Audio post houses have long groused that their position at the end of the commercial production cycle means that, even in good times, most of the ad budget is spent by the time the job gets to them.
These days, when agencies and advertisers cut budgets, many audio post houses are having to develop, or fall back on, alternative lines of business. Some of the more established houses, especially those in Southern California, have long been diversified, serving the movie and television industries, broadcast and cable networks and radio advertisers. Many newer houses are hitting the ground with a diverse client base, and some players are actively adding services to reach beyond their agency base.
"The companies with staying power have been diversified since day one," notes Jesse Meli, president of The LA Studios family of companies, which includes the audio post shops The LA Studios, Hollywood, Margarita Mix Hollywood, and Margarita Mix de Santa Monica.
Audio post houses are diversified for the obvious reasons of wanting to place their eggs into several baskets, and to avoid cyclical dips in the ad business. But agencies and advertisers, which remain the bread and butter of most audio houses, may also see some upside from that diversification. Short term, it means a healthy marketplace and longer term, it means audio houses will be able to maintain staff and facilities and be ready to serve them with emerging technologies like 5.1 surround sound when that becomes more common in the much-promised digital television era.
Tonic, New York, which opened in May 2000, not long before the ad market started to slow down, has relied on its longform television clients to help overcome the slump in spot business. "Our numbers went down too, but not as much as other places," says Peter Fish, principal/composer. "Television is a perennial sort of business. Not everything needs a post fix, but much more does than doesn’t, so you know it’s always going to be there. Whether CBS is making a lot of money or not, they’re still on the air twenty-four hours a day." (Tonic is part of the Multi-Video Group of New York-based companies which also includes Rhinoceros Visual Effects and Design, Rhinoceros Editorial, and Meccanica.)
At POP Sound, Santa Monica, managing director Bill Feil says the company’s expertise in film restoration and DVD audio carries benefits for its agency clients as well. "There are certain tools that we use for digital restoration," he says. "We’ve got the investment there and we can use those tools in our commercial sessions if there is, say, a dialogue track that had some type of problem."
Assorted Appearances
For the most part, execs at audio post houses say that diversification is a natural part of their business plan, but companies SHOOT spoke with revealed a variety of approaches. Fish contends that Tonic, with 19 employees and nine rooms, is probably the most diverse place of its kind in New York. In addition to its TV spot endeavors, it does work for such clients as PBS’s Nature, The History Channel and A&E, TV promos and show opens, independent feature films, radio spots, and corporate projects.
"We came on board with all these services," notes Fish. "We’ve always believed in diversification. This is one of the few postproduction houses run by a composer, so there is a large musical element, and we have a large sound design element. What separates us from others is the very strong sound design, music and mixing components for both long- and short-form in one company." A new area for Tonic is DVD authoring, especially for DVD packages from independent features. "We intend to be full service in the DVD realm—mixing in 5.1, as well as authoring the DVD, the finalization and creation of DVDs from a menu point of view."
Fish says 5.1 surround sound makes up about 10 percent of Tonic’s business, mostly for DVDs, but also for some spots. "Five-point-one is becoming a bigger component every day, and some for HD broadcast. We do a lot for the Nature series. I think we’ll see a lot more of it in spots next year," he says. "I hear from the clientele that they are going to do more in 2003."
He is cautiously optimistic about the current state of the TV spot business. "It’s picked up, but no one is going gangbusters," he says. Two recent jobs he cites are a Charmin campaign out of D’Arcy, New York, for which Fish also composed the music, and the current general branding campaign for NEC out of Burson-Marsteller, New York.
When POP Sound opened in ’93, Feil says, it was a digital facility from the ground up, with both a commercial and home theater department. "We’ve been diversified from the beginning," he says. "At the time, laser disks were the format, pre-DVD. We have mixers with extensive experience mixing in 5.1. We were involved early on in DVD format development, purchasing the products needed to be able to do AC3 encoding. We do a lot of longform music projects for people like Madonna, U2, Alanis Morissette, [and] Eric Clapton."
