The high-profile collapse in 2006 of Peter Jackson's Halo adaptation could well have dampened the ardour with which millions of dollars are spent transforming video games into blockbusters each year. Yet it seems Hollywood has not only returned to embracing video-game adaptations but is pitching them as upscale tentpoles on a scale that has not been seen since Tomb Raider and its sequel - not to mention distancing them from the critically battered adaptations with which the genre is associated, whether unfairly or not.

John Woo is spearheading a jointly conceived film and video-game project called Ninja Gold, Jerry Bruckheimer is developing a big-budget movie adaptation of Ubisoft's smash video game Prince Of Persia: The Sands Of Time and has hired Mike Newell to direct, and Mark Wahlberg has signed up for the title role in Twentieth Century Fox's action vehicle Max Payne, based on the Rockstar Games title and about to move into production (see case study, below).

Last year was a banner year for the global video-game business, with revenues up by almost 50% to $18bn. In the US, the $170m revenue for first-day sales of Microsoft's Halo 3 outstripped the film industry's biggest opening weekend in 2007, Spider-Man 3, which took three days to gross $151m. Those are the kind of numbers no one can ignore, and that the film industry is finding increasingly hard to generate theatrically.

Fierce competition from video games continues to dent cinema attendances, while even a surprise hit such as Warner Bros' Spartan epic 300 arguably capitalised on a fast-paced, game-like atmosphere for its success, as did Robert Zemeckis' motion-capture Beowulf.

"Anybody who's interested in making large and successful films has to look at video games," argues UK producer Jeremy Bolt, whose company with writer-director Paul WS Anderson, Impact Pictures, is behind the Resident Evil trilogy.

"The whole business now is about tentpole intellectual properties and Marvel Comics (titles) have pretty much been all bought up. It makes total sense that studios and big film-makers are now looking towards video games in a very serious way. It would be surprising to me if people like Jerry Bruckheimer and Steven Spielberg were not interested in video games."

Spielberg entered the video-game business with a huge fanfare in 2005, striking a pact with Electronic Arts to create three original franchises which his Amblin production outfit would have first look at adapting to film. The first has just been announced for Nintendo's Wii console, a simple build-and-destroy game; the second will be an action-adventure title.

Meanwhile, John Woo and his Lion Rock Productions partner Terence Chang have set up a film version of Ninja Gold at Fox Atomic. Renowned games developer Warren Spector originally pitched the idea to Woo's games studio Tiger Hill, but the director also liked it as a movie concept. The plot centres on South African gold stolen by the Russian mob, hijacked by the yakuza, and tracked by a Japanese-American special agent descended from ninjas. Negotiations to attach two screenwriters to Ninja Gold have been interrupted by the writer's strike.

Spector will consult on all stages of development on the film, while Woo will design at least some of the action sequences for the corresponding Ninja Gold game. Tiger Hill also released its first game last summer, Stranglehold, and Lion Rock is considering it as a potential movie. Chang sees the convergence of games and film development into one parallel process as the way both industries will gradually migrate.

"We definitely want to do more game and movie tie-ins," says Chang. "A film like Face/Off would have been a perfect game and movie tie-in but nobody thought of it back then. To develop the movie alongside the game means the plot of the movie's going to help with the game and vice versa. It saves us a lot of time and energy."

But even as powerful new games consoles such as PlayStation 3 and Xbox 360 appear, with the ability to render movie-like graphics, development costs can now reach more than $30m per game. The downside could be all this enthusiasm drives up costs for producers seeking film rights, with games companies also becoming shrewder about their titles.

"They want much more than just consulting rights. They want to do everything they can to ensure a very good portrayal of their title," says Bolt, who has noticed the shift in games companies' attitudes. "We're getting savvier about games, they're getting savvier about movies."

As most film adaptations have proved, it is hard to reach beyond the hardcore demographic of young men who revel in games, especially with the numbingly repetitive storylines that predominate. Turning good video games into bad movies is often blamed on directors who seek to translate the games too literally and, with the absence of A-list talent, budgets that leave little room to transfer fantastical virtual worlds to the big screen.

