Digital Effects

Luring Hollywood to Cloud Computing


Making a special-effects-laden blockbuster like Harry Potter and the Deathly Hallows or an animated hit such as Disney's Tangled—the No. 1 and No. 2 movies in the U.S. last weekend—involves complex computing. Sophisticated algorithms govern the way sunlight plays on moving water or how hair moves; transferring that math into an image takes an average of six hours of computing time per frame. And the processing requirements are growing: The original Shrek, released by DreamWorks Animation SKG (DWA) in 2001, required 10 million to 15 million computing hours to complete. This year's Shrek Forever After needed 55 million hours.

Cerelink has a pitch for digital studios and special-effects companies: Rather than build, power, and maintain expensive server farms to do all that computing, outsource it. Companies in other data- or computing-intensive fields already rely on off-site servers and connect to that raw horsepower via the Internet—a setup known as cloud computing. "The visual effects industry is, at its core, a technology-centered industry," says James Ellington, Cerelink's chief executive officer. The company allows studios to "expand the production line quickly and flexibly without having to take the time to build more infrastructure," Ellington adds.

In July, DreamWorks Animation became the first studio to sign up with Cerelink. The studio is using its processors in New Mexico to handle some of the computing on the Shrek spin-off Puss in Boots and a sequel to Kung Fu Panda. The deal followed a yearlong trial during which DreamWorks put Cerelink's servers to work on hits including Shrek Forever After. "Films are requiring more and more technology to enable the visuals," says Ed Leonard, chief technology officer at DreamWorks. "The advantage of the cloud is that I don't have to build out big data centers on my campus."

While Cerelink, which is based in Corrales, N.M., is far from the power-lunch hot spots of Southern California, its location has advantages. One is cheap energy. Leonard says DreamWorks spends more than $100,000 a month powering each of its data centers in San Francisco, Marin County, and Singapore. Cerelink says it pays 9 cents per kilowatt-hour, compared with 14 cents in Los Angeles. For clients that need ultrafast computing, Cerelink also can access New Mexico's Encanto supercomputer, which can perform 172 trillion calculations a second. Because of the nearby University of New Mexico and research centers such as Los Alamos National Laboratory and the Santa Fe Institute, Cerelink can tap a highly educated labor pool to keep its servers humming.

Cerelink started as a consultancy in 2005. One of its four founders, all former Intel (INTC) executives, had worked in public relations and had extensive government contacts, which helped Cerelink win contracts advising economic development projects in places including Vietnam and Uganda. They soon realized their revenues were too dependent on their clients' ability to get project funding, and by 2008 "we were looking at different business models," says Rod Sanchez, Cerelink's co-founder and president. New Mexico had instituted a 25 percent tax credit for film and television work in 2002 as a way to entice moviemakers. After Cerelink confirmed that the credit would apply to special-effects and animation work, the company transformed into a cloud-services provider for the industry.

DreamWorks will outsource about half of its computing power next year, says Leonard. (A Hewlett-Packard (HPQ) data center in Las Vegas will get some of the business.) Not everyone in Hollywood is as comfortable with the cloud. Richard Kerris, chief technology officer at Lucasfilm, which includes digital-effects powerhouse Industrial Light & Magic, says his clients—mainly big studios such as Warner Bros. and Disney (DIS)—worry about security. "Whenever a client's content is not in our data center, there can be concerns," he says. Speed is also an issue. "We move many terabytes of data around," he says. "Sending that to a remote service will demand very high bandwidth transfer rates [that are] just not readily available and/or cost-effective."

Cerelink says its service is secure: It uses dedicated broadband lines to connect with DreamWorks animators, and it isolates the servers running DreamWorks tasks from others in its data center. And the connection is fast enough that an animator in Los Angeles can tweak the shading of a panda's fur, send the command to New Mexico for processing, and have the results register on his screen in less than 20 milliseconds—so speedy that there's no perceptible lag. Leonard says other Hollywood players will inevitably follow DreamWorks' lead. "The guys in the very high end of the business, the Disneys, the Pixars, Weta Digital, all of these guys are keenly interested in using the cloud."

The bottom line: Cerelink hopes studios and special-effects companies will outsource some of their computing needs to its New Mexico server farm.

White is a reporter for Bloomberg News in Los Angeles.

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