Category Archives: Digital Cinema

How the Gates Family Foundation Saved Small Town Cinemas from Death-by-Digital

Fox Theatre Walsenburg

As the clock ticks down for the end of 35mm film prints, so the race is on to save the last few small town cinemas that cannot afford the switch to digital. We are now talking months, not years.

In the United States funds typically come from one or a mixture of three sources, all of which we have profiled here at Celluloid Junkie in the past: local community fund-raising, on-line crowd funding and even grants or donations from the local Chambers of Commerce. There was even an effort to tap the Pepsi Refresh Project a few years back, while Honda did something similar for drive-ins.

But philanthropic foundations have had a relatively low profile until a recent effort got underway in Colorado. While charities alone cannot save all the small cinemas across the US, the experience in the Centennial State shows that they can provide critical seed funding. Over the next 12 to 24 months, this can mean the difference between life and death for thousands of small town cinemas across the United States.

Colorado’s Rural Theater Digital Conversion Grant

The key to the success of Colorado’s venture has been the bringing together of three critical actors: State authorities,  non-profit bodies and private charities. As outlines last year in The Denver Post:

A number of foundations, the Colorado Office of Economic Development and International Trade, and the Denver Film Society have teamed up to create grants ranging from $10,000 to $30,000 for theaters converting to the new digital equipment required by the film industry.

Film distributors, which no longer distribute traditional celluloid prints, have converted to digital format. The new distribution method requires digital projectors, which cost an average of $60,000 to $70,000 each.

The state said many rural theaters can’t afford these projectors and will probably close, threatening the arts, culture and fabric of the community.

The last sentence has been crucial in mobilising government, business and philanthropic support, as we will see.

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Latin American VPF Deals Hide Regional Problems – UPDATED

Butch Cassidy and Sundance Kid

[Ed: We have received lots of feedback and updated info from readers fram and active in the region. ¡Muchas Gracias/Muito Obrigado! The article has been UPDATED THROUGHOUT as a result.]

Much like Butch Cassidy and the Sundance Kid headed to Bolivia after they had run out of banks in the Wild West to hold up, so too digital cinema integrators have moved on to Latin America, now that virtual print fee (VPF) coffers are empty in North America and Europe. Yet despite the flurry of Latin America-related VPF press releases at the recent CinemaCon, there are fundamental issues that will make it a challenge to migrate the continent to digital cinema.

We have already discussed the press releases from CinemaCon 2014, including those  related to Latin America, so for a full breakdown have a look HERE. We will not provide a full analysis or analyse each deal, but try to look at the context and outlook for the region, as it struggles to catch up with the rest of the world in going digital.

As we pointed out during ShowEast 2012 it was the last chance for Latin American countries to get a VPF deal and we are unlikely to see many more major deals after this one. Gary Johns from Sony Electronics commented then that their VPF deals for North America were available until 31 March 2013, i.e. almost exactly a year ago. While international deals do have a little longer to run, studios like Twentieth Century Fox have politely but firmly informed exhibitors, distributors and (perhaps most importantly) government representatives in Brazil and elsewhere in Asia that the end of 35mm prints is nigh.

GDC at the Forefront – of press release announcements

It is noteworthy that deployment entities like Scrabble and GDC have signed separate VPF deployment deals with Hollywood studios (here and here respectively), highlighting that the continent could not easily follow deployment patterns and terms even for non-US or EU territories such as India and China. Of these two entities GDC has been the more active, with no less than five announcements relating to Latin America, while Scrabble has been largely silent recently. So what’s the motivation to be aggressive on the VPF front in Latin America?

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Unique’s MovieTransit Scores Major Deals in Denmark and UK

While satellite delivery was the talk of CinemaCon 2014, Unique Digital notched up two significant victories in Europe that point to fibre delivery playing a greater role for digital cinema in Europe.

The deals with UK’s BT and The Danish Distributors Association (FAFID) for Unique’s MovieTransit system also cement the company’s digital cinema service credentials in its two core markets of Scandinavia and the British Isles.