Bolt says Impact has always strived to expand the audience reach of Resident Evil, feeding upon anxieties about climate change including in last year's Extinction. "We offered this epic imagery of Las Vegas covered in sand and the promise of a survival-horror-adventure that plays into our fears. We've tried to open up the audience with universal themes," he says.

Winning over the audience

For non-gamers, any hint a film is based on a video game can be alienating. However, The Pirates Of The Caribbean trilogy - based on a Disney amusement-park ride - proved audience prejudice can be overcome on a blockbuster scale if the end product is good enough, and Bruckheimer is out to prove he can do something similar with Prince Of Persia, which aims to go into production this summer.

Besides his involvement in Persia, Bruckheimer has also optioned Oz, fabled game-maker American McGee's twisted version of L Frank Baum's The Wizard Of Oz, with an eye to a potential trilogy. He has also signed a deal with MTV to develop video games based on original concepts.

MTV Films has also joined forces with effects guru Stan Winston to bring Midway Games' action-horror property The Suffering to the big screen, while New Line is developing Microsoft and Epic Games' alien-invasion title Gears Of War; Tom Clancy's spy tale Splinter Cell, which once had Peter Berg attached as director, is still on DreamWorks' development slate.

While recent efforts have moved far beyond the stunted ambitions of early efforts such as Super Mario Bros, games adaptations still suffer from the perception they are not going to be very good. "They are still tainted, but the gaming world is so immense that it's less worrying today," says Bolt. "And good marketing can convey a message to the audience that you don't need to know the game to enjoy what this is."

Recent adaptations such as Silent Hill and Hitman have shown when films deliberately gear their marketing beyond hardcore gamers, they can reap rewards. "People are looking now and saying, 'Hey, they're making money with these films, let's try and do it ourselves," says Silent Hill producer Don Carmody. "Every decent-selling video game out there has an option on it."

Successfully transforming the medium's typically weak, or basic, narratives and two-dimensional characters onto film has not worked as successfully as comic-book adaptations. Tomb Raider and its sequel were money-spinners for Paramount, as the Resident Evil trilogy were for Sony and Constantin, but neither franchise can lay claim to the emotional resonance generated by the likes of Spider-Man and X-Men.

In a brand-crazy world, though, video games are big and getting bigger and the games industry is now capable of Hollywood-level production values. As the games industry's thinking switches to hiring first-rate writers, film-makers and actors for game spin-offs of films, it is only a matter of time before Tomb Raider's record as the most successful video game ever is broken.

Building character

The US studios are already sniffing around Assassin's Creed, BioShock and Drake's Fortune, three recent game releases with clear cinematic potential.

Production companies usually acquire a traditional option for film rights, but generally have free rein in adaptations, creating new characters games companies can only envy. Milla Jovovich's Resident Evil character was conceived by Paul WS Anderson, but has never appeared in Capcom's small-screen franchise. "It would love to feature her in the games but I'm not sure it could afford her," says Bolt.

But games companies are seeking a bigger slice of the pie and that is seen as one of the key reasons why Jackson's adaptation of Halo collapsed: Microsoft's demands for strict creative control plus 15% of the film's gross and an escalating budget eventually frightened off Fox and Universal.

"There has been a certain amount of fallout of people just snapping up the rights and then not being able to do anything with the property, or unfortunately doing something that's a piece of crap," says Carmody. "They want to be absolutely sure you're not going to screw it up."

And while producers and studios rarely, if ever, share in any increase in sales for games spurred on by the corresponding film version, expect those lines to blur with the likes of Ninja Gold.

"We have not achieved that," says Bolt, "because the game existed before us. Certainly we have contributed to the life of Resident Evil as a game and Capcom has acknowledged that. The Everest of all this is a film-game collaboration that is organic to both industries, that is released simultaneously and involves both game creators and film-makers."