POP doesn’t usually do the mix for the music tracks, but in the case of the Eric Clapton’s Unplugged show on MTV, which was done in stereo, POP went back to the original 48-track elements to remix it in 5.1 format for DVD. When the movie Yellow Submarine was being prepared for DVD release, POP created a 5.1 mix using music remixed in 5.1 by Abbey Road Studios, London, and matched sound effects in surround sound with movement on the screen. POP also did the 5.1 mix for the Rocky DVD.
POP Sound currently has about 60 people on staff and 10 studios, including one automatic dialogue replacement (ADR) stage. So far, there isn’t much demand for 5.1 sound in TV spots, although Feil says POP has done about 20 theatrical ads in 5.1, including work for Fandango, Lexus and Toyota.
"The spot business in general is very good," he continues. "We’re about to build two more studios. Our digital infrastructure that we built when we designed POP Sound has allowed us to continue to evolve our technology. We’re in the process of firing up our audio server network and we will have a video server once we get the new studios built. We’ll be able to take a client’s picture, digitize it and be able to use it in a nonlinear working environment during the session and be able to then use that finished product off the server to create whatever the client needs."
Recent spot projects out of POP include Lee Jeans’ "Emu" and "Cheese," both directed by Dante Ariola of bicoastal/international Morton Jankel Zander; a three-spot campaign for Altoids—"Your Curious Body," "Making Friends With Fruit," and "Healthy Curiosity"—directed by Rob Pritts of Backyard Productions, Venice, Calif., out of Leo Burnett USA, Chicago; and Gatorade’s "Defining Mia," directed by Phil Joanou of bicoastal Villains; and Honda’s "Armada," also helmed by Joanou, out of Rubin Postaer and Associates, Santa Monica.
Mark Barasch, who recently joined Servi Digital Studios—a New York-headquartered video editing/ audio post facility owned by postproduction parent company Palace Production Center (PPC), South Norwalk, Conn.—reports that in addition to spots, Servi Digital is also involved in developing chip-based sounds for two large toy makers, as well as working on CD-ROM projects. "Because as technology and media develop, there are so many emerging applications for sound, and all the same rules and tools apply," he notes. "The worlds of interactive CD-ROMs, games and toys, etc., have created an opportunity to apply the same creative and technical skills to a wider range of applications than was ever previously possible." Recent spot credits out of Servi Digital include Dimetapp out of McCann-Erickson, New York; Pillsbury out of D’Arcy; Valvoline for Lowe New York; and the Breast Cancer Research Foundation via Bates Worldwide, New York.
Meli says TV spots remain the bread and butter of The LA Studios and the Margarita Mix companies, but proximity to the movie and television studios has allowed the audio shops to land a lot of longform sound business. "Diversification is geo-dependent," he says. "On the West Coast, an audio post house can typically do ADR for features and television, Foley and mixing shows as opposed to mixing spots. We have more access to the longform world. We do a tremendous amount of animation recording for feature films as well as television shows." Longform clients include Disney, DreamWorks and 20th Century Fox. The company has recorded the voice tracks for such features as Shrek, Monsters Inc. and Jimmy Neutron, but it generally doesn’t do the final mix on features. Recent spot work includes Nissan’s "Flying Saucer," directed by Gerard de Thame of bicoastal HSI Productions and Gerard de Thame Films, London, out of TBWA/Chiat/ Day, Los Angeles, and mixed at Margarita Mix de Santa Monica, as well as And 1’s "The Interrogation," directed by Chris Robinson of bicoastal/international Partizan via Fallon Minneapolis, also mixed at Margarita Mix de Santa Monica.
The companies comprising The LA Studios family have 15 rooms in three locations and about 60 employees. Meli says work in the 5.1 format has picked up recently with a number of theatrical spots, including some for European audiences, and DVD authoring. "We do a lot of DVD one-offs for special presentations and we do a lot of recording of narration tracks for added value for DVDs," he relates.
