Wednesday, September 29, 2010
With average annual wages of more than $50,000 in 2007, digital jobs in Acadiana — thanks to newcomers like South Gents Studios — are expanding at double the growth rate of the state.
By Gregg Gothreaux
In the digital age, you’re never disconnected when your smartphone is in your pocket. It’s almost unthinkable to be unable to email a client or friend from the road. With Skype and FaceTime, you can be at virtually any meeting, anywhere. As the technology we depend on for day-to-day activities evolves, digital media have had a growing impact on people and how we relate with each other.
But what are digital media? We hear the term thrown around a lot lately. While it seems to mean different things to different people, a more cohesive definition is developing now that it is all around us.
In layman’s terms, “digital media” generally refers to any electronic media that are created and displayed using computer technology. This can include digital audio, digital video and any other content you would find online, from Facebook to Bloomberg.
Although the components of digital media may still be a bit hazy, what’s very clear is that they are transforming the world around us and changing our approach to growing new business.
Louisiana officials saw the benefits in assisting digital media development in the state and passed The Digital Media Act in August 2005. The bill gives digital media developers who set up shop in Louisiana a 25-percent tax credit on qualified production expenditures and a 35-percent tax credit for payroll expenditures for Louisiana residents. There is no minimum or maximum threshold required to receive the tax credits. There are also no caps on the amount of credits a project or company can receive.
Since these incentives were implemented, the growth of digital media companies in Louisiana has soared. According to Louisiana Economic Development, there has been an average annual growth rate of 9 percent for digital media companies in Louisiana since 2001, compared to the 0.4 percent growth rate in the nation. As a result, we’ve seen this growth reflected in the Milken Institute ranking Lafayette as the 19th best metro area for five-year high-tech GDP growth in 2009.
With the success of statewide efforts to expand Louisiana’s digital media scene, the industry in Lafayette is growing. And the numbers back it up. According to the Louisiana Workforce Commission Office of Occupational Information Services, projected job growth in the motion picture and sound recording industries statewide is 15.7 percent. The same projections for Acadiana are at 31.1 percent, nearly double those for the entire state.
These jobs are significant for state and local economies as they paid an average wage of more than $50,000 in 2007. In addition these jobs are more stable and not subject to seasonality as are other segments of the entertainment industry.
Digital media roots run deep in Acadiana, making the region fertile for out-of-state transplants like Pixel Magic, a digital effects company from California that opened a second location in Lafayette last year. Following the urging of its clients to venture into stereoscopic conversion (converting 2D movies to 3D), Pixel Magic announced in April plans to hire 100 additional artists to work at its Lafayette location.
South Gents Studios, started by friends Beau Nunez and Chris Waguespack, is another example of a company growing digital media in Acadiana. The pair, along with Nunez’s younger brother Kyle, created a fantasy Wild West in their game, “The Gentleman,” set to be released on the XBOX Live Arcade later this year.
Why is there such a difference in the job growth projections? And why are companies choosing to do business in this area? People have the opportunity to change the art and business of entertainment through the technology resources available in Lafayette and Acadiana. LEDA, along with community allies such as the Lafayette Entrainment Initiative and the Louisiana Immersive Technologies Enterprise, have been tilling the land, working to cultivate a talented digital workforce.
Programs, like the recently launched business accelerator housed at LITE, are giving budding technology-intensive companies a head start in Acadiana. The accelerator will provide its members the opportunity to connect with industry veterans, mentors and coaches while growing their business to the next level using Lafayette’s technology resources. Education and mentorship components for individuals and companies looking to apply to the accelerator are being developed by the Small Business Development Center at UL Lafayette and through the Greater Lafayette Chamber of Commerce. “It’s nice to have people who are very supportive, encouraging us and helping us out,” Nunez says.
Along with the support network available in Acadiana, Nunez and his partners chose to set up shop in Lafayette due to all of the resources and incentives available to growing companies like South Gents. “[Lafayette] offers so much; the tax incentives are great,” Nunez says. “Especially for us since [we’re] spending every extra dollar we have putting this out there.”
Nunez adds that all the resources he needs can be found right here in Lafayette, so there is no need for anyone to take their talent elsewhere. “All the tools and resources I need are right here. … Obviously there’s no better spot right now for doing what I’m doing,” he notes. “If I can’t do it here, I’m not going to do it.”
Not only are these businesses creating entertainment from scratch; they are creating jobs, which in turn create more wealth and dollars for the community.
The potential for huge profit margins is what continues to attract businesses to the industry. According to a recent report by the Entertainment Software Association, revenues in the entertainment software industry have increased at an average annual rate of 12.5 percent since 1996. This is greatly outpacing the growth rate of the national economy.
According to louisianaentertainment.gov, the production of a single video game can create 35 jobs in a small company and up to 250 jobs in a large company, with a production cycle typically between three and five years.
Nunez says the reason he continues to design video games is because “it’s creating everything from scratch. It’s giving it life.” And while Nunez is giving life to his characters, the business of digital media is bringing new blood to the business community of Acadiana.
Gregg Gothreaux is president and chief executive officer of the Lafayette Economic Development Authority. To comment on this column, e-mail