Unique Digital was selected by Denmark’s FAFID after a long evaluation and tender process to deliver DCPs to cinemas using its MovieTransit system. Quoted in the press release:

“Among the reasons we chose to use Unique’s services are their flexibility, the ease of use of the system, and its robust, tried & tested approach to content delivery. We are extremely happy to be able to offer the Danish market with this secure and flexible solution” says Dorte Wiedemann the Head of Secretariat

The agreement will grant all Danish Cinemas, including Greenland and the Faroe Islands, access to Unique Digital’s world leading solution MovieTransit™ which when launched in Norway in 2012 was the first terrestrial electronic distribution system for feature films to be deployed across an entire territory.

The selection of the fellow Scandinavian solutions provider was not a foregone conclusion as Unique had initially lost out in the race to digitise Denmark’s cinema advertising operation to a smaller competitor five years ago – though it won the Danes over last year.

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Kinoton Is Latest Victim of Switch to Digital Cinema

Kinoton logo

Venerable German cinema equipment manufacturer Kinoton is no more, becoming the latest victim of the switch to the digital projection of films. The company issued a press release on 31 March stating:

We, the shareholders of Kinoton GmbH, have decided to dissolve the company and end its business operations with effect on March 31, 2014.

The decision was not an easy one for us. For more than 65 years, Kinoton GmbH and its employees have stood for excellence in developing innovative cinema equipment and providing first-class, speedy service to our customers and business partners.

The progressive digitization of the film and cinema industry has radically changed the market, however. Kinoton GmbH’s existing business model, as an innovative developer of first-class products and vertically highly integrated manufacturer, especially where mechanical production is concerned, isn’t appropriate to the new market conditions. The coming challenges of the digital age call for new concepts and ideas that focus on software and services.

The company was founded in 1948 as Germeringer Kinoton GmbH to service cinemas in in Munich and surrounding areas. It quickly established a reputation for German precision engineering and excellence as it built 35mm projectors that were considered the premium choice for cinemas and film centres.

It must have been a tough call for the company’s managers Renate Zoller and Christoph Doble to pull the plug, but the business was simply not sustainable in the face of the switch to digital cinema. Despite Kinoton having an OEM partnership with Barco, it never established a major presence in the digital cinema projector market.

However, Kinoton will not vanish completely.

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Deluxe To Close Hollywood Film Lab

Deluxe Laboratories in Hollywood
Well, we all knew it was coming. With the motion picture industry’s transition away from 35mm film to digital production and distribution it was only a matter of time before the need for film laboratories would disappear entirely. The industry took a step closer toward that end when on Tuesday when Deluxe Laboratories announced the company would close its Hollywood film lab on May 9th.

Along with Technicolor, Deluxe grew into one of the largest processors and handlers of 35mm film in the world, with offices in Asia, Australia, Europe and North America. The company’s Hollywood facilities date back to the founding of Deluxe in 1919, when they opened their doors adjacent to Fox Film Corporation. Both companies were founded by William Fox, one of the industry’s first movie moguls.

News of the closure came from Warren L. Stein, Deluxe’s Chief Operating Office for North America. An excerpt of the memo Stein sent out with the announcement read as follows:

The capture and exhibition of motion pictures has transitioned from film to digital in recent years. Our processing volumes have declined sharply and as a result, the laboratory has incurred significant financial losses. This has forced us to make this very difficult decision.

Following the recently-announced closure of the Deluxe laboratory in London, our only remaining film processing facility will be the small front end facility in New York.

I would like to thank all of our employees for their incredible contribution to the success of Deluxe, their dedication to meeting the needs of our many customers and their loyalty in recent years as the business declined. Our employees have been the key to all of our successes as a film processing business.

While emotionally attached to our 100 year legacy with film, we are firmly focused on the future of Deluxe. In this historic time in our industry, we wanted to thank our customers for their business and for their trust. We look forward to servicing their needs in the entertainment media marketplace for the next hundred years and beyond!

Earlier this year Paramount Pictures made public their intention to stop supporting film and only release films digitally starting with their holiday release “The Wolf of Wall Street”. Given the number of studios that Deluxe counts as clients, this is clear indicator that, as we predicted, other Hollywood distributors will soon be following Paramount’s lead.

Deluxe provided no information on whether closing its Hollywood operations will result in layoffs and if so, how many employees would be affected. Nor did the company make clear what it intends to do with the facilities in the long run; whether they intend to sell the plant or utilize it for their ongoing service offerings.

