Category Archives: Digital Cinema

Screen Digest’s David Hancock Discusses Europe’s D-Cinema Funding Shortfall

Posted by J. Sperling Reich | July 7, 2010 12:35 pm

Europe's Digital Shortfall (Courtesy Screen Digest)

On June 21st, just in time for Cinema Expo, Screen Digest published a report titled “Digital Cinema Moves Into The Mainstream“. Twelve pages in length and with 10 tables and charts, the report uncovered a significant “digital shortfall” in the amount of financing required to convert all of Europe’s screens to digital. David Hancock, a senior analyst at Screen Digest, authored the report and we asked him to shed some light on its key findings. (The interview appears after the jump).

Details From The Report
Not counting Russia there are roughly 32,600 screens throughout Europe for which a digital rollout will cost EUR €2.1 billion (or USD $2.65 billion). Of those screens 23,800 are covered for digital conversion through virtual print fees offered by Hollywood studios. Upwards of 5,000 screens will be handled directly by theatre owners themselves. Theoretically that means there is funding of EUR €1.65 billion (or USD $2.1 billion) for d-cinema conversions, leaving a gap of EUR €450 million (or USD $568.4 million) to cover all Europe’s screens.

And who is being left out of the funding equation? Well, it’s mostly art houses, seasonal theatres, repertory venues and mobile cinemas.

The United Kingdom and The Netherlands have set up special funding groups to help solve this problem. Support funds have also been established in such countries as the Czech Republic, Finalnd, France, Germany, and Sweden. On region in Poland plans to pull money out of a tourism fund and Italy is giving tax credits to any theatre which converts. The European Union is offering assistance through its MEDIA Programme.

Driven mostly by 3D content, the number of European screens equipped for d-cinema at the end of the first quarter in 2010 had risen 16% over 2009 to 5,333, or a full 15% of the region’s screens. Presently 75% of all digital screens in Europe are 3D capabe. Thanks to competition among France’s largest exhibitors, the country leads the 3D screen count with more than 700. The U.K. and Germany are second and third hovering around the 500 screen mark.

Posted in Digital Cinema
Tagged as Arts Alliance Media, Digital Finance Limited, Europe, European Commission, MEDIA Programme, Screen Digest, Sony, The Netherlands, UK Digital Funding Partnership, XDC, Ymagis

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Director’s Fortnight Highlights Digital Divide

Posted by J. Sperling Reich | May 14, 2010 3:48 am

Last night I had the privilege of attending the opening night of the Director’s Fortnight at the Cannes Film Festival. The film being shown was “Benda Bilili” a fantastic documentary about a Congolese band made up of homeless parapelgics who go on to win international acclaim. Before the lights dimmed however the audience was addressed by the head of the Société des réalisateurs de films, the French Director’s Guild which organizes the Cannes sidebar.

After handing filmmaker Agnès Varda a lifetime achievement award, Malik Chibane (at least I believe it was him) turned to the audience with a serious word of caution. He was speaking in French and between what I understood and what was translated by the person standing next to Chibane I figured it was worth repeating here.

Keeping in mind, I’m paraphrasing, Chibane told the audience that “Benda Bilili” was being shown in 35mm and a film projector, which is how films had been shown for the past 100 years. However, this won’t always be the case. Very soon cinemas throughout France will undergo a digital conversion and films will be delivered on hard drives. He warned that such technology will actually decrease the diversity of films being shown in theatres, especially for French films. He stated that small theatres wouldn’t be able to convert to digital cinema, just those showing big blockbuster films.

Then as the film started a short 20 second promo put together by the SFR was shown. Again it was in French so I’m paraphrasing, but effectively the message of the animated spot was that a lack of diversity undermines the movies and that digital cinema threatened French culture. The trailer is embedded at the head of this post. Read More »

Posted in Countries, Digital Cinema
Tagged as Benda Bilili, Cannes Film Festival, Director's Fortnight, France, La SRF, Malik Chibane

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Texas Instruments On Track With 4K

Posted by J. Sperling Reich | March 26, 2010 12:50 pm

Both at ShoWest and in the weeks leading up to the conference, I was able to speak with some of the folks over at Texas Instruments working on the company’s digital cinema offerings. They were happy to report that development of their 4K chip was right on schedule and some of the first 4K DLP projectors should be available for purchase in the first part of 2011, if not a little sooner.

