HO CHI MINH CITY, Vietnam -- The giant videogame industry, which relies on armies of highly trained artists and computer programmers in Japan and the U.S., has discovered a new source of talent -- Vietnam.

Working in a hushed modern office that seems a world apart from the rest of this bustling city, 22 artists and 13 programmers work at a company called Glass Egg Digital Media, creating exquisitely detailed animated characters for some of the world's biggest game publishers.

With its low-cost structure, Glass Egg is assisting game publishers as they attempt to focus on the selection and marketing of games while outsourcing production to low-price subcontractors. For Vietnam, Glass Egg's ability to attract top-notch talent and participate in a competitive global industry suggests the country might be able to develop a high-tech industry along the lines of India's, eventually turning Ho Chi Minh into a Bangalore for the multibillion-dollar game-software business.

The Vietnamese company's budding success reflects how far outsourcing is spreading in the software industry. "We were surprised to find a supplier in Vietnam," said Thomas Schober, an executive for Infogrames Entertainment, Europe's largest game publisher. He has hired Glass Egg to provide software components for four games, including the popular "24 Hour Le Mans," which is played on Sony Corp.'s PlayStation 2.

Glass Egg also underscores how widely software-writing talent is spreading around the globe. "The programmers here are very good," said Phil Tran, Glass Egg's 38-year-old Vietnamese-American founder. "In Vietnam, the best and brightest students don't go into business; they're interested in computers because that offers a clearer career path." The computer departments in Vietnamese schools are good, helped by the country's high literacy rate, lots of donated equipment, and foreign-trained faculty members.

Digital Egg is a prime beneficiary. Mr. Tran hires top graduates from the best university-level information-technology programs. But he pays them just $50 a month during a six-month training program. Those hired full-time -- typically just two from each 10-person training class -- are paid annual salaries of less than $4,000. Comparable jobs in the U.S. would pay $70,000 to $100,000.

The game industry, which has consolidated rapidly in recent years, is looking to computer nerds in less-developed countries because making games is enormously expensive. Translating a conceptual image of an automobile into digital form for, say, a racing game can take more than a week, the reason the development of a single game can cost several million dollars. Every surface of the car -- or dragon or spaceship -- must be constructed on a computer screen by creating a complicated skeleton of lines before texture and colors are added. A programmer must then orchestrate each of the movements that the car -- or character -- will make during the game.

Glass Egg supplies such crucial components to the industry's biggest names, including Infogrames of France and Electronic Arts Inc. of Redwood City, Calif.

"Everyone assumes that we externalize production to keep costs down -- and that's true -- but quality issues are still paramount," said Infogrames' Mr. Schober, who points out that the company also has subcontractors in several other countries in Southeast Asia. Glass Egg and most of the others, he says, are making the grade. "If you want extremely cutting-edge graphics, you still have to go to Japan, the U.S. or Europe, but companies like Glass Egg are catching up."

Mr. Tran, who was born in Saigon, immigrated to the U.S. in 1975, when he was 13 years old. After graduating from the University of California at Berkeley, he moved back to Vietnam in 1995 to work for a law firm before he established a multimedia-production studio for a California company that was one of the law firm's clients. When the California firm closed down three years later, he hired the production team and raised $400,000 to start Glass Egg in 1999.

"Our challenge is convincing people in a creative industry that we're just as good as suppliers in Japan or the States," said Steve Reid, who has an M.B.A. degree from Harvard and helped Mr. Tran raise the company's initial capital, later becoming Glass Egg's chief financial officer. "We have to find companies that are willing to invest in building a relationship."

Mr. Tran strives to create a Silicon Alley-type atmosphere for his young employees, but a Vietnamese flavor is also apparent. Some employees are barefoot when they gather in the lobby to smoke, and the lights are dimmed after lunch, when almost everyone takes a nap, typically on the floor beneath their desks.