Games and films by the numbers

$25bn Global film industry revenue for 2007

$18bn Video-game industry revenue for 2007 (up 43% from 2006)

160 million Number of people who play video games in the US

$140m Budget for Sony Pictures and video-game giant Square Enix's 2001 adaptation of Final Fantasy: The Spirit Within

11.6 million Number of games the child-friendly Spyro The Dragon series has sold since its launch in 1998

7 million Sales for Spider-Man: The Movie 2, the best-selling studio-licensed video game to date

4.8 million Number of copies sold by Microsoft's Halo 3 in 2007

CASE STUDY: TURNING A HIT VIDEO GAME INTO A FILM

max payne: cinematic vibe meets emotional resonance

Adapted from a video game that was itself inspired by the films of John Woo and The Matrix, shoot-em-up Max Payne is about to go into production in Toronto, directed by John Moore, whose credits include The Omen remake. Mark Wahlberg will star and Twentieth Century Fox has worldwide rights. The video game posits Max Payne as a man whose wife and daughter are murdered by junkies high on a super drug, and who decides to wage war against the New York underworld that keeps the drug on the streets.

Payne's budget is still being finalised but, according to US producer Scott Faye, who has been developing Payne as a film property since 2000, "it won't be a low-budget film". Faye's original option for the film rights enabled him to buy them outright when Max Payne changed game publishers a few years ago, surviving a handover period. From 2000 to 2003, Faye developed Payne alongside Dimension Films, before setting it up at Fox two years ago.

The screenplay that convinced Fox to fast-forward Max Payne to the front of its development queue and Wahlberg to sign on as Payne, comes from new writer Beau Thorne, who lives in Texas, far from the mean streets of New York. "Beau has done justice to the game property, but also told a compelling feature film story," says Faye, who credits Fox production executive Peter Kang for bringing Thorne and Moore on board and thereby solving Payne's longstanding deadlock.

Having just launched his new production company, Depth Entertainment, which aims to converge games and movies, Faye believes the blanket perception of video game adaptations as inferior is unfair, blaming the films rather than the games that spawned them. "You have to make a distinct cinema experience based on a universe and character base that has been established," he argues.

Although not a household name, the Max Payne gaming franchise is well respected, contains a powerful cinematic vibe and, says Faye, is sophisticated and emotionally resonant enough to reach a broad audience.

Moore's adaptation will be gritty and tactile, deploying more urban landscapes than green-screen backdrops.

"This is a story that can almost be ripped from the headlines," says Faye. "It's a world that people can recognise. It's not Gotham City, it's New York. If an audience can relate to the plight of a character, regardless of how fantastic that story might be, it goes a long way towards garnering the interest of a much broader audience than were fans of the video game. That's the chasm we need to cross."

Upcoming game-to-film projects

Alice

Inspired by Lewis Carroll's Alice In Wonderland, American McGee's warped take on the story's mythology presents heroine Alice Liddell as a girl in a coma who has to enter Wonderland to get back to reality. The film adaptation has been ensnared in development hell, but producer Scott Faye says Jon and Erich Hoeber's screenplay is compelling enough that only a bit more tinkering is required. "If Don't Look Now was an action film, that's how I'm seeing Alice."

Clock Tower

This $15m adaptation of Capcom's horror franchise, about a teenage girl roaming around a haunted lodge inhabited by the Scissorman, has also been in development for years. The rights were recently snapped up by Los Angeles-based The Mayhem Project, which is independently financing the adaptation with a view to going into production in late March/early April. Producer Tim Kwok pitches the project as a "sophisticated genre like The Others, not another teen slasher".

Ninja Gold

John Woo will direct and produce the film element of Ninja Gold, a multiformat project co-created with celebrated game creator Warren Spector. The game and film will be developed independently while retaining similar elements. "Ninja Gold will be a mid-range movie," says Woo's producing partner at Lion Rock Productions, Terence Chang. "It's not going to be ultra-expensive. Fox Atomic has a ceiling in terms of budget. The game will be expensive, though, because Spector is the top guy in the business."