For those who are just tuning into our industry, TI is the group that has been making DLP chips for cinemas since 1999. Each DLP chip is an array of 2.2 million microscopic mirrors that move and rotate at high speeds to reflect the appropriate light and provide 2K image. Projectors based on the company’s DLP digital micromirror device (DMD) have been installed on over 19,000 movie theatre screens worldwide, giving them at least 90% of the digital cinema install base.

However, last year for the first time TI’s dominance in the market was threatened when two of the world’s largest cinema chains, AMC Theatres and Regal Cinemas, announced they would be installing Sony’s 4K digital cinema projectors. While the DCI spec may only call for 2K, the marketing advantage of 4K was hard to overcome with exhibitors who were looking for a future-proof solution. So in June of last year TI announced they would be developing a 4K DLP chip for their OEM manufacturers, which include Barco, Christie and NEC. No development timeline or release date for the new chip was given. Read More »

Posted in Digital Cinema, Equipment Vendors
Tagged as 4K, DLP Cinema, Projectors, Series 2, Texas Instruments

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SmartJog Continues Partnership Spree With XDC and Fox

Posted by J. Sperling Reich | March 26, 2010 12:39 pm

Is it just me, or has anyone else noticed that SmartJog has been on a roll lately when it comes to partnerships? After announcing an agreement with Ymagis in February, they formed a partnership with XDC just before ShoWest and earlier this week entered into a deal with Twentieth Century Fox to deliver digital cinema content.

The agreement with XDC mirrors the one SmartJog signed with Ymagis in that XDC will deploy SmartJog’s technology in theatres it has contracted with. Specifically, each cinema will receive a SmartJog Gateway server which will act as a central library storage device that receives the content. The two companies will integrate their solutions to better automate the delivery of digital cinema content. What wasn’t clear from the press release was whether XDC would eventually integrate SmartJog’s technology directly into their own theatre management system (TMS).

SmartJog’s solution will enable XDC, which operates primarily in Europe, to deliver digital content into its theatres directly from their mastering facility in Liège, Belgium. Additionally, XDC will also be able to deliver content to any of the more than 160 cinema complexes in SmartJog’s digital cinema network throughout Europe. Commenting on the agreement, Fabrice Testa, XDC’s Vice President Sales and Business Development was quoted in the release:

Read More »

Posted in Business, Digital Cinema
Tagged as Content Distribution, Fabrice Testa, Julian Levin, SmartJog, Twentieth Century Fox, XDC, Ymagis

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More Rumblings About DCIP’s Financing

Posted by J. Sperling Reich | February 28, 2010 11:31 pm

Last week both the New York Times and the Wall Street Journal reported that an announcement from Digital Cinema Implementation Partners about their financing was imminent. The opportunity to play 3D content will certainly be welcomed by AMC Theatres, Regal Cinemas and Cinemark, however from the way the two newspapers covered the story you might get the impression it was the only reason. The financing would allow Hollywood studios to “roll out more 3-D movies in the wake of the success of James Cameron’s ‘Avatar’” wrote the Wall Street Journal and the New York Times said the “money would allow future 3-D film releases”.

Both media outlets seem to have gotten their hands on some internal briefings or at the very least seen an early draft of a press release as they have updated some of the details from previous reports about DCIP’s financing. A more exact figure of USD $660 million was cited by both papers which is down from the original USD $700 million rumor which was first floating around. As well, the number of screens has been upped to 14,000 from 12,000 with the Wall Street Journal putting the number of actual theatre sites being converted at 1,100. The New York Times laid out the details as follows:

According to a draft announcement making the rounds in Hollywood, the new financing, arranged by JPMorgan and Blackstone Advisory Partners, would total about $660 million. Of that, $445 million is expected to come from senior bank debt, $135 million from what is described as “junior capital” and $80 million from equity contributed by the member theater circuits. Nine banks, including Bank of America and Citibank, are part of the lending group. Blackstone raised the $135 million from other investors.

I always find it amusing to see how mainstream media covers the transition to digital cinema in reporting such news. The Wall Street Journal piece states:

In a digital conversion, theaters rip out old celluloid film projectors, and stop receiving weekly shipments of large film canisters. They instead use fiber optic lines to transfer huge digital film files.

