Invasion of the Cybermen descends on Tinseltown

A new Hollywood has beenborn and it is not in Los Angeles. Just across the bay from San Francisco, on Richmond Point, are the anonymous- looking studios of Pixar Animation, a nerdy computer-imaging company run by the founder of Apple Computer, Steve Jobs. Its first full-length film, Toy Story, just released in the US, is creating wild excitement and not just among its audiences. A more appropriate title might be Dollar Story.

This is a film that was shot entirely on location, in Richmond, yes, but more specifically in cyberspace. Distributed by Walt Disney, Toy Story is the first feature-length movie to be 100 per cent computer-generated. Its main characters are two toys, Woody, a cowboy, and Buzz Lightyear, a model space voyager - their voices are provided by the real-life stars Tom Hanks and Tim Allen - who come alive when their young owner, Andy, is not looking.

Woody and Buzz are proving to be a phenomenally successful pair. For one, they are providing Disney with a timely Christmas hit. The film climbed instantly to the top of the box office charts, taking in almost $40m (pounds 26m) in its first weekend. But it is not just Disney that is smiling. Mr Jobs has reason to be happy and so do the myriad companies that have tie-ins with the movie, ranging from toy manufacturers who were smart enough to allow their products to be included in the cast, to Grand Metropolitan, whose Burger King chain has the rights to sell Toy Story models with its Whoppers and sodas.

The high ticket sales and general hoopla have doubtless gratified Mr Jobs and his 100-strong production team - the film was four years and 800,000 computer hours in the making - but under the contract with Disney, Pixar will reportedly keep only 10 per cent of the film's profits. Much more significant for Mr Jobs was the decision to use the film's debut to fuel an initial public offering of Pixar's stock last week on the Nasdaq exchange in New York.

In the first day of trading, Pixar shares went into orbit, soaring from the offering price of $22 to $39, an increase of 77 per cent. The extraordinary performance, which drew comparisons with the recent insatiable investor demand for Netscape, the Internet software company, turned Mr Jobs, who holds 80 per cent of Pixar's outstanding shares, into a billionaire in a day. Apple made him rich, but never that rich and certainly never so quickly.

And then there is the film's merchandising boom. Grand Metropolitan's Burger King paid Disney $45m for the rights to the little Toy Story models that it is now giving away in its restaurants across America - nice for Disney but potentially even nicer for Burger King. The company reported last week that many of its outlets that thought they had stockpiled enough of the puppets and figurines to last the six weeks until Christmas were already in danger of running out, so overwhelming has been the demand.

Moreover, the film has exposed a seam of gold for the toy industry generally. Pixar struck deals with a number of established manufacturers to feature their well-known products in the movie. Sales of those toys are now taking off. One such firm is the Ohio Art company, which makes Etch A Sketch, a long-time favourite of children around the world. The company predicts that, thanks to Toy Story, it will sell at least one million more of the drawing boards this year than the 2.4 million it sold in 1994. "The film has certainly given us increased exposure," a company spokeswoman admitted.

Similar celebrations are under way at Hasbro, which loaned a whole range of its toys to the film, such as the Mr Potato Head character, Tinker Toys and Battleship. Sales of Mr Potato Head in the pre-Christmas season are expected to rise by as much as 25 per cent, the company said. Commiserations might be offered to those toy makers that declined to audition their products for the film. A part was offered to Barbie, for example, but reportedly her creators did not care for the way her character was going to be used on the screen. Such protectiveness must now look like poor business judgement.

Filled with Christmas cheer also are the retailers, particularly those specialising in toys, like the Toys R Us chain. In addition to the heightened sales of the old items that appear in the film, they report ravenous demand for the original Toy Story models, made exclusively by a Canadian toy company. There is not a child in America, it seems, who is not expecting, nay demanding, to find the Buzz-Woody duo under the tree this year. A Toys R Us spokeswoman explained: "As more and more people see the movie, more and more flock to the stores to buy the toys for their kids."

In the meantime, flesh-and-blood Hollywood is pondering what the success of Toy Story means for the movie industry's future.

Cyber-generation has been creeping into Tinseltown for more than a decade. Ten years ago, Barry Levinson's Young Sherlock Holmes introduced the first of the so-called "synthespians", a computer-generated stained-glass knight. Since then, digital trickery has been vital to the production of such hits as Jurassic Park, Forrest Gump - the amputation of Gary Sinese's legs came courtesy of chip technology - and more recently Apollo 13. Never before, though, has an entire movie sprung from processors, bits and tracing with mice.

Messrs Hanks and Allen and their peers probably need not fear that computers are going to push them off the silver screen any time soon. But they should know that the cyber-lots at Pixar Animation are already teeming with activity again. The company is under contract to provide two more feature films for Disney by the end of the decade. Its next effort is expected to be called Bugs - of insectoid rather than rabbity variety.

David Usborne