Driver

"It's a little up in the air because of what happened to Roger Avary," says producer Don Carmody of the adaptation of the Atari video game, which centres on a getaway driver hired for bank heists. Avary wrote the Driver screenplay and was set to direct the film version, but had to vacate the project following his recent car crash. "We're looking for another director, honing the script and working on the budget," says Carmody. The adaptation will be set up at Focus Features' genre division Rogue Pictures pending approval on the next script draft. "It's a big action piece. The script is inventive but also very funny - it definitely takes digs at Grand Theft Auto."

Spy Hunter

The adaptation of Midway's popular franchise revolving around a secret agent and his gadget-packed supercar has burned through a string of screenwriters (including Zak Penn and Stuart Beattie). But Universal has recently revived it as a big-budget project and is negotiating with Impact Pictures to direct and produce.

Siren

Sam Raimi's Ghost House Pictures acquired the rights to the PlayStation 2 title in early 2006 and has since been developing the adaptation for Sony Pictures. Michael Gordon, whose credits include 300, has been hired to write the screenplay, working alongside Siren's game director Keiichiro Toyama. The game focuses on an American medical student searching for her missing sister in Japan, who finds herself trapped in remote mountain village inhabited by an evil force.

Castlevania

Impact Pictures and Crystal Sky Entertainment are producing this $40m adaptation of Konami's vampire game, set mostly in 15th-century Transylvania. Sylvain White, best known for Stomp The Yard, will direct, while South Africa, Eastern Europe and Canada are all being scouted for the shoot. "We are going to be very respectful to the game," says Impact's Bolt. "It will not be a traditional Dracula film."

CASE STUDY: TRANSPORTING AN ACTION FRANCHISE TO EUROPE AT SPEED

Hitman: hardcore action with style

Twentieth Century Fox acquired the adaptation rights to Eidos Interactive's popular game series in 2005 from Chuck Gordon's Daybreak Productions and Adrian Askarieh's Prime Universe, viewing it as a potential action franchise for Vin Diesel, who remains credited as executive producer. In December 2006, however, the studio switched tack, approaching Luc Besson and Pierre-Ange Le Pogam's Paris-based Europa Corp, with which it had collaborated successfully on The Transporter and its sequel, to co-develop and co-produce Hitman.

"They'd been trying for something like 18 months to put the movie in production," says Europa Corp's Pierre-Ange Le Pogam, "but they couldn't figure out how to do it. And then they had the idea to produce the movie in Europe."

Because of the time pressures (Fox wanted the project turned around in time for a November 2007 US release), Europa used Skip Woods' existing script with some minor alterations, recruiting French director Xavier Gens, scouting locations in Eastern Europe (settling on Bulgaria for the bulk of the shoot) and hiring Timothy Olyphant to star.

Taking the project beyond typical aim-and-fire video game fodder, Woods' addition of Olga Kurylenko's character Nika, who doesn't appear in the video game, turned out to be a master stroke, allowing the film-makers to beef up character development and layer more emotion into a story about a self-sufficient killing machine. "In the game he's always on his own: lonely and alone," says Le Pogam. "In our story, he gets to know Nika and takes care of her. She provided something unique in the movie, which was a big surprise for the gamers."

With a budget "under $30m", Europa Corp kicked off the 13-week shoot in March 2007 with two units shooting simultaneously, worked on the post-production over the summer and delivered the final print to Fox in October.

On the marketing side, the studio did not position the film as the movie of the game but as a hardcore action picture, targeting the young male demographic with a TV-driven campaign.

"We didn't want to shackle ourselves with this perception that video games don't make good movies," says Kieran Breen, Fox's senior vice-president of international marketing.

"We played up the stylisation to the max: the bald head, the immaculate clothes, the gleaming gun barrel. We didn't have a movie star in the film so our joker was the fact that it was so super-stylised."

