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It's a motion picture that is interactive, but in most cases it's a video game with loads of filmed footage.

An interactive movie uses full-motion video to tell the story, it can be combined with images and photo's of course, but the base should be video/film footage.

An interactive story develops differently depending on the interaction of the audience, meaning that the viewer has to make choices in the storyline and that way the viewer chooses which videoclip will be shown.
Wrong choices will lead to a bad ending of the story, while correct choices will have the story continue until it is eventually completed.