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In the beginning, there was … ILM?

Well, that may not be literally true; the company founded by George Lucas — being honored as a “cinematic pioneer” this year by the San Francisco Intl. Film Fest — didn’t invent visual effects, and there were filmmakers in the Bay Area when Lucas arrived.

Still, according to Phil Tippett, whose Berkeley-based Tippett Studios is one of the world’s top creature shops, “Historically, (ILM) is the source of the Nile. There was nothing up here in terms of visual effects.”

The local filmmaking community has certainly changed in the 30-odd years since Lucas set up shop in Marin County in the late ’70s.

Now the Bay Area is one of the world capitals of digital filmmaking, with ILM at the Presidio, the Orphanage nearby, Skywalker Sound in Marin, Tippett Studios in Berkeley and ILM offshoot Pixar in Emeryville.

Add in DreamWorks Animation down the peninsula, boutique vfx shops Wild Brain, Evil Eye and Giant Killer Robots, among others, in San Francisco proper, and the Bay Area boasts as deep a pool of digital artists as any city in the world — with ILM and Lucas having paved the way.

Pixar producer Jim Morris, who was a longtime Lucas executive, observes: “There’s been kind of a digital production convergence up here,” with Lucas on the one hand and the proximity to Silicon Valley on the other.

“When you look at the overall installed base of digital artists,” says Morris, “it’s probably larger than Los Angeles.”

When Lucas migrated north from Hollywood, Saul Zaentz and Francis Ford Coppola were both active, and San Francisco was, remembers Tippett, “a post-production mecca. You couldn’t help but run into a sound designer just walking around on the street.”

But that business waned, and Lucasfilm and ILM became something of a lonely outpost in Marin County.

Then a funny thing happened. It spawned offspring.

In 1983, in a cash-strapped moment, Lucas sold ILM’s nascent computer-graphics unit to Apple co-founder Steve Jobs. It was renamed Pixar.

The same year, Tippett set up his own shop in Berkeley.

In the years that followed, other ILMers broke off to set up Giant Killer Robots and the Orphanage.

As ILM prexy Chrissie England explains: “ILM tends to attract top talent. Sometimes they want more challenges, so they go off and start their own companies.”

Lucas, long a booster of education at all levels, also supported the local colleges. ILM artists teach at the Academy of Art in San Francisco and the company has alumni on the faculty.

As the anchor of the area’s digital production community, Lucasfilm has been important to the local economy. Mark

Essman, executive director of the Marin County Visitor’s Bureau, says ILM’s presence in the Bay Area even helps attract filming to the region.

“They give us instant credibility. If a company that successful is in this area, they must be doing the right thing.”

Essman also notes that it’s very difficult to lure businesses to the area if they require large new construction, such as a soundstage. “A lot of the land mass is dedicated to open space, so it’s difficult to bring in what we call a ‘demand generator,’ like a new soundstage,” he says.

That’s one reason even Lucas had to think outside the box and get space in the Presidio for his new facility.

But there are places for smaller operations. “The warehouses, the large contiguous spaces, are very prevalent in the Bay Area,” Essman says. Such spaces are ideal for vfx shops.

ILM, Tippett and the rest of the Bay Area’s digital shops have learned to cooperate, as they all gain by keeping the area’s pool of artists.

“I don’t look at my fellow Bay Area vfx companies as competition,” says the Orphanage’s chief technical officer, Stu Maschwitz, “I look at them as validation that this is a good and smart place to bring your vfx work.”

For all vfx shops, work tends to be cyclical. ILM, for example, is in the midst of a push to finish “Pirates of the Caribbean: At World’s End” and “Transformers” for summer release. To make that deadline, it pulled in a lot of artists from Giant Killer Robots, which had deliberately scaled back its production schedule for the first quarter of 2007.

Michael Schmidt, one of the co-founders of GKR, says: “We do want to keep people up here, because once they leave, it’s very hard for them to come back — especially if they go to L.A., because they tend to put down roots down there.”

That’s good business for everyone, even ILM, which saves on relocation stipends when it’s doing its own recruiting.

Pixar and PDI/DreamWorks Animation are less cyclical and therefore don’t have as much back-and-forth with ILM. But a number of ILM alums are ensconced at Pixar, including Morris.

Morris considered moving to Los Angeles after leaving Lucas Digital, but he wanted to stay in Northern California, where his family has roots. He also notes the Bay Area film community has really become something separate from the L.A. movie scene.

“George was kind of the trendsetter for all that,” he says.

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