Ironically, if that’s even the correct word, it was just this past Sunday during the Oscars telecast that most of us saw a clip of director Christopher Nolan at February’s Academy of Motion Picture Arts and Sciences annual Scientific and Technical Awards accepting an Academy Award of Merit bestowed upon “all those who built and operated film laboratories, for over a century of service to the motion picture industry”.

William Fox Studios & Deluxe Hollywood

How Kickstarter Helped Save Independent Cinemas from Digital Oblivion

Kickstarter has played a significant role in enabling small independently owned cinemas across the United States to make the transition to digital, a detailed analysis by CelluloidJunkie.com has uncovered. Reviewing 70 campaigns to raise funds to assist with upgrades to digital projection and associated technology improvements (mainly sound), we have found that the crowdfunding platform has been used to save at least 38 cinemas across 20 US states and Canada. Spanning a period from mid-2012 to the present date, the overall success rate of Kickstarter 35mm-to-digital campaigns has been 57.6 per cent, with 38 per cent unsuccessful in hitting their funding target and 4.4 per cent cancelling their campaign, while four campaigns are still active. Digging deeper yields interesting results and lessons for how to use Kickstarter effectively to achieve the fundraising goal for switching from film to digital. With Hollywood studios ending 35mm prints distribution this year we expect to see many more small and single-screen independent cinema turn to community and crowdfunding for support.

Kickstarter has in a few short years become the go-to platform for online fundraising for a variety of projects, ranging from smartphone accessories to the Oscar-nominated documentary The Square. As Digitaltrends recently noted, “More than 3 million people pledged over $480 million to Kickstarter projects last year,’ with a total of 19,911 projects successfully meeting their funding targets.  It is should come as no surprise that small cinemas that are unable to tap VPF (virtual print fee) or other forms of Hollywood studio-supported funding mechanisms have turned to the internet to raise the money needed for buying and installing DCI-grade projectors, servers and sometimes also upgrading their sound systems. Finding all of these projects on Kickstarter is no easy task as they are not grouped together, nor does a search for terms like “digital cinema” or “digital conversion” yield all the relevant campaigns. This is because the campaigns are directed by the creators towards the potential audience and supporters, usually through social media such as Facebook and Twitter, rather than towards cinema analysts. As such, we believe that our sample is comprehensive but possibly not 100 per cent complete. Statistics of Success & Failure

There are many conclusions to be drawn from the completed campaigns, both the ones that achieved their funding target and those that failed or pulled out. In total more than $2.66m was raised from a collective goal of $2.38m by more than 25,000 backers for digitising 42 screens in 38 cinemas, with an average donation of $109. Given that the majority of cinemas that started a campaign are independent single-screen theatres, the cost of a single projector and server is largely fixed, with the amount varying depending on additional upgrades to the theatre. As such we found that the campaigns typically ranged from $35,000 to $80,000, with most asking for around $40,000 to $50,000, though there were a handful of campaigns aiming and achieving more.

In two cases in Colorado targets of no less than $150,000 targets were met, in one campaign for four digital projectors for the Denver Film Society ($176,925), while in the other was for two projectors for the Lyric in Fort Collins ($158,692). The latter also had the largest number of backers of any campaign with 2,324 people pledging their support. Yet the single highest amount raised was $195,043 (for a target of $175,000) for the Village Picture Show, Manchester, VT’s “only movie theatre,” by 1,006 backers. Notably, there was also the “Cinefamily Digital Projection & Theater Restoration!” that raised $158,541 for digitising the former Silent Movie Theatre in West Hollywood.

There were 25 campaigns that were unsuccessful in meeting their campaigns’ funding targets. Of a hoped-for $1.6m only around $200,000 was raised. This highlights the fact that almost all Kickstarter cinema digitisation campaign that failed fell well short of their target, rather than just missing out. Of the 25, only three came close to or just over 50 per cent of their target, with many not even achieving ten per cent of their goal. Interestingly the average contribution for failed campaigns was still $94, putting it very close to the average of $109 for the campaigns that succeeded. A further three campaigns were cancelled before they finished, while four are still active, with two of these looking likely to meet their target.

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Support Your Local Cinema – Communities Rally In the Face of Digital Death

StCloude_Brickhouse

With close to 90 per cent of cinemas in the US digitised, the question about what would happen to the last stragglers loomed large even before Paramount announced that it had (reportedly) ended 35mm print distribution. The problem is that while one in ten screens is still reliant on film prints, their contribution amounts to just a few per cent. They typically do not qualify for VPFs (virtual print fees) and might not even be able to tap into NATO’s CBG (cinema buying group). Mostly they are small single-screen community cinemas whose finances were precarious even before the threat of the analogue cut-off.

