STEVE INSKEEP, host:

If you're taking a child to the movies this week, there is a good chance that part of that movie was made in India. "The Golden Compass" and "Alvin and the Chipmunks" have digital animation done in Mumbai.

Today, NPR's Laura Sydell has the first of three stories about the way that India is becoming a big player in the global cultural marketplace.

And Laura, how much digital animation is happening in India?

LAURA SYDELL: Well, "Spider-Man 3," one of the big hits of last summer, was actually partially made in India. And Hollywood is increasingly looking to India to work on big American movies. In the next couple of years they actually say animation is going to become a billion dollar business in India.

INSKEEP: Billion dollar business, but is that cheaper than it would be to do it in the United States?

SYDELL: Yes, it is. Because the price of the salaries is a lot lower. The thing that is different is it does cost a lot more for all the connections. So they say they save enough money so they can underbid others, but it's actually not as cheap as you would think.

INSKEEP: Connections?

SYDELL: Connections, meaning Internet connections.

INSKEEP: And yet you did visit one company that's making a go of this.

SYDELL: Indeed, I visited Rhythm and Hues. And that's the company that worked on "Alvin and the Chipmunks" and "The Golden Compass," and it's based in Los Angeles. They aren't exactly subcontracting. What they do is they've opened their own office in Mumbai, and they have Indian employees and they work with them via videoconferencing. And they're a medium-sized but very successful firm that has done all kinds of work for big Hollywood movies.

(Soundbite of movie, "Charlotte's Web")

Ms. JULIA ROBERTS (Actor): (As Charlotte Cavatika) My name is Charlotte. Charlotte A. Cavatika.

Unidentified Child (Actor): (As Character) Great name.

(Soundbite of movie, "The Chronicles of Narnia: The Lion, the Witch and the Wardrobe")

Ms. TILDA SWINTON (Actor): (As White Witch) Tomorrow, we will take Narnia forever.

(Soundbite of movie, "The Cat in the Hat")

Mr. MIKE MYERS (Actor): (As The Cat) This cat should not be here. He should not be about. He should not be here when your mother is out.

SYDELL: "Charlotte's Web," "The Lion, the Witch and the Wardrobe," and "The Cat in the Hat." These are just a few of the films that Rhythm and Hues animated with a little help from the other side of the world. In a nondescript office building in Los Angeles filled with small characterless cubicles, there are only a few people left after 8:00 p.m.

The videoconference system is ready. It's time to dial up Mumbai.

Mr. JOHN PESKAVICH (Sequence Supervisor): The word of the day for DR-6 is stunning.

Unidentified Man #1: The monkey was stunning.

Mr. PESKAVICH: The monkey was stunning. Now, we have not heard that adjective applied to that monkey ever.

(Soundbite of laughter)

SYDELL: John Peskavich is a sequence supervisor on "The Golden Compass." He's watching a golden monkey move in slow motion on his computer. He looks up occasionally at the videoconference screen to check with two of his animators in Mumbai.

Mr. PESKAVICH: Does that make sense?

Unidentified Man #1: Oh, (unintelligible)

Mr. PESKAVICH: So we should end up basically with the actual...

It's tricky because you cannot sit with the individual artist, but we can look at the shots together in real time. That's how we essentially conduct it. They shoot the shots to the video recorder, then we can look at them and draw them and say this needs to be blue or move the light around here, you know, kind of thing.

Unidentified Man #1: (Unintelligible)

Yeah, put the fur on top of the wire-frame I think it would be cool.

SYDELL: In a room down the hall, another crew is deep into "Alvin and the Chipmunks."

(Soundbite of movie, "Alvin and the Chipmunks")

Mr. MATTHEW GRAY GUBLER (Actor): (As Simon) Allow us to introduce ourselves. Hello, I'm Simon, the smart one. He's Alvin.

Mr. JUSTIN LONG (Actor): (As Alvin) The optimist one.

Mr. JESSE McCARTNEY (Actor): (As Theodore) And I'm Theodore.

SYDELL: Supervisor Harry Lam here in L.A. is talking with his Mumbai crew about every detail of chipmunk eyes.

Mr. HARRY LAM (Supervisor): We spent a lot of time, probably too much time, on making the eyes look pretty, especially for this shot that we're looking at.

