Going digital, Hollywood style, usually means the eye-popping computer-generated tricks of "The Matrix" or the all-digital characters of "Dinosaur."

If you’re movie-savvy, you know that the digital alchemy is added in after Keanu Reeves has finished his part. But only if you've been reading the Hollywood trade rags are you likely to know the day is near when the entire movie-making process from sound stage to mall multiplex will be entirely digital.

This means bye-bye to the way movies have been shot, edited, duplicated and projected since the days of Charlie Chaplin and "The Great Train Robbery." Experts predict that a new digital age of movies will dawn in five to 10 years, gradually replacing Hollywood's river of celluloid with digital cameras in the studios and DVDs or even wireless satellite transmission direct to theaters.

"Digital cinema is the process of applying telecommunications technology to the celluloid process," explains Gary Garland. Garland is vice president of digital cinema systems at Qualcomm Digital Media, one of the company’s five divisions. "The entire movie-making process can be digitized end-to-end from production to exhibition, or any part of that process."

But Qualcomm's piece of the Hollywood digital revolution lies not in the flashy visual effects we associate with going digital, nor with converting a film to ones and zeroes.Instead, Qualcomm's role is behind the scenes in the distribution of finished movies to theaters and in preventing the film industry's $2 billion-a-year piracy problem.

Today, Garland says, the film industry spends some $800 million getting its films copied and from Hollywood to the local multiplex. Each print of a movie costs studios $1,200 to make, he says, and some 2,000 copies are needed for the typical Top 100 movie. Films are duplicated in Hollywood and delivered to theaters or regional clearinghouses the old-fashioned way, via air courier, UPS or other parcel delivery.

Although it’s been done this way for nearly a century, it’s a process fraught with hazards, even for heavy-hitters like Steven Spielberg. His "Saving Private Ryan" arrived late at hundreds of American and Canadian theaters for its summer 1998 premiere, disappointing thousands of fans and cutting into the film's critical opening-weekend revenue.

Another hazard, Garland says, is wrongly estimating the number of prints needed. Studios lost millions when they ordered 7,000 prints of "Godzilla," only to have the mega-lizard remake flame out after just a few weeks. Hollywood also loses out when it underestimates a film's popularity, and can’t supply additional copies in time to capitalize on the early buzz generated by an especially popular movie.

Celluloid films also degrade from the very first time they are shown. "There are actually people who won’t go see a movie after the third week it’s out because scratches and flaws are already showing up on the screen."

Digital cinema can eliminate these problems. First, a standard-length movie, whether shot digitally or on several miles of traditional film, can be compressed and stored on four to eight DVDs, at a cost of about $40 per film. And DVD copies can be made in a fraction of the time needed to duplicate numerous reels of film, just in case a movie wins wider audience acceptance than anticipated.

Qualcomm's contribution to this process is in integrating available commercial products and the company’s own know-how in data compression and encryption technology to make a digitized movie more compact, easier to store and transmit, and also more secure against piracy.

Qualcomm, of course, has competitors in data compression technology. Among them is the so-called Grand Alliance, the international consortium of consumer electronics manufacturers who cooperated to develop high-definition digital television standards.

Garland is confident, however, that Qualcomm's compression standard will prevail over the MPEG technology backed by the Grand Alliance. "Qualcomm's system is the most efficient compression algorithm," Garland says, because it can hold the most data in the smallest amount of bandwidth.

He points to Disney's recent film, "Mission to Mars." Using its own compression technology, Disney squeezed "Mission" onto 18 DVDs. By contrast, Qualcomm's system could compress the film onto only six discs.

But beyond going digital to reduce the cost of duplicating, time the unwieldiness of film canisters lies an even more profound change in how movies move from Hollywood to your neighborhood screen — satellite transmission. Enter Qualcomm again, because of its experience in efficient data compression and because of its encryption technology, which allows digital data to be converted into a virtually unbreakable code.

Transmitting movies by satellite might work something like this: a studio turns a completed movie over to a company which scans and digitizes each frame, and turns the film into a gigantic computer file. Although the process of converting an entire movie into a mega-file of some one trillion zeroes and ones might take a week or more, once it is accomplished, it can be copied in a fraction of the time it takes to duplicate the old-fashioned celluloid way.

Then the movie, now a big data file, is compressed and encrypted, then sent by satellite to a regional hub. That one hub, serving perhaps all San Diego County theaters or an even larger area, could transmit the movie — complete with the right previews of coming attractions, ads and appeals to buy more popcorn, to any number of screens in its service area.

No more air cargo, UPS trucks, spools of film, or splicing together multiple reels. No more projection booth either, as digital movies are controlled from a PC and projected by a computer-controlled system similar to projection television.

Qualcomm's Garland notes that digital cinema benefits theater operators and audiences, but most of all the studios themselves, who traditionally shoulder the duplication and distribution costs of movies. In exchange, studios typically require an 80 percent cut of the box office, leaving theater owners a 20 percent slice plus popcorn. That economic relationship holds both the promise and the pitfalls of digital cinema.

On one hand, most movie industry observers regard the conversion to digital as inevitable, both because the studios want it, and because most technical barriers have been overcome. For example, drive storage capable of handling trillion-byte files now exists. Likewise digital projection technology has reached the point where even the industry pros have been won over, after about a decade of intensive R&D by companies such as Texas Instruments and Hughes-JVC. And digital post-production and audio are virtual mainstays in most Hollywood studios. After digital screenings of "The Phantom Menace" last summer, George Lucas publicly pledged himself to digital, giving the technology a huge artistic boost.

Thus from sound stage to movie house, the digital flow is now in place. Almost.

On the other hand is that last remaining link, the one which the industry agrees will be the most difficult to forge — who will shoulder the cost of converting projection booths at individual theaters from traditional film to digital?

Gary Garland explains it like this:

"It’s an oxymoron. Theater owners make their revenue off their 20 percent (of the box office take) plus their peanuts and popcorn. How do you get theater owners to spend $100,000 per screen [for digital projection] so that the studios can save millions and millions?"

Garland offers two possible financing plans. The first would be to change the 80/20 revenue split to give theater owners who commit to digital cinema a larger share of the box office take. Owners could then use their profits to upgrade to digital. The other plan involves third parties to retrofit theaters and operate the regional hubs. These service providers — Technicolor Corp., for example — would charge the theater owners and the studios each time a digital film was screened.

"Going digital offers other benefits for exhibitors as well," says Garland. "They will save all the money and time they have to spend to have the individual movie reels spliced together with trailers, and they will also be able to provide their audiences a superior image. They will also have more flexibility in scheduling and spend less for equipment maintenance."

Satellite-receiving ability also will expand an auditorium's ability to host events besides movies, he says.

Finally, there's piracy. According to the Motion Picture Association of America, studios lose $2 billion a year to video knock-offs of their biggest hits.

Garland says the most widespread form of movie piracy occurs when someone slips a theater projectionist a few hundred dollars for an unauthorized after-hours showing. The movie is taped right off the screen with an ordinary camcorder, then the videotape is duplicated hundreds of times and sold — often in foreign markets — for just a few dollars.

Qualcomm's digital cinema plan would "watermark" each digital copy with a special code that displays the date, time and location of each showing. While watermarking won’t stop an unauthorized showing, Garland says, it will enable the movie cops to trace bootleg copies back to the specific movie house from where it was taped.

"We think knowing that you could be traced will be a pretty significant deterrent," Garland says.

— Joanne Gribble