It is of course two festivals.

There is the official, red carpeted extravagance. And then there is the unofficial gathering, the thousands of films, scripts, ideas on the back of an envelope which come to Cannes in the not improbable hope of getting made.

Surprisingly, there is quite a bit of cross-over between the two.

How else can you explain the Austin Powers star Mike Myers, the voice of Shrek, who came to support the premiere of the eponymous cartoon feature, showing here in competition.

Mike Myers: "Just a normal boy from Toronto"

Faced with the serried ranks of tuxedo-clad photographers, the official trumpet blowers and the thousands of tourists crowding round the red carpet, Myers became all amateur and shy.

"I am just a normal boy from Toronto," he told me at the post-screening Shrek party held (of course) on the lantern-lit beach.

"And seeing all the fuss and formality of Cannes has been quite overwhelming for me."

Meanwhile in a caf� on the other side of the road, potential producers Matt Archer and Dave Boyce, who have driven down from Manchester with a fistful of scripts, were talking like the hot shots they clearly feel they might become.

Splash

"Well, casting our films will be interesting," they begin.

"I mean. We know some pretty important actors. For example. I know someone who once played alongside David Schwimmer. Or opposite him."

Who knows. Who cares? They are talking like big Cannes producers and that is all.

Sir Ian McKellen: Plays Lord of the Rings' wizard Gandalf

Meanwhile the $300m (�211m) mammoth Lord of the Rings trilogy which was keen to announce its vast presence, took over an entire French chateau on a hill outside Cannes for an appropriately gargantuan bash.

Guests had to wear a special "medallion" and were warned of dire consequences if they a) turned up without it or b) lent it to anyone else.

The party boasted sets and costumes from the film itself, flown in from New Zealand, sound effects and huge sculptured orcs and trolls.

Liv Tyler: Luminous

There were soldiers with winged helmets, ghastly dwarf assassins and "real" Hobbits who danced around what looked like something from Teletubbies but was in fact a real turf-covered Hobbit house.

I ventured inside the four-foot high home and came across Sir Ian McKellen, who plays the great wizard Gandalf.

"This is the actual set, you know," said the venerable actor in booming tones. "This is where I bang my head in the film. It's pretty amazing. I spent one year in New Zealand filming. Every day. No time for anything else."

Upstairs in the chateau a luminous Liv Tyler who plays an Elf maiden was convincing everyone that she could indeed speak Elvish.

Shrek: Animated extravaganza

In the great hall, wooden horses' heads and medieval flags hung from the hammerbeam roof, while an elf-maiden perched on a carved wooden throne.

From Tyler's Elvish to the interior decorations, it all looked thoroughly convincingly Middle Earth. Until you poked the stone mantelpiece or the vast carved gorgons, that is. Which were made of specially treated polystyrene.

It's all for show, of course, but then that is Cannes at Film Festival time.

The beach: A hot-spot day and night

At the Shrek party I bump into DreamWorks exec Jeffery Katzenberg, who has spent five years on this extraordinary animated film.

Is it a kick in the teeth for his former bosses Disney?

"We think there is room for both of us there," smiles Katzenberg delightedly.

"Call it an 'ommage to Disney if you will. Did you like it? You did? Would you like some merchandising for your kids? You would? Arrange it!" he says over his shoulder to a flunky, who scurries away.

I leave Katzenberg to do the press line-up and wander out to the beach.

Outside the waves flow up onto the sand. Hundreds of little swaying lanterns light up the huge smile that is the Plage de la Croisette.

Out at sea, dozens of yachts and a cruise liner are glowing with illuminations. In response, back on land the huge white hotels shine out, spotlit against the black sky. Cannes is like one huge film set, temporary, costly but always surprising and remarkably entertaining.