HOLLYWOOD GETS WIRED

By MICHAEL KRANTZ/LOS ANGELES

Woody Harrelson loved the interactive tour. Independence Day producer Dean Devlin was dazzled by the hot graphics. And Sean Connery made an appointment to come back for a longer visit.

On the very day that former Creative Artists Agency shogun Michael Ovitz was falling on his ears at Disney, his old outfit was literally rolling out the red carpet for a key element of its strategy to rule tomorrow's Tinseltown. Last Thursday marked the unveiling of the CAA/Intel Media Lab, CAA's bid for a thick slice of the growing PC-software pie and the strongest indicator to date that Hollywood and Silicon Valley's marriage of convenience might turn into true love after all. "We are all, like it or not, surfers on that growing [high-tech] wave," CAA president Richard Lovett told a crowd of bold-faced names like Jennifer Aniston and Michael Crichton. "Some of you in this room are already old pros...but there are many of us who are afraid of getting our feet wet."

Lovett thinks it's high time Hollywood dove on in. Geek-laden companies such as Pixar, Industrial Light & Magic and Digital Domain (effects houses for Toy Story, Jurassic Park and Terminator II, respectively) have been turning digital technology into blockbuster grosses for years. And more recently, as Websites flacking for the likes of 101 Dalmatians and ID4 score multimillion "hit counts," the studios have come to value the Internet's impressive promotional clout.

The stakes, however, are rising fast. That heady moment is approaching when home computers linked to a more TV-like Web will emerge as a lucrative entertainment medium in their own right. CAA believes that introducing its clients to the wonders of the PC revolution will help the agency make cyberspace attractive to mass audiences--and steal a march on archrivals International Creative Management and William Morris Agency in the process. "Our artists have lots of story ideas floating around in their heads," says Hassan Miah, a former management consultant who now runs CAA's new-media program. "When they see what they can do now, they'll start applying their talents."

That will be music to Andy Grove's ears. Grove, CEO of microchip colossus Intel, has a clear aim in partnering with CAA on the media lab: plant the "content community" with seed capital and hope like hell something grows. His $16 billion company is ramping up production capacity to the tune of $3.5 billion a year. But how exactly, Grove wonders, is Intel going to persuade people to drop another $3,000 each time a new, extra-ultra-powerful PC gets invented, instead of sticking with last year's merely ultra-powerful model? "You can't push 100 million-plus PCs into the marketplace," admits Ron Whittier, senior vice president of Intel's year-old Content Group. "There has to be some kind of pull."

And when you talk pull, you talk Hollywood, which has spent generations pulling the American citizenry in front of movie and television screens. But the high-tech era is bringing the industry's monopoly to a close. The amount of money American consumers spend on computer hardware and software has crept within shouting distance of what we shell out for movies and television. There are only so many hours in a day, and if stalled TV ratings, CD sales and movie grosses are any indication, the not-quite-ready-for-prime-time Web is already eroding Hollywood's vise grip on our nation's leisure dollar. Scrappy startups like American Cybercast and IFusion Com are pioneering the Web "channels" whose chat rooms, interactive dramas and unknowable innovations to come could well represent the future of home entertainment.

But if Hollywood has accepted the mortal threat the PC poses to its cultural hegemony, it's hard to tell. "Most of the most creative uses of multimedia come from startups," says Grove. "Whatever is not filled by the incumbent creates a window of opportunity for someone else, and I don't think the incumbents are paranoid enough. Years from now you may be writing stories about how Hollywood missed it."

The industry's salvation could lie with the actors, directors and writers Hollywood refers to collectively as the Talent. CAA sees its new lab as one-stop digital shopping for the glitterati: Let's educate our Talent, let them get their hands dirty, then collect our hallowed 10% on whatever cool stuff they come up with. Created over the past year with Intel and some 20 contributing technology partners at a cost Miah describes as "many millions of dollars," the place is a high-tech marvel: 2,000 sq. ft. of wired-up hardware, from PCs to digital cameras, digital videodisc players to digital satellite systems and a sound system studly enough to simulate a Who concert circa 1973--all of it linked to a handheld tablet that lets visitors control the whole Star Trek-like assemblage with a flick of an opposable thumb.

But will the stars buy in? A handful of CAA's biggest names have already dipped their toes into digital waters. Michael Keaton, for instance, is a partner in his friend Chip Walters' new-media company, Digital Alchemy, based in Pittsburgh, Pennsylvania. And don't be surprised sometime early in the next century to find closet tech head Sydney Pollack releasing some kind of interactive movie on the Web. "There are two parts to this equation," says the Oscar-winning director. "The first part is fulfilling a creative wish: if I could tell a particular story better on a computer, that's what it would take."

The second factor, of course, is one with which even the most leathery Old Hollywood hand will be eminently familiar. "What's going to make the studios take notice," Pollack says dryly, "is market share." In other words, everyone's just waiting for the Internet's first Seinfeld--that breakthrough, must-see product that exists today as just a gleam in some obscure hacker's eye. You can just imagine the ads: "Now playing at a PC near you..."

--With reporting by David S. Jackson/Los Angeles

With reporting by DAVID S. JACKSON/LOS ANGELES