Meli also is seeing increased use of 5.1 sound in TV spots, especially in the automotive category. "The audience is beginning to grow," he explains, "and car commercials really lend themselves to take advantage of 5.1 because you can move the sound with the car." As far as the state of the spot business, Meli is reluctant to make any predictions. "What was once considered conventional wisdom is no longer wise," he says. "There is no rhyme or reason or rhythm to the business. With the actors strike, 9/11, the dot-com bust, coupled with the economy and in California runaway production, you’ve got an industry that’s been to hell and back."
Los Angeles may be the place for a diverse client base, but Howard Schwartz, owner/CEO of Howard Schwartz Recording (HSR) New York, and HSR/Silvercup, Long Island City, N.Y., says he’s been doing movies, TV shows, promos, radio recording and music recording since the shop opened in 1975. But, Schwartz says, diversification has been more in response to client needs than it has been a formal business plan. "We do audio in any format," he says. "The diversification that we’ve done has been at the request of our clients. For example, we’re into watermarking, putting a code on video or audio tracks for electronic tracking, because we’ve been requested to do it. That’s a new one. Because we are a signatory with all the unions, we’ve been asked to be the producer on any number of sessions and commercials. So we’re into talent payments and it’s starting to be a sizable business. We may set up a separate company."
HSR now has 15 rooms and about 45 employees. Schwartz says he isn’t looking for new revenue streams. TV spots make up about 40 percent of HSR’s business," Schwartz says. Recent work has included mixing spots for Coca-Cola, IBM, American Express, Jaguar and X-Box. He’s not chasing 5.1 business, although HSR has the capability, because he thinks it will be some time before real demand appears. And he doesn’t want to do DVD authoring. "We do ADR, dubbing, looping, original recording for animated features, but we’ve been doing that since 1979," he notes. "We mix sitcoms. We did Lifestyles of the Rich and Famous forever. We did The Cosby Show. We did Spin City. We do work for Court TV, Oxygen—we’re all over the place.
"Business is very good," he continues. "We’ve weathered all the storms and by virtue of our size, we’ve never had to think about cutting back any services to our clients. While business was soft, we were able to update, upgrade and expand all of our facilities and services."
Radio Days
Two companies, Sound Lounge, New York and AudioBanks, Santa Monica, are currently pursuing diversification strategies in an active way. Last month, Sound Lounge completed a $2 million expansion that includes the launching of a radio production unit headed by executive producer Gregg Singer. "We’ve done radio here before," Singer says, "but we’re taking it to the next level, which is casting, script writing, producing and original music."
Marshall Grupp, company principal/sound designer, who also heads up Sound Lounge’s Marshall Grupp Sound Design division, says that the company had been perceived as one that does only commercials. And while the techniques of mixing the tracks might not be much different in radio and television, typically the radio client needs more help. "When you mix radio, the client might come in with just a script," Grupp says, who is heading up the new radio division. "They might want the mixer to create a sound effects background. There seems to be a lot more preparation when you do TV commercials because it’s more expensive. You don’t have the luxury of coming here and not being prepared. In radio, a lot more is asked of the audio engineer."
Sound Lounge also brought in writing and sales executives to support the radio effort. Although radio is also dependent on ad spending, Grupp believes the new service will help smooth out business cycles. "We don’t want to be one-hundred percent reliant on TV. People are doing more and more radio because it’s cheaper. We feel strongly that radio is an art form that has been under-appreciated."
Grupp has also done some longform work, supervising the sound for the independent feature L.I.E., which was directed by Michael Cuesta of bicoastal/international hungry man. "One of the mixers here just finished a longform documentary they’re trying to get into Sundance," he says. "We just finished doing some audio sweetening on the MTV series Road Rules. We are kind of expanding, but our niche is getting the best commercial work in town and mixing it."