While the film garnered an R rating in the US, it received less restrictive ratings elsewhere, which helped it play well overseas - in particular in Eastern Europe and Russia, where the film was largely set. With $40m in North America and $58m overseas (and Japan still to open), it has turned out to be a profitable venture for Fox.

Top 15 films based on video games
Title (US Dist)US ReleASEw'wide
dategross
1Lara Croft: Tomb Raider (Paramount)Jun 15, 2001$274.7m
2Pokemon: The First Movie (Warner Bros)Nov 10, 1999$163.6m
3Lara Croft Tomb Raider: The Cradle Of Life (Paramount)Jul 25, 2003$156.5m
4Resident Evil: Extinction (Sony Pictures)Sep 21, 2007$147.4m
5Pokemon: The Movie 2000 (Warner Bros)Jul 21, 2000$133.9m
6Resident Evil: Apocalypse (Sony Pictures)Sep 10, 2004$129.4m
7Mortal Kombat (New Line)Aug 18, 1995$122.2m
8Resident Evil (Sony Pictures)Mar 15, 2002$102.4m
9Street Fighter (Universal Pictures)Dec 23, 1994$99.4m
10Hitman (20th Fox)Nov 21, 2007$96.5m
11Silent Hill (Sony Pictures)Apr 21, 2006$97.6m
12Final Fantasy: The Spirits WithinJul 11, 2001$85.1m
(Sony Pictures)
13Pokemon 3: The Movie (Warner Bros)Apr 6, 2001$68.4m
14Doom (Universal Pictures)Oct 21, 2005$55.9m
15Mortal Kombat: Annihilation (New Line)Nov 21, 1997$51.8m
Source: Screen International
HOW THE STUDIOS ARE GETTING INTO THE GAME

Game versions of popular films are nothing new, although the games can often be poorly received if they are hastily cobbled together to meet the cinematic counterpart's release date. Activision's Spider-Man 3 in 2006 was an exception. The game surpassed expectations, and the US studios are recognising it is worth putting in the extra time and effort rather than going for the quick cash-in.

From the early days of video games, when it spun off a Jaws title for Nintendo, Universal Pictures has been cranking out tie-ins. But in the last five years, it has upped the ante, creating big-selling titles such as King Kong - which shifted over 5 million units - and even reaching back into the archives to re-imagine Brian De Palma's Scarface into a video game in partnership with Vivendi Games.

A new phase of development has also arrived with a title such as The Chronicles Of Riddick: Escape From Butcher Bay, an extension of the film rather than a straight-up video game spin-off. Inspired by a line of dialogue about Riddick's prison-break skills, Universal's digital platforms division created an entire game around the concept.

"We had likeness rights and voiceover rights," says Adam Rymer, Universal's senior vice-president of digital platforms. "We created entirely new characters nobody had ever seen in the film before."

Riddick did not live up to box-office expectations so Universal never proceeded with a mooted theatrical trilogy, but Escape From Butcher Bay allows the studio to keep a franchise alive that might otherwise have withered on the vine (the title was highly praised in the games press and shifted over a million units on Xbox).

Although Diesel did voiceover work for Escape From Butcher Bay and Al Pacino signed over likeness rights for Scarface, getting talent on side for game spin-offs is not a sure thing. "Some people are harder, some are easier," says Rymer. "We try to get those rights in the agreements wherever possible. Now that we've seen what the potential is for gaming, we work very closely with our theatrical production team, so as they're developing the scripts, we're already there meeting with the directors and producers."

Rymer has noticed a shift in attitude from film-makers, including Russian director Timur Bekmambetov who invited the digital platform team onto the Prague set of Universal's action thriller Wanted and has been deeply involved in the development of his movie's game. Wanted is also the first title where Universal is funding the game development itself before seeking a publishing partner.

"Now we're saying if there's a property we believe in, let's start developing and funding it ourselves so we can start earlier," says Rymer. "To be a next-generation movie studio, you need to be thinking about how you extend your brands successfully to all the platforms that they can be released on."