So it is heartening to see that many communities have rallied around their local cinema and organised fundraisers of various typed that raise the $70,000-$100,000 required to upgrade a screen to digital. Below are some recent examples.

St Cloud, Minnnesota:

“The Brickhouse is now leasing two additional digital projection units after purchasing one digital projector for its largest theater last year. Its smaller theaters have been dark since the transition. The deadline caused hardship for some very small theaters, whose owners were faced with the cost of replacing equipment.” Link.

Some cinemas have turned to Kickstarter to raise the funds, with impressive results.

De Pere, Wisconsin:

The De Pere Cinema has reached its fundraising goal to go digital just days before the deadline.

The movie theater surpassed $40,000 Monday night in its 45-day Kickstarter campaign…

The owners of the De Pere Cinema say even though the campaign officially ends Friday night, donations can still be made. They say any funds above what’s needed for the digital conversion will be used for other theater improvements. Link.

Portland confirms its reputation as Hipster capital by doing a lot to save local cinemas.

Portland, Oregon

“In the last year, the Hollywood Theatre installed a magnificent new marquee following a successful fundraising campaign. The Academy Theater managed to corral the cash needed to install digital projectors, ensuring its survival. One of Oregon’s last drive-in theaters, the 99W Drive-In in Newberg, won a nationwide contest to cover the cost of its own digital conversion.” Link.

This fundraising spirit is not restricted to the US alone.

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Paramount Reportedly Stops Delivery of Film Prints

35mm Film Platter

Well, it may finally have happened. Everyone working in any capacity of the motion picture industry knew the day would come when Hollywood studios would stop distributing their releases on 35-millimeter film prints. If Saturday’s story in the Los Angeles Times is to be believed, that day may finally have come.

More precisely, it came and went. According to the Times, who relied on anonymous sources identified as “theater industry executives”, Paramount Picture’s Oscar-nominated release “The Wolf of Wall Street” was distributed in North America solely in digital format, i.e. without the use of 35mm film prints.

That should finally answer the longstanding question which arises at every industry standards meeting or trade conference; Has any studio released a title in digital-only and, if not, what will be the first title for which no 35mm prints are distributed? That the answer should be “Wolf of Wall Street” is an irony likely not to be overlooked by many.

The movie is helmed by Martin Scorsese, a director who has been a longstanding advocate for the preservation of film. Arguably a poster child for film historians, Scorsese is often credited with having an encyclopedic knowledge of the medium. His 2011 film, “Hugo”, was an ode to F. W. Murnau and the early days of cinema.

Paramount’s move toward all-digital wide releases seems to have only affected the distribution of titles in the North American market. According to the Times, the studio will still be sending out film prints in international territories such as Europe and Latin America, where the conversion rates for digital cinema are not as high.

The National Association of Theatre Owners (NATO) estimates that over 90% of the 40,000+ screens in the United States have converted to digital. This is especially true of the big exhibition chains which were able to finance large scale, expensive digital cinema deployments over the last five to ten years.

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Six Lessons for Cinemas From This Year’s CES

Celluloid Junkie has not ventured to Las Vegas for this year’s Consumer Electronic Show. Like the Hajj it is a pilgrimage that every technology pundit should undertake at least once in their life time, but once is also enough.

We did, however, monitor it remotely and read up on all the news, developments and announcements made there, as well as talked to people on the ground. We hereby bring you the distilled insights from these fact and analysis gathering, condensed into six valuable lessons for cinema exhibitors.

1.  3D is not dead.

No matter what you may have been hearing about last rites being performed on stereoscopic 3D, with attention shifting elsewhere (“Hello, Ultra High Definition TV!”), the format is far from dead. For a start, there is no television set manufactured and sold for over $400 today that is not 3D enabled. It’s just that the function is forgotten or ignored. Yes, there has been a decline in channels supporting 3D, such as sports network ESPN, but Hollywood’s committment has only slowed, not reversed. Gravity forced the most ardent 3D objectors to recant, if only for one movie and don’t be surprised if it ends up winning a Golden Globe, BAFTA or even an Oscar. This is even more the case for markets outside the US, particularly China.

