I recently replied to a question from Dheeraj Gautam on the Sony Vegas group on Linked-in and I also posted it here.This was his response:
Thanks for such an informative reply Neil , much appreciated. Now I have another question. I have seen people using final cut pro for video editing, but what about Big budget Hollywood or Bollywood films? Films like Terminator, Avatar, 127 hours, are they also edited on final cut pro or are they using different software to edit like Autodesk smoke?
You're welcome Dheeraj. To answer your question I need to explain a bit of History.
Originally all films where edited by physically cutting the film and then viewing the edited sequence on a Moviola or a Steenbeck. I'm sure there are still some editors working like this somewhere.
In the early 90's non-linear editing arrived, giving the editor enormous freedom to experiment with the material and create multiple versions of sequences until they arrived at the final cut (pun intended ;-)
So you have editors using Avid, Lightworks, Final Cut Pro and other systems to edit feature films. The manufacturers were keen to promote the fact that their software was being used in Hollywood, because if it's good enough for them it must be good enough for you :-) They used to have lists of films on their websites (Here is a list of films edited on Lightworks and Final cut Pro ) but films would often appear on multiple lists. How could a film be edited on Avid and Lightworks?
The answer is that film editing is a collaborative process. The editor cutting the film may be using Lightworks but the editor putting the effects sequences together could be using Avid so the film would end up credited to both systems.
The other issue is that using non-linear systems meant eventually going back to the film negative. So all these systems needed extensive metadata management to be able to track Keycodes and timecodes and be able to assemble the final edit from the original material. See Apples digital Cinema Tools.
Now we have electronic cameras like the RED and Silicon Imaging, editing systems capable of working with the footage at full resolution and digital projection, so it is possible to shoot, edit and project the movie without having to leave the digital environment.
Sony Vegas Pro can work at resolutions of up to 4K (4096 pixels) and has been used to edit some films like Paranormal activity and Deuce of Spades. It works well with footage from DSLR cameras like the Canon 5D Mk II and 7D and the new Sony PMW-F3 and NEX-FS100U. If you are on a budget and can complete all your work in Vegas that could be one way to go.
Autodesk Smoke is a finishing system more than an editing system. It is often used for the final assembly of digitally shot films before transferring them to film, (the "Digital Intermediate" process.) It can work at up to 8K (8192 pixels) resolution and has powerful grading and compositing capabilities. If you want to assemble a 90 minute feature at uncompressed 8K you'll need quite a bit of storage :-)
In Hollywood today the software is the choice of the editor. Walter Murch famously cut The English Patient on Avid, then cut Cold Mountain on Final Cut Pro and now has apparently gone back to Avid. Thelma Schoonmaker cuts all of Martin Scorsese's movies on Lightworks. The late Sally Menke cut all of Quentin Tarantino's films on Lightworks. The Coen Brothers cut all their movies on Final Cut Pro, under the alias of Roderick Jaynes.
I suppose at the end of the day the real answer is you can use whatever you like as long as you have a workflow that works for your project. If you have the ideas and the passion to create your movie it doesn't matter which software you use.