A budget of about $25 million may not be much for director Michael Bay, maker of such mega-budget movies as "Armageddon" and "Pearl Harbor."
But it's enough to get him launched on a new passion: creating a video game that matches the quality of a feature film.
Bay's first-person shooter game is part of a larger strategy to transform Digital Domain Inc., where he is now co-chairman, from one of Hollywood's elite special-effects houses into a full-blown production studio, capitalizing on the convergence between games and feature films.
That was a key inducement for Bay in leading a Florida-based investment group, Wyndcrest Holdings, last May in its $35-million purchase of the Venice company.
"I make world-class images," Bay said. "Why not put those images into a game?"
Over 13 years, Digital Domain made its name with computer wizardry that created memorable scenes for "Titanic," "The Day After Tomorrow" and "Flags of Our Fathers."
But differences among the former owners, and a lack of investment capital, hampered the company in recent years. That allowed rivals such as Sony Pictures ImageWorks, Rhythm & Hues and Peter Jackson's Weta to cut into Digital Domain's core effects business.
Compounding matters, Digital Domain and other U.S. visual-effects houses have been squeezed by rising labor costs and competition from rivals in Europe and Asia that are able to produce effects at a fraction of the cost.
Enter Bay and Wyndcrest Holdings. The partnership bought out owners that included IBM Corp., Cox Enterprises Inc. and the company founders -- director James Cameron, effects legend Stan Winston and then-Chief Executive Scott Ross.
Former veteran Microsoft Corp. executive Carl Stork, a principal of Wyndcrest, was tapped to lead the turnaround. He hired three top executives from George Lucas' Industrial Light & Magic.
"We see ourselves being the next-generation digital-content studio," Stork said. "It's like we're a new, start-up company."
Beyond fixing leaky roofs and buying ergonomic chairs for the company's 500 workers, the new owners bought a new computer network. They've also worked to improve Digital's relations with major studios, building up feature effects work that helped return the company to the black last year after a loss in 2005.
