In days gone by, the only thing Hollywood film producers needed to know was whether their movies would attract crowds in the "Apple Pie" Mid-Western town of Peoria, Illinois.

From now on, globalisation and the rise of new technology mean that studio bosses will have to consider the tastes of net surfers in Singapore, know the difference between THX and Special FX and be able to spot the next "big thing".

One of the most striking trends of recent years has been the growing popularity of computer-animation and the usually insular Hollywood is looking to the computer whizkids of Silicon Valley to help it master the new techniques of digital film-making.

Into the future and beyond: Toy Story's digital star

Disney led the way, teaming up with Pixar to produce Toy Story, A Bug's Life and most recently Toy Story 2 - which has become America's second highest grossing animation of all time.

In the quest to push the boundaries of their art, the team at Pixar, one of the industry's hottest companies, are more Bill Gates than Uncle Walt.

"It takes Newton's laws of physics, differential equations and all kinds of really heavy mathematics to simulate how cloth would behave if it would be draped on a character," says Pixar's Jan Pinkava.

Style with substance

Despite an array of humming super-computers, the real challenge for Pixar and its rivals has been to fool audiences into seeing beyond their digital wizardry, thinks Total Film magazine's Cam Winstanley.

He says computer special effects in films such as Jurassic Park and Titanic have largely been used to dazzle, rather than engage cinema-goers.

Small, but beautiful: Stuart Little

This will change with the release of Stuart Little, says Winstanley. Although boasting the acting talents of Geena Davies and Hugh Laurie, the film's real star is a digital mouse.

"They've elicited a believable central performance from a non-human character. You won't go along to see it because it's a special effects film, but because you want to laugh and cry along with a computer image."

Whether Stuart Little and Disney's upcoming Dinosaurs can succeed where Star Wars' Jar Jar Binks failed, digital technology is almost certain to triumph in one area of cinema - the projection room.

Digital projection

Digital Light Processing (DLP) projectors are still rare in the UK, with Toy Story 2 being the first movie to be shown via a computer chip, rather than celluloid.

"You'll see the brightest colours and the clearest pictures ever projected on the big screen," pioneering computer animator and Toy Story creator John Lasseter promised. "It's pure eye candy."

For Mission: Impossible 2 scan the Dark Horizon

The cost of converting to DLP has hindered its adoption, but big studios are excited by the potential savings they can make.

Motion pictures could be sent to cinemas via satellite, without the cost of transferring them to film or distributing the reels. Should they wish, a studio could open a film in every cinema in the world on the same day.

The media corporations are not the only ones who would benefit from DLP. Small independent film-makers will be able to send their work - made and edited on cheap digital machines - wherever the audiences are.

Web watch

The internet has already aided film-makers of modest means. The Blair Witch Project, made for a miniscule $60,000 (�38,000) was a runaway success in cinemas worldwide thanks to a whispering campaign on the net.

Winstanley doubts such a buzz will be created again: "I think that was a one-off, but it proved the marketing potential of the web to the studios. Just look at the number of film posters which now carry a website address."

Do cinemas have a future?

Hollywood is also keeping a close eye on the countless sites by amateur directors, scanning the grainy, credit-card sized internet video for raw talent.

Despite finally embracing the web, the huge pockets of the studios have been beaten by the passion and ingenuity of hardened net heads.

Fan sites such as Dark Horizons, run by an Australian student, have become hugely popular with cinemagoers.

Admitting defeat, the trailer for John Woo's Mission: Impossible 2 was debuted on Dark Horizons even before it was "declassified" on the film's official site.

The internet "dot com" revolution is promising massive changes for film-makers.

Chaplin probably wouldn't recognise today's Hollywood

A Leeds-based firm bid �700,000 for the domain name Cinema.com, pledging to turn it into a content-rich site allowing users to buy all manner of things, including movie downloads to be viewed via their computers.

The video shop may not give up so easily, says Winstanley. He thinks films on DVD will continue to grow in popularity thanks to their picture quality.

"It will replace VHS video in 18 months. If you see a film on DVD, you'll understand why people buy them. They're phenomenal."

Wide-eyed

The cinema is also far from finished, thanks to some big plans afoot.

Large format, or so-called IMAX, cinemas are growing in popularity. Until recently only one of the huge screens existed in the UK, but within the year as many as a dozen will be open.

Large format film-maker Richard Dale, who made the BBC documentary The Human Body, says the sector is still in its pioneer period.

"It hasn't yet developed, it's like the 'pre-Chaplin' days of Hollywood. But large format films offer the best quality images in the world," he comments.

So far the films, played on vast screens which fill the audience's whole field of vision, have been "destination films" - taking viewers into space, under the sea or to the top of Everest.

Dale predicts that will change. "We're getting to grips with the grammar - the way you shoot and watch these films is very different.

IMAX: Will we get the big picture?

"The growth in audience numbers will require more sophisticated films. It will no longer be enough to just take people to places they have never been before."

Although Dale doubts we will see a 10-storey cinema on every corner, large format films may have an impact on all movies.

As screen size increases and home projectors come down in price, home IMAX may become to this century what TV and video were to the last.