Stereo 3D is becoming better, easier and faster for films. Expect more 3D conversions of classical films and expect an announcement that “Star Wars: Episode VII” will be released in (converted) 3D. The reason CES has no time for TV is same as why they have largely moved on from connected TVs (those apps, other than Netflix and Hulu/iPlayer, that you never use), because they have to dream up a new reason for people to buy big TV sets. This year the reason is UHD TV. Expect 3D to make a return to CES 2015 and particularly 2016 when technology for auto-stereoscopic (i.e. glasses-free) television sets become available. This was the message by one of the ‘Godfathers of the format on a panel at CES’ (from THR): “[3D] needs a restart in the U.S.,” said Steve Schklair, CEO of 3Ality Technica. “The momentum for 3D is diminished. You need a gamechanger, and that will be autostereo.” This will only happen once 4K is established with the likes of Dolby and Philips busy perfecting it in their R&D centres. 3D for live events in cinemas will also be prominent in 2014, though don’t expect it for concert films. Remember, the technology is getting cheaper and better every day.

2.  Forget about Ultra HDTV – it’s HDR that matters (for cinema too).

This years big push when it comes to television seen has been the Ultra HDTV sets – some curved – that CE manufacturers hope will come to grace the living rooms across America and the world. Never mind that TV sets with 4K resolution have been available to buy since 2012, the prices now make them affordable for people other than Bill Gates (though do read these hilarious Amazon reviews of the Samsung UHD TV set - “My wife and I bought this after selling our daughter Amanda into white slavery. We actually got a refurbished. It’s missing the remote, but oh well– for $10K off, I can afford a universal, right?”). The reason 4K TV are a hot topic is because there is finally something 4K to show on them. Previously it was only 4K movies mastered by Sony Pictures on a special 4K player. Now Netflix has announced that the second season of House of Cards will stream in 4K and Amazon has followed suit by announcing a partnership with Samsung, Warner Bros and Lionsgate using Technicolor’s M-Go streaming and up-converting service. So films will be the main source of 4K content.

If any exhibitor is worried that consumers will have access to higher resolution than their 2K Barco or Christie projector, they should look down on their new iPad mini, which already outresolutions more than half of the world’s digital cinema projector. Resolution is not the reason people watch films or TV on their iPad, its the convenience. The more important issue to emerge from CES is high dynamic range (HDR) and rather than talking about ‘more pixels’ the discussion is slowly shifting to ‘better pixels’. Both Dolby and Technicolor proposed solutions for how to expand the colour gamut and peak brightness at this year’s CES. This technology will only come in future television sets, one of the reasons UHD TV is not ready for prime time. But cinemas will be able to piggy-back on these development and take advantage of them in time for laser projection that will help make projected images look even more spectacular than even the most curved 4K Samsung television set in the home. But it will cost you.

3. Atmos is not arriving in the home – yet!

Dolby’s Atmos and it’s Barco rival sibling immersive audio format Auro were was the dogs that didn’t bark at CES 2014. Both companies are clever enough to realise that with only just over 400 and 100 deployments respectively in cinemas world-wide, they do not wish to alienate early exhibitor adopters and potential future clients by trumpeting its soon-to-be entry into the home cinema market. That does not mean that it will not happen. There is no technical reason it could not be down today and as far back as 2012 Dolby told the New York Times openly that they hope to see it on the home. But timing is everything in life and this is some time off. Note also that 22.2 audio has already been standardised by the ITU in 22.2 SMPTE 2036-2UHDTV Audio (pdf).

This means that there is still a head start for cinemas over home cinemas in creating an enhanced experience, plus a branding opportunity for Dolby and Barco. Expect more titles and also a push for lower prices to enable greater take up. Studios are getting behind the format, but it is still struggling to get beyond the premium screens. This high end is where we will see most of the action in 2014, with possible wider adoption in 2015-16, by which time talks about rolling it out in the home will get very loud. [UPDATE - Auro did announce a home cinema venture at CES, though Dolby didn't.]

