Some people still edit film that way, but it is getting harder. Recently saw an article on the Guardian where an artist lamented that the last place in Great Britain to print 16mm film was closing, http://www.guardian.co.uk/artanddesign/2011/feb/22/tacita-dean-16mm-film ("Save celluloid, for art's sake"). The article explains her workflow and why a film printing facility is important for it.
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