SYDELL: On the computer, Lam zooms in on Theodore's blue irises.

Mr. LAM: No, not just the square, the iris also.

Unidentified Man #2: Okay, the iris.

Mr. LAM: Yeah.

SYDELL: It seems so easy for them to use a videoconference system to bridge 13,000 miles. After I left the Los Angeles office, it took me two planes, over 24 hours to travel across 12 time zones and three continents to get from California to the Rhythm and Hues office in Mumbai.

Just after 8:00 in the morning, I eat breakfast with the staff. It's bread made from lentils. And a little while later I sit down and there on the videoconference screen is Harry Lam in Los Angeles.

Mr. LAM: Hello.

SYDELL: Hey, how are you?

Mr. LAM: Good. How are you?

SYDELL: Good.

They're still at work on the chipmunk eyes.

Mr. LAM: Seeing that, a lot of shots are a little too grainy.

SYDELL: The Indian offices are a far cry from Los Angeles. The cubicles have thatched roofs and rattan walls. The conference room has huge carved wooden doors.

Preshant Buyyala, managing director of Rhythm and Hues India, says this isn't supposed to be an impersonal outsourcing center.

Mr. PRESHANT BUYYALA (Managing Director, Rhythm and Hues India): India is very unique that every single state has its own unique culture and its own unique language, food and style of art as well. So we said let's actually take that and try and bring those into the office.

SYDELL: Rhythm and Hues opened its Mumbai office because it was facing increased competition from abroad, says Buyyala. Countries such as Canada and Great Britain were giving tax breaks to their own animation firms.

Mr. BUYYALA: A lot of the work that we're working on was going away to the U.K., and we were finding it very, very difficult to compete.

SYDELL: Rhythm and Hues looked at sending their work to China, South Korea, Malaysia. Buyyala, who is of Indian heritage, suggested India.

Mr. BUYYALA: An English-speaking country, so that would really help with communication for us. Cost of living was very competitive compared to the rest of the other worlds. So that was also very helpful for us.

SYDELL: And Internet speeds had gotten fast enough to move big files across the globe.

The firm also hoped to be part of a new Indian animation industry. Rahul Khanna is with Clearstone Venture Partnerships, a Silicon Valley venture capital firm that is putting its money into Indian animation.

Mr. RAHUL KHANNA (Clearstone Venture Partners): I do believe that there is an animation market emerging, and we've really haven't seen the opportunity being fully tapped as yet.

SYDELL: The animation business in India is expected to grow into a billion dollar industry in the next few years, according to Pixel, a research firm. Rhythm and Hues now has 200 employees in Mumbai and they are opening another office at Hyderabad.

Animators like Payal Danil say they are getting an opportunity to learn at Rhythm and Hues.

Ms. PAYAL DANIL (Animator): Of course the quality, which is like not found in other studios, is going to found here, and the kind of projects, the kind of work, so it's like a better exposure and a better job.

SYDELL: Danil hopes she can eventually make Indian films with the skills she got working on "Alvin and the Chipmunks."

(Soundbite of movie, "Alvin and the Chipmunks")

Mr. JASON LEE (Actor): (As Dave) Alvin.

Mr. LONG: (As Alvin) Whoa. Okay.

(Soundbite of music)

SYDELL: Today, the Rhythm and Hues crew is using the videoconference system to party together on two continents to celebrate finishing "Alvin and the Chipmunks." In Mumbai, it's chocolate cake for breakfast.

(Soundbite of laughter)

Ms. DANIL: Would you like to have a piece?

SYDELL: No, thank you.

Animator Nirmal David is actually glad to be finished with "Alvin and the Chipmunks."

Mr. NIRMAL DAVID (Animator): (Unintelligible) that sound day in and day out...

(Soundbite of chipmunk sound)

Mr. DAVID: ...gets you a little bit...

SYDELL: Among the films lined up for production next for the crew here are "The Mummy 3" and "The Incredible Hulk." Every year the number of animators here is growing, and so is there skill and the size of their contribution to American movies.

Laura Sydell, NPR News.

INSKEEP: Tomorrow we're going to continue these reports because big American movie studios like Disney and Sony are trying to break into the Indian market and having a rough time.

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