4. Shape up – Google Glass is coming to your cinema

Wearable devices was another big theme at this year’s CES, but for all the wrist-centred fitness and lifestyle devices, the potentially most disruptive one is Google Glass, which will go from beta to actual product in 2014. Cinemas have become good at tackling camcording film theft in cinemas through a combination of legislation changes, staff incentive programmes, education campaign and forensic tracking to source. However, a discreet camera mounted to glasses cannot be easily detected. The first generation of Google Glass will not be good enough to compete with even a cheap camcorder to pirate a film. Nor will the second. The key lesson is that eventually though Google Glass and its copies will be good enough to record a whole film in a cinema as easily as watching it with 3D glasses today and whether that is year 2016 or 2019 is irrelevant. Also, use two Google glass and you can record the film in 3D.

The Internet will be flooded with ‘STAR WARS EP IX 1080P WEB DL x264 GGLGLS DD5.1 RARBG’ almost as soon as the credits have finished rolling on the first matinee showing – and there is almost nothing the industry can do about it. This is not to say that the fight against film theft, illegal recording, distribution and downloading should hoist the white flag and surrender. But the best fight against film piracy is to make the whole cinema experience superior to watching even a good pirated copy at home. Particularly for the affluent older class (we’ll get to the kids in the next point). In the meantime, expect the ‘concert’ effect, with kids uploading brief clips from the film in cinema, just as people do with concert footage from their smartphones these days. Chasing down every 5 min excerpt of Transformers 5 on YouTube is not difficult, thanks to audio identification tools, but studios have to decide if this is worth their efforts or embrace it as a crude promotion tool for the films. My guess is that they will only ever do so reluctantly, as it goes against everything they have fought on till now. Which brings us to…

5. Make friends with the smartphone

Consumers might not be rushing to upgrade their television sets fast enough for the liking of the manufacturers, but the same cannot be said for smartphones, with a handset replacement cycle of 22 months in 2012 and probably just under two years currently. While we wait for 4K TVs, we have camera-enabled phones that can shoot is resolutions far beyond that. As anyone who has been to a multiplex anywhere in the world in that last year can attest, the message to ‘Switch off your phone’ is falling on deaf ears, particularly for those under the age of 25. This column is not a rant at the pathological inability of young people to resist Candy Crush saga, checking their WhatsApp messages ur updating their status even for the duration of what old timers used to call a ‘single reel’ (that’s 1,000 feet or 300m, which works out to 11 minutes for any Millennial reading this). Short of sending everyone born after 1990 to etiquette school there is little cinemas can do to prevent this. So how do they adapt, particularly so as to not put off the older demographic from abandoning cinemas.

The way forward would be to embrace the smartphone. AMC has already introduced a separate section for those wishing to use their iPhone or Samsung during the film:

An American cinema chain may have the solution that would satisfy both mobile addicts and folks who just want to enjoy movies. AMC plans to dedicate the back row of its 400 cinemas across North America to anyone who can’t go without a phone, even while in a theater. These so called “texting aisles” would include sound- and glow-proof barriers so that other people enjoying the movie wouldn’t be affected.

According to AMC, the idea is to cut down on mobile phone use throughout the rest of the auditorium, though it said it had no plans to introduce similar measures at its branch in Manchester.

It is too early to tell whether this is working or not, but other cinemas would do well to give it a shot to at least cut down on the level of irritating min screens glowing a distracting others from the bigger screen. There is also trials of incorporating the second screen into the advertising pre-show by the likes of Shazam and Screenvision as well as Yummi and DCM. Again, these are early days but technically they have proven themselves. The trick is to get the same Candy Crush users who can’t seem to otherwise put away their S4 to actually try it. Better use of linking ticketing, POS, concessions, loyalty reward schemes and more to the iOS and Android platforms could also include app alerts for people that remind them more effectively to avoid using the phone for the next 2 hours (or no free popcorn!) than a Dinosur roaring it off the screen. Bribes work.

6. The revolution just happened

Cinemas are such a late arrival at the digital party that almost nobody in the rest of the tech world is interested in talking about it. With practically everything having gone digital, including your 105-year old grandmother’s hearing aid, having made the transition often more than a decade ago it’s almost an embarrassment that it took so long. But the film and cinema industry took to heart what Michael Karagosian formulated as the two possible roads digital cinema could have gone down, “we can either do this fast or we can do it right.” Fortunately the people in charge decided to do it right. While cinemas may have problems today and further challenges ahead, it is worth remembering that it could have been a lot worse. The danger now is that the industry should somehow see it as ‘mission accomplished’ or having arrived at an end point, whereas in fact it is at best at a Churchillian “beginning of the end” point.

