The Cutting Edge: COMPUTING / TECHNOLOGY / INNOVATION : DreamWorks SKG to Plug Into IBM : Deal: The link will give the fledgling film company access to the computer giant’s ‘digital library.’

Taking on yet another high-tech partner in its quest to become the model movie studio for the digital age, DreamWorks SKG said Tuesday it will work with International Business Machines Corp. to adapt the computer giant’s “digital library” technology to the specific needs of the entertainment industry.

The IBM system will enable DreamWorks to store and catalogue music, animation, video and other forms of entertainment on a network of powerful computers, so that they can be easily accessed by anyone at the company who needs to use them.

For example, animators--who will be the first to use the system beginning next fall--will be able to call up the frame they need to work on with greater ease. A video game producer could use the same animation to work on a different product simultaneously. And, eventually, the studio could choose to charge access to outsiders to its digital database.

“Just think what a difference it would make in our business, even if only the sound effects were stored digitally, so that any time you wanted to hear the sound of a sword going through the air or a fly being swatted on the wall, you could call it up,” DreamWorks co-founder Jeffrey Katzenberg said. “It’s a creative tool as well as an efficiency device.”

The IBM technology is already being used for other applications. For instance, all the documents in the Vatican are being indexed with it and will be made available over the Internet. But except for the workstations it sells the studio, no money will change hands between the computer firm and DreamWorks over their collaboration.

“This has to do with the relationship and the assets and what we can learn from each other,” said Rick Selvage, IBM’s manager for media and entertainment.

Several other technology companies are already waiting in line to learn from the studio formed last year by Katzenberg, Steven Spielberg and David Geffen.

Last week, Silicon Graphics Inc. said it will invest in a $50-million “digital studio” to develop tools for DreamWorks to create digital entertainment. Paul Allen, who owns several high-tech firms, has a $500-million stake in the company. And Microsoft Corp. has a joint venture with the studio to develop interactive multimedia products.

Few entertainment industry executives have been as willing to embrace the new forms of production made possible by computers as DreamWorks. And the fledgling studio is clearly benefiting from the high-tech industry’s eagerness to break into the potentially lucrative Hollywood market.

For example, IBM hopes to use DreamWorks as a test-bed from which to develop and sell products to other entertainment entities. Thus far, the world’s largest computer firm has fared notably worse than its competitors in getting Hollywood’s attention.

Director James Cameron’s digital effects company, Digital Domain, which IBM backed, uses largely Silicon Graphics workstations. And IBM’s plan to digitally deliver compact discs to retail stores owned by Blockbuster Entertainment Corp. has alienated the music industry to such a degree that the venture was scrapped earlier this year.

Katzenberg says the IBM deal will help keep DreamWorks on the cutting edge. But while the studio may be striking better deals than those who follow may be able to, it remains to be seen whether the company can balance all the conflicting interests of the technological powerhouses it has allied itself with.

“These companies have extraordinary love-hate relationships,” Katzenberg said. “But so far DreamWorks has seemed to be a place in which their complementary skills can come together to help build a new business--so far.”