The past year and a half will no doubt be one of the darker eras in the annals of advertising history. Since 2001, powerhouse companies have closed or scaled down dramatically, agencies have laid off reams of people and a spate of mergers have occurred as the industry positioned itself for survival.

However many, like 32-year-old New York post facility The Tape House, found ways to adapt. A company with many specialized divisions, The Tape House has pulled in the reins to focus on areas of profitability.

The Tape House group of companies - which includes traditional post facility The Tape House, graphics division Black Logic, Tape House Digital Film, audio house Photomag, Tape House Toons, The Anx, and broadband and tape-to-film divisions - pared down from nearly 250 employees three years ago to a taut 130. It is also consolidating four office floors to one.

In a restructuring plan that began in January 2002, when Black Logic relocated into the main Tape House space, the company has discontinued its creative editorial services; has moved commercial division The Anx to downtown Manhattan to set up as an independent operation; and has shifted its focus toward growth areas.

The soft economy was an impetus for change, as were burdensome real estate costs and a five-year-old investment in a high def infrastructure that is only now paying dividends.

"It's easy to grow. It's harder to retract," says Tape House partner Mark Polyocan. "Once you're big you've already made a commitment, not only to space, but to the equipment filling that space. That's what kills you. With how fast technology advances, if you don't make the right decisions on equipment, you could be dead in the water in a year."

Another factor in the change, says Polyocan, is the move of smaller editorial competitors to offer more services. "It gives clients fewer reasons to go to a larger post facility. That's a market we've lost and have had to compensate for."

In its leaner and meaner form, The Tape House is going full tilt with high def, broadband delivery, DVD authoring, graphics and tape-to-film.

The company offers non-linear editing through IQ from Quantel, which conforms HD commercials and film; meets the demand for DVD reels as the move away from 3/4" becomes a reality; and has seen its tape-to-film division grow from an $80,000/year business to double that. Polyocan attributes this growth to the increase in digital filmmaking and advertisers' desire to find different venues to show spots, such as cinemas, which requires conversion.

Additionally, he sees The Anx, which caters to the downtown commercial crowd, as a growth area. "The needs of the community requires us to expand our services," he says, noting that The Anx is HD equipped, and offers transfer, editorial and sound. He expects The Anx will bring in about $4-5 million worth of business - nearly 25% of The Tape House business.

"We've downscaled, but we're offering the services we think will be profitable in the coming years," Polyocan says. "That's a part of the new economy - you do what you can for as long as you can, then you find ways to adapt."

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