Now the pressure will come from…real estate. Yes. Cinemas remain the most most inefficient use of land after ski slopes in the summer. And even the latter can monetize the otherwise wasted acreage as grazing ground for sheep. With the majority of the world’s people now living in cities and no sign of a reverse in population growth in all but a few advanced economies, cinemas will increasingly have to justify their existence as a dollar/euro/rupee/RMD per sq ft/meter business. Apple’s stores earned almost $6,000 per square foot last year. Now consider this nugget of information from the article The Business of Show Business Act II: Appraising the Movie Theater by Arthur E. Gimmy, MAI, and William Condon:

Capitalization rates for leased fees will likely vary between 7% and 9% based on a variety of key information, but relying extensively on the credit of the tenant. At an overall annual yield rate of 8% to 9%, the valuation of an older 8-screen theater would be between $2,000,000 to $2,250,000 (or $250,000 to $281,250 per screen) and $55.55 to $62.50 per square foot of building area.

If I was a landlord I know who I would rather have as a tenant. You could argue that this is not so much comparing Apple and oranges as popcorn and nachos, since there will always be more multiplexes than stores selling iPhones. Well, only if you restrict the count to Apple-owned and operated stores as opposed to all consumer electronics and cell/mobile phone operator shops.

The world might not be as flat as Thomas Friedman argued, but the playing field has levelled for cinemas. They may chose to come to Las Vegas a few months after the television set makers have left, but they are now competing on more equal terms than ever. The advantage is that they can now dive into the field of Internet-of-things, iBeacon, Big Data, social media and integrate it directly to your system. The bad news is that your equipment replacement cycle won’t be as short as smart phones or even television sets (down from 8.4 to 6.9 years), but it won’t be very much longer. Time to book your ticket to CES 2019 to see today’s cutting edge cinema technology in the home cinema’s rear view mirror by then.

 

Hollywood Studios Embrace High Frame Rate For All Films (Sort Of)

CineAsia 2013

A large flat screen monitor displays trailers at CineAsia

It should come as no surprise that Warner Bros is showing off the trailer for “The Hobbit: the Desolation of Smaug” in high frame rate (HFR) at the current CineAsia trade show in Hong Kong. After all, that is how director Peter Jackson filmed it and wants audiences to see it. What is more surprising is that WB is also showing HFR trailers for its other films: “300 Rise of Empire” and “The Lego Movie”. What, you didn’t know that they were HFR? Then you will be even more surprised by the HFR trailers for films from Disney, 20th Century Fox and Sony Pictures. In fact ALL these studios’ film trailers were playing in HFR.

Seeing these trailers will come as a surprise to those who thought that Messrs Jackson and James Cameron were the only ones advocating and shooting in HFR and not expect auteurs like Wes Anderson or multi-hyphenates like George Clooney to also have embraced the format. But walk around the displays of WB, Disney, Fox and Sony and you will see the trailers on loop for all of their future films showing the same smooth, video-like HFR characteristics. Sony Pictures “Robocop” reboot looks just like the console game it will no doubt tie in with, while “Heaven Is For Real” looks like a shot-on-video TV film-of-the-week. Disney’s “Bears” looks just like a Discovery channel documentary while Angelina Jolie slinks about super-ultra smoothly in “Maleficient”. Over at Fox, Iceland is looking crystal clear in “The Secret Life of Walter Mitty” while “The Book Thief” and “The Monument Men” give us a video vision of World War II.

By now you might have worked out that none of these films were actually shot in HFR. But the way the big monitors from Samsung and LG have been set up with default 100Hz to 200Hz refresh rate, interpolation and edge enhancement, MPEG+ and other “image improvement” features they might as well have been shot in HFR for the look it creates. The only studio to have calibrated its display monitor to give a film look to its titles is Paramount, showing the new “Jack Ryan” and “Noah” trailers the way people will see them in the cinemas. (Universal only has a cardboard standee for “47 Ronin”).

This might seem like a trivial issue. After all, the studios show off the trailers on the big screen properly in their product reels. That’s where it matters, surely? But overlooking the trailers at a trade show, seen by exhibitors over and over is emblematic of a larger issue.

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