Building a future in preserving films' past. (Up Front).

Their eyes are fixed on the flickering black and white images, but the two Crest National Digital Media technicians sitting in the back row of the small screening room couldn't tell you much about the movie's plot.

Instead, their concentration is focused on detecting minute cracks, dirt or other blemishes on the new copy of 1948's "The Bishop's Wife." The unusual screening is the final step in a complex and often expensive process to return the Gary Grant and Loretta Young film to its pristine condition.

"You see that," Ron Stein says excitedly, gesturing at Grant's sharply focused and smirking visage. "The picture looks brand new. You'd never know it was made in the 1940s."

Stein, Crest's president, has overseen the transformation of a three-person film lab started by his parents 40 years ago into an expansive film processing, post-production and CD manufacturing business that now occupies five buildings in the heart of Hollywood. He still gets a little giddy when he sees the work performed by his film restoration team.

And why not? Besides being a film buff, preserving films and television series for sale or simply for posterity has become Stein and Crest's growth industry, amounting to one third of the company's total film lab revenues.

The 300-person company, which last year had revenues in excess of $40 million, has been riding a wave of renewed interest on the part of Hollywood's major studios to protect what in many cases are their most valuable assets -- their film libraries.

The drive to update and preserve libraries has been fueled by the emergence of distribution channels like DVD and video-on-demand -- as well as the growth of existing markets such as cable and satellite television.

Crest is among the largest of a half dozen local companies, including Triage Motion Picture Services, YCM Inc. in Burbank and Sinetech in Valencia, that have benefited from an uptick in preservation and restoration work.

Besides breathing new life into old films, much of these firms' enhancement work involves transferring newer series and films into high-definition television or digital formats.

"(Preservation) work has created some of these companies because the big film labs, Technicolor and Deluxe, it's not really their business," says Richard P. May, vice president of film preservation for Warner Bros., which has the world's largest film and television library. 'The whole industry is aware of the value of these libraries, and if you don't keep them up you have no product."

Crest, which is a full-service lab (a "boutique Technicolor," says Stein), caters to all the major studios, offering a variety of services depending on the condition of the film and the intended distribution avenue.

Whether it's preparing a high-definition print of the Brooke Shields series "Suddenly Susan" for foreign distribution or an enhanced "Singing the Rain" for theatrical re-release, most preservation and transfer work is still done on film. Crest and other labs also offer digital restoration services, but it's a time-consuming and expensive process that is used on a limited basis for patching heavily damaged portions of old films.

Instead, most film is cleaned up and transferred to newer film stock, which has a shelf life of 100 years. Depending on the work, the process costs about $8,000 to $10,000 for an hour-long television show and $20,000 for a full-length movie. A complete digital restoration could cost many times that much.

"Digital is not considered a preservation medium because we don't know how long it be before you have obsolescence with a particular format," May says.

Smell test

When Crest is tapped to make a new master print of an old film the first order of business is the smell test.

"Sometimes when you open a can of old film it smells like vinegar. You can tell by how strong the smell is how bad it is," Stein said, explaining that the odor is caused by the deterioration of the chemicals in the celluloid resulting from silver that was incompletely removed from the film in the development process.

Shrinkage is then measured and the overall condition of the film is assessed. At that point, preservationists will repair by hand broken sprockets and re-splice edits that are coming apart. A new print is made, with a chemical process serving to clean away any dirt and remove scratches that were on the original.

"With better quality, a lot of these films have new life because of the proliferation of distribution models," Stein says. "We have the ability to resurrect these assets."