PORT ST. LUCIE, Fla. - "Risky Business" was the title of a 1983 movie starring Tom Cruise and Rebecca De Mornay, but it also describes — to a T — the movie industry itself.
Nowhere is that uncertainty being felt more keenly this weekend than in Port St. Lucie after Friday's shocking announcement that Digital Domain had shut down its brand new animation studio in Tradition, instantly putting 280 people out of work.
The company defaulted on a $35 million loan in recent days, but seemed as late as Wednesday to have been successfully bailed out by its principal lenders. I wonder if the price of the lenders' "forbearance" might have been the removal of the riskiest part of Digital Domain — the Florida operation — and CEO John Textor himself.
Digital Domain looks to survive in truncated form by retreating to its core business of providing computer-generated special effects for other studios.
In an Aug. 15 conference call, Textor, key Digital Domain officers and Wall Street analysts addressed issues such as a lack of cash flow. Textor admitted there were challenges, but he bubbled over with exciting and potentially hugely profitable possibilities for the company.
Perhaps Digital Domain's demise stemmed mostly from the nature of moviemaking. The gestation period for any movie is long and fraught with difficulties and a studio brings in little or no cash flow.
That's especially true when an "outside" shop like Digital Domain produces part of a film. The firm might invest millions in staff, equipment and time to complete parts of the project, with no guarantee their work will ever see the light of day.
That's exactly what happened to "Paradise Lost," a movie Textor and company had committed to several years ago. The studio making the film decided to ditch the project before it was completed. Digital Domain took a $3.3 million hit and was forced to scour for smaller, less lucrative projects to keep going.
Meanwhile, the Port St. Lucie studio opened to concentrate on producing complete, original family-type films, not just segments of other people's movies. The payoff, Textor assured the analysts, would be potentially huge at the box office. What was left unsaid was that the payoff might be a very long time in coming.
"The Legend of Tembo," scheduled for release in 2014, was intended to blast the company into the financial stratosphere, but some inside Digital Domain acknowledged in a May 2011 story by our Alexi Howk that there were risks involved.
Veteran animator Aaron Blaise, 43, came to Digital Domain in 2010 after a 22-year career with Disney. He and longtime editor Chuck Williams saw a chance for more creative freedom.
"We just kind of took a big leap. It was a little scary, but we talked about it a lot and we realized, you know, it's gonna be high risk, but it's high reward. We had the potential to make this another Blue Sky, another Pixar, and I really think we can do it," Blaise said.
Ultimately, Textor and Digital Domain ran out of time and money. He resigned Thursday evening.
Now we're faced with the big question: Should Port St. Lucie, the county and the state have gotten themselves involved in such a risky business?
It's ironic that staid government officials apparently had stars in their eyes through all this. This newspaper's editorial board, on which I sit, wasn't immune either. We supported the Port St. Lucie project because it promised hundreds of higher-paying jobs, jobs that offered to give us a foothold in a brave new digital world. Textor seemed to check out; his track record of award-winning movies included "Transformers" and "The Curious Case of Benjamin Button."
The city will get the studio back, perhaps minus property tax revenues and Digital Domain's payments toward the building. The next bond payment is due in March and unless the city can find a new tenant before then, it will have to make the next $3.8 million installment itself.
Worst of all, almost 300 people lost their jobs. I remember sitting next to Textor at a Port St. Lucie City Council meeting last year. He proudly showed off a photo album of all the people he'd hired in Port St. Lucie. He quoted statistics about how many of those were locals and how many others had decided to live in the city.
I feel a great deal of sympathy for those individuals, some of whom I know personally. They went for their dreams, only for them to become a nightmare.
We all knew bringing Digital Domain here was risky, but we looked beyond the challenges toward a big payday of our own. The script we wrote might have read "No guts, no glory."
Perhaps "Paradise Lost" would make a good title for a movie about what went down in Port St. Lucie.