Founded in October 2006, the laboratory is jointly managed by Microsoft Research Asia and the Beijing Film Academy. Research areas in the lab include digital cartooning and animation, gaming and graphics. The lab has conducted groundbreaking research in those fields, especially on animation of Chinese traditional art. A cartoon movie "Huan Xiao Man Wu" was produced with the participation of the lab, and was named as one of the Best Cartoon Movie Nominees at the China Huabiao cinematic ceremonies in Beijing in 2007. The lab helps transfer Microsoft technologies in Graphics and Computer Vision into Digital Entertainment Products.

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