Posted in Digital Cinema, Integrators
Tagged as AMC Theatres, Cinemark, DCIP, New York Times, Regal Cinemas, Wall Street Journal

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SmartJog and Ymagis Team Up To Deliver D-Cinema Content

Posted by J. Sperling Reich | February 18, 2010 3:51 pm

Ymagis and SmartJog Partner

SmartJog and Ymagis issued a joint press release yesterday announcing they had reached a non-exclusive partnership agreement and will integrate their technologies to offer theatre owners a more robust digital cinema offering. The pairing seems as if it would be complimentary given that SmartJog specializes in high speed delivery of digital content and Ymagis focuses on digital cinema deployment.

What this means is that when Ymagis installs digital cinema equipment at one of their theatres, they will also be deploying SmartJog’s digital content delivery solution. During the first phase of the partnership, the SmartJog Gateway will be integrated into the Ymagis Cinema Central Server, which is a theatre management system. Content will arrive through the SmartJog Gateway and be handed off to the Ymagis TMS. This solution requires a theatre to make room for a separate piece of network connected equipment. The second phase of the partnership will integrate the software which runs the SmartJog Gateway directly into the Ymagis Cinema Central Server, allowing for content to be delivered straight to the TMS without need for additional hardware.

One bonus that comes with the partnership is that the two companies will be able to share their respective content delivery networks. This means Ymagis would be able to send content to any theatre in SmartJog’s network, even if the exhibitor wasn’t signed up with them. Both companies are based in France so it’s no shock that integration and deployment will begin in that country. Most, if not all, of the exhibitors Ymagis works with are in Europe.

Posted in Business, Digital Cinema
Tagged as SmartJog, Ymagis

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JPMorgan Finds $700 Million For DCIP

Posted by J. Sperling Reich | February 10, 2010 5:42 pm

That collective sigh of relief you may have heard over this past weekend no doubt came from the North American motion picture exhibition and distribution industries. The Los Angeles Times report that investment bank JPMorgan was finally able to round up roughly USD $700 million for Digital Cinema Implementation Partners must have come as some relief.

Heaven knows we’ve been hearing about DCIP’s quest for financing for well over a year now. It seems at every ShoWest, Cinema Expo or Show East for the past 18 months we’ve been told by investment bankers that money is on the way. Though let’s face it, if the staggering amount of money being sought wasn’t enough to cause a delay, the worldwide credit crunch certainly didn’t help. Financing hasn’t been easy to come buy in any business sector and no matter how lucrative the project.

Of course, DCIP is the deployment entity founded by three of the world’s largest exhibitors; AMC Theatres, Cinemark and Regal Cinemas. With anonymous sources close to the negotiations confirming that DCIP’s financing will be announced in the next two weeks, the company can finally begin the rollout digital cinema technology on 12,000 screens across the United States and Canada.

Back in 2008 JPMorgan, armed with virtual print fee agreements from the studios, went looking for USD $1 billion for DCIP to convert 14,000 screens across all three circuits. Since then, AMC has gobbled up Kerasotes adding another 900 odd screens to the mix. There was no word on which screens or theatres will be converted or what will happen to those screens which don’t make it into the first 12,000. Nor was a time frame given to complete the transition, though it has been widely expected to take three years.

Posted in Digital Cinema, Integrators
Tagged as AMC Theatres, Cinemark, DCIP, J.P. Morgan, Los Angeles Times, Regal Cinemas

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Germany Experiences A Digital Hiccup With “Avatar”

Posted by J. Sperling Reich | December 30, 2009 5:58 pm

Problems With "Avatar" In Germany

It was bound to happen. With James Cameron’s 3D epic “Avatar” being released on more than 16,000 screens in 122 countries on December 18th, surely there would be a few snafus. One Deluxe insider claimed “Avatar” marked the first movie title for which they shipped more hard drives with digital cinema packages (DCPs) than 35mm prints. So whether it was a faulty server, malfunctioning projector or invalid key, a few dark screens or missed screenings seemed inevitable. And with the enormous amount of promotion and hype surrounding “Avatar’s” release there were thousands of sold out auditoriums making whatever problems that cropped up difficult to hide.

Few would have predicted that such issues would be caused by humans, rather than technical errors. But that’s