When AI handles 80% of production, what is the 20% that retains value?

The coming AI tsunami is going to affect the animation industry in profound ways. AI tools are making it easier than ever to produce animated content, which means we’re about to witness an unprecedented flood of AI-assisted animation hitting screens of all sizes.

Sounds scary, right? But in any change, we can usually always find opportunities: Even in this deluge of AI-generated content, there is an opening for studios and creatives who know how to leverage human creativity and connection.

The coming wave of “good enough” animation

Just as we’re seeing in other creative fields, AI is rapidly reaching a point where it can generate “good enough” animation for many purposes. The tools aren’t perfect - the physics can get really wonky - but for casual viewers watching on TikTok or YouTube, the outputs are already acceptable. And the quality of outputs is only going to increase from here.

This means that one of the main barriers to entry for creating animated content is collapsing. One person with a laptop can soon produce what previously required a small team. The tools can't do everything (at least yet), but they can accelerate the bulk of the tasks needed.

If 80% is easy through AI, the remaining 20% becomes scarce (and valuable!)

This shift creates a version of the “80/20 principle” for animation in the age of AI: If 80% of animation production tasks can be handled or accelerated by AI tools (and are thus "table stakes"), then executing well on the remaining 20% becomes disproportionately more valuable and important.

What could fall into that crucial 20%? It could be things like:

• Great character design and world building - AI's have a hard time coming up with completely novel concepts and takes.
• Innovating new ways of storytelling - In the early days of cinema people just filmed stage plays - what will AI animation evolve towards?
• Add surprising/delighting details - Going an extra mile with animating background elements / characters.
• Polish what is hard for AI - For example bespoke score and sound design, etc.
• Experiment with alternate endings / choose your own adventure approaches - Even though I'm not 100% sure this will be embraced by audiences, the lines between games and animation continue to blur. It's definitely worth it to do low stakes tests around this!
• Building a fan base as early on as possible - while not part of the production process, this will help your project find an audience and bubble up to the surface - and AI can't do this for your competition.

Avoiding the race to the bottom

Much like how phone cameras made everyone a “photographer” but elevated the value of true photographic artistry, AI animation tools will simultaneously lower barriers and increase the weight of genuine creative skill.

So instead of competing with AI on cost and speed (a losing race to the bottom), one possible strategy will be to focus on the elements where human creativity and connection (at least for now) remains irreplaceable: Surprise & delight and community building.

I dare make a prediction that leveraging deep storytelling skills in order to connect emotionally with an audience is still going to be a winning strategy, even in the age of AI. Let's see how long this one will last... 😃

The strategic consequences

For animation studios a strategic reconsideration is imminent:

1. Embrace hybrid workflows - Use AI tools to handle the repeatable aspects of production, freeing up artists to focus on the differentiating creative elements.
2. Double down on originality - As derivative content becomes commoditised by AI, truly original vision becomes much more valuable.
3. Invest in building communities - No matter how original your vision, you need to find the audience for it. Hopefully that will grow over time, but you have to start with a strong core.

I’d love to hear how you are approaching this shift. What opportunities do you see in all this change? Hit reply and let me know your thoughts!

Have a great day!

- Nick

Nick Dorra

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