The cost of digital equipment may be passed to fans at box offices

Major studios have agreed how digital projectors should work, meaning approved technology can now be manufactured and installed.

With digital projectors, films are screened and distributed by computer.

Oscars president Frank Pierson said it was "an important milestone in the advancement" of motion pictures.

Studios have spent the last three years working on the technology and have now settled on specifications they say are good enough for all types of movies.

It's a giant leap forward for those of us who create movies George Lucas Director

Some cinemas have already installed digital projectors, but the deal means an industry standard can be rolled out around the world.

But it is not clear whether the studios or cinema chains will foot the bill for the new equipment - and whether ticket prices will go up as a result.

It has been reported that each projector will cost $60,000-$100,000 (�34,000-�57,000).

Industry group Digital Cinema Initiatives (DCI) said the technology will become "increasingly affordable, to the point where that stumbling block should no longer be of consequence".

The cost of distributing each film will be cut by 75% because studios can send their films to cinemas by satellite, fibre optic cable or disc, instead of truck.

This now opens the door for the roll-out of digital cinema, which will revolutionise the cinematic experience for moviegoers James Cameron Director

Mr Pierson, president of the Academy of Motion Picture Arts and Sciences, which runs the Oscars, said the deal would equip the industry for the future.

"In its first hundred years, our art form made a forceful universal impression, at least partly because worldwide standards for projecting film were adopted early on," he said.

"The next hundred years are likely to be similarly affected by DCI's work in defining how digital motion pictures will be presented to world audiences."

Star Wars creator George Lucas hailed the deal as "a giant leap forward".

Hallelujah - it's about time Robert Zemeckis Director

"We have been advocates of digital cinema for nearly a decade, and this is a day we have long hoped would come," he said.

"Digital cinema will increasingly become the standard and will change the way movies are made, seen and experienced around the world."

Titanic director James Cameron said digital cinema would "revolutionise the cinematic experience for moviegoers around the world".

Forrest Gump director Robert Zemeckis added: "Hallelujah - it's about time."