and even shoddy design work becomes almost inevitable, garnering viral complaints from Tiktok critics like yannisnerdverse and no_the_robot of how this year’s big-budget films like Andy Muschietti’s The Flash disappointingly pale in CGI standards when compared to films from the early 2000s like Sam Raimi’s Spiderman trilogy. 


I can’t believe this cgi looks better than stuff that came out this year #spiderman #spiderman3 #theflash #cgi #marvel

♬ original sound – Yanni

Ironically, independent films with amateur in-house VFX artists seem to be doing better as shown by the seven Academy Awards secured by 2022’s Everything Everywhere All at Once from independent art house film company, A24. The discrepancy highlights a concerning impasse regarding the progress of VFX art, albeit under economically driven labour constraints. 


The bad CGI in #theflash is just the tip of the iceberg. Poor VFX in superhero movies is all too common, and theres a reason for it. Not every movie can be Avatar, but Marvel, DC, Warner Bros, Disney, and Sony can all do something about it. They just choose not to. #vfx #vfxartist #animation #marvel #dcuniverse #batman #nicolascagesuperman #greenscreen #Inverted

♬ original sound – No The Robot

Machine vs. Man

With the film industry showing no signs of slowing down and Hollywood strikes in full swing, is it finally time for the replacement of man with machine? Detroit-based video company, Waymark, seems to think so. Waymark just released a 12-minute short film, The Frost, almost entirely made with AI in May this year and the results are chilling (no pun intended). One gets the sense that the images conveyed on screen are something of the uncanny, attempting to look normal but hiding just beneath the surface something deeply abject. Welcome to the world of image-making generative AI. 

The Frost. Video: Youtube @waymarkmarketing

“We kind of hit a point where we just stopped fighting the desire for photographic accuracy and started leaning into the weirdness that is DALL-E,” says Stephen Parker, creative director at Waymark. DALL-E is OpenAI’s image-making AI model, an expansive natural language processing system which can generate images based on text descriptions. It was created using deep learning to train a neural network to identify things by relating their images to their text descriptions, further identifying the relationships between different things themselves. Waymark produced the short film by feeding DALL-E 2 a script to generate a certain style of images. They then used another AI tool, D-ID, to add movements to these still images such as blinking eyes and moving lips, giving birth to the eerie still-yet-alive animation of The Frost

A still of a confrontation in The Frost, by Waymark and Latent Cinema.
Photo: Waymark

“We built a world out of what DALL-E was giving back to us,” says Josh Rubin, executive producer at Waymark. The Frost seems to more so puppeteer images rather than animate them, inciting in viewers a gnawing suspicion that things are not what they appear to be. The synopsis reads: “In the icy depths of Antarctica, a team sets out to investigate a strange signal, unknowingly embarking on a journey that will challenge everything they thought they knew about their past and future.” In the case of The Frost, the unsettling nature of the medium actually lends itself to the mystery behind the plot, making AI an especially befitting mode of production for this specific film. Our fears about AI in this world become visualised on the screen, giving life to the fear of the unknown in the world portrayed in the film. The Frost is an unintentional horror masterpiece in the making. 

A still of an expedition in The Frost, by Waymark and Latent Cinema.
Photo: Waymark

Waymark joins a slew of other early AI filmmaking pioneers as showcased earlier this year in an AI film festival held by New York based AI research company, Runway. Notable works include Sam Lawton’s surrealist Expanded Childhood. A three-minute slideshow of AI-edited photographs from Lawton’s family albums graced the screen, each extended beyond their print borders using DALL-E 2 to gain entry into a hidden surrealist realm outside the fringes of what was captured as real. As an ode to what can only be half-remembered, Lawton paid homage to 20th century surrealist legend, Salvador Dalí, quoting him at the start of his short film, “The difference between false memories and true ones is the same as for jewels: it is always the false ones that look the most real, the most brilliant.”

a crowded screening room during Runway's AI film festival across new york and san franciso
A good turnout for Runway’s AI Film Festival. Photo: Runway

A New Generation of Film-makers

AI may be far from generating films realistic enough to wholly take the place of what VFX artists create manually, but an argument could be made for a whole new genre of recognisably AI-made films being spawned in its wake. Further, AI is only getting smarter at an alarming rate. DALL-E 2 was released just in 2022, with other AI video-generation tools having been around for mere months. Popular programmes like Adobe Premiere Pro are already in fact using AI to automate simple tasks such as audio and colour correction. We are perhaps far deeper down the rabbit hole than we would like to admit.

Lawton finished as one of ten finalists in Runway’s AI Film Festival. Video: Youtube: @RunwayML

Back in the business side of things, Disney recently announced in its earnings call for the first quarter of the financial year of 2023 the elimination of 7000 jobs from its roster, a restructuring move that will affect 3.2 percent of its global workforce. The mass layoffs come as part of a strategy to reduce costs by more than US$5 billion despite revenue being up by 8 percent from the previous quarter. AI or not, it seems that the entertainment industry at large is moving forward with its brutal take on human resources. They want it cheaper and faster, pushing margins by pushing human limits. Is cinema preparing for an AI takeover? It seems like the answer will be clear soon enough.

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