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I assume it's possible to cel-shade existing games through API interception. If done properly, could this be used as a rendering optimization technique?

This means rather than doing the cel-shading on the pixel shader stage, do a few steps on the vertex side, such as reducing geometry, and lightning complexity.

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If you mod the game, then yes. Otherwise, what you're saying is equivalent to:"why don't gaming companies release games with the toon shaded version as an option for the users?" On the vertex shader side you can't reduce any geometry. What you gain is the fact that you could use less detailed textures. Toon shading means, per se, ruling out a lot of complex lighting and effects computations in the first place. – teodron Aug 27 '12 at 12:32

Cel shading must be done at the pixel shader level to look proper, same as most other lighting. If you do it in the vertex shader, the cel shading edges will be along triangle edges rather than smoothed across the model's shape.

Many existing games can likely be easily modded to use cel shading techniques, as you need to only replace some shaders and textures in many cases. Some engines may have a lot of extra passes and post processing work that will not look good with cel shading and which may be difficult to disable. However, the game will not look good at all without replacing a large segment of the game's existing assets.

Cel shading does tend to be less intense on hardware. It requires simpler texturing (and allows smaller and less textures to be used), simpler lighting (less lights, less shadows, simpler shaders), etc. Again, this is not something that can just be a toggle switch for optimization, because in order to look good it needs very different assets than a more realistic looking game.

Short version: a game is either made to be cel shaded or it isn't.

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