In the entertainment industry, the name WetaFX is synonymous with high-end visual effects. CEO Prem Akkaraju wants to make the firm, founded by filmmakers Peter Jackson and Fran Walsh, a marquee name for original content as well.
As he explains on the latest episode of Variety podcast “Strictly Business,” Akkaraju has helped reorganize the company’s operations to facilitate growth in content production, marking the next evolution of the New Zealand-based VFX company that at present employs about 2,000 people.
“We’re a household name in the households that make movies,” Akkaraju said. “We felt like we had a lot more to offer the world.”
WetaFX is deep in development on a handful of original movies, and plans for series are also part of the blueprint, Akkaraju said. At the same time, WetaFX intends to maintain its prominence in the competitive VFX arena. The demand for WetaFX’s core services is a good gauge of the marketplace, and demand is simply off the charts, Akkaraju said.
“The team has grown almost two times [larger] since I’ve joined, and we’ve grown revenue 35% to 40%,” he said. “There is just an amazing amount of content production. There’s two things that are happening: We have way more bids [for VFX services] and the turnaround times are shrinking.”
Akkaraju’s first major move to reshape Weta for the future was to orchestrate a deal to sell its portfolio of proprietary production software and other filmmaking tools to San Francisco-based software distributor Unity for $1.6 billion. He explains the business-case rationale behind the decision to divest the Weta Digital division in order to put it in the best position for long-term success.
“While we’re the best company in the world that ships movies, we’re not the greatest company to ship software,” Akkaraju said. Akkaraju and his partner, WetaFX vice chairman Sean Parker, was familiar with Unity from their travels as digital entrepreneurs. “They essentially provide tools to empower game makers to make games,” he said. “And they were the perfect partner to then take our filmmaking tools out there to empower new filmmakers and television producers.”
The conversation also turns to Akkaraju’s experience a half-dozen years ago when he and Parker courted Hollywood players to get behind a disruptive venture dubbed the Screening Room. It grabbed a lot of attention and support from such notables as Weta’s Jackson, Steven Spielberg and J.J. Abrams, but the stars did not align for them in 2016.
As Akkaraju explains, “It was a model that was much like how Uber makes any car into a taxi, or Airbnb makes any home into a hotel room — we used our software and hardware to turn any living room into an AMC or into a Regal and share the economics with the exhibitor.”
The Screening Room venture was doomed by their inability to bring the key constituencies — the studios, the creative community and the exhibitors — into harmony around a disruptive new idea. Akkaraju watched with interest as the boundaries of home entertainment grew by leaps and bounds over the past two years.
“Little did we know that a looming global pandemic was right around the corner,” Akkaraju said. “That basically greatly accelerated it to the point to where the studios did it on their own.”
“Strictly Business” is Variety’s weekly podcast featuring conversations with industry leaders about the business of media and entertainment. New episodes debut every Wednesday and can be downloaded on iTunes, Spotify, Google Play, Stitcher and SoundCloud.