The radio expansion means adding three more rooms, for a total of eight. The staff now is up to 24. Sound Lounge is getting set up for 5.1 sound, but hasn’t done much yet, Grupp says. Spot business though has picked up in recent weeks. "We did a bunch of Mercedes-Benz spots and 7-Up spots," he says. "I just did the sound design and music for a whole bunch of commercials for the Indiana Pacers and I did a music and sound track for Hoover." Other recent credits out of Sound Lounge include Levi’s "French Dictionary," directed by Ivan Zacharias of bicoastal Smuggler and Stink, London, via Bartle Bogle Hegarty, New York; New Balance’s "Thunderstorm" and "Stairs," for which Grupp also did sound design, out of Euro RSCG MVMBS, New York, and directed by Agust Baldersson of bicoastal Headquarters; and AT&T’s "Greek," out of Young & Rubicam, New York, and helmed by Harry Patramanis of bicoastal Cohn+Company.
AudioBanks, sister company to bicoastal music and sound design house Ear to Ear, has recently begun pursuing longform work more aggressively. "We’ve done a little bit of it in the past, but we haven’t really gone after it," says Ken Cassady, COO for both companies. "Now I’ve got a sales guy who is specifically going after noncommercial work—music videos, DVD commentary, TV shows, etc. That’s where I’m trying to expand. We’re set up for 5.1, but we don’t get a lot of requests for it."
AudioBanks has done occasional noncommercial projects at the request of clients, but Cassady says the company was doing fine with TV and radio commercial work up until about the middle of ’01. "You used to be able to survive completely as a medium-size facility on nothing but commercials," he says. "As commercial work has gotten more scarce, it behooves you to diversify your client base to the point where you’re doing some ADR, some long form for TV shows, DVD commentaries, things like that."
AudioBanks opened in ’96 with two rooms, primarily to accommodate mixing needs of Ear to Ear clients. It now has six rooms and 12 employees. As a mid-sized company, AudioBanks and similar companies face diversification needs that are somewhat different from bigger houses and smaller, owner-operated facilities, Cassady says. "Big shops have corporate standing behind them and they’re usually already more diverse in their customer base," he says. "A small, owner-operated shop has a different business model. They don’t have the number of people to support in their facility. The middle-size shops seem to be a bit more susceptible to business cycles. But if you’re doing TV series, July isn’t quite so desolate."
AudioBanks’s TV spot business has been climbing back up since December, Cassady says, but slowly and not yet to the levels he would like. Recent work includes three Sony PlayStation 2 spots—"Train," "Crime Scene" and "Questioning"—directed by Doug Liman of Independent Media, Santa Monica, for TBWA/Chiat/Day, Los Angeles, with original music from Ear to Ear.
Going against the diversification movement is audioEngine, a New York audio company that opened in August. "We’re actually tightening up and focusing more on our core business, which is commercials," says Bob Giammarco, partner/mixer at the company. "One of the downfalls of the previous two companies I worked for is they were trying to do too many things. They became these big behemoths that couldn’t get out from under their own weight."
Growth isn’t a goal now, Giammarco says. "I’m more interested in keeping us performing well at our capacity as opposed to necessarily growing," he explains. "I’m more interested in keeping our four rooms as good as they can be. We have four A-list mixers. I want to see them booked all the time."
Giammarco says audioEngine won’t necessarily turn down other kinds of work, but it is not prospecting for it. "Radio doesn’t command the rate structure and you need an experienced producer, you need casting, you need writers, you need to be able to offer radio services as a complete package," he explains. "Doing a voiceover for a DVD, you’ve got to have a room where you can put three or four people together and they’ve got to be able to watch a monitor. If you’ve got the right facility, that business is realistic." Two of the company’s rooms are rated for 5.1 and it has mixers who have done 5.1, but Giammarco says it’s such a small segment of the business now, it’s not terribly attractive.
So far, "business has been great," he says. "The key to this business is talent. We’ve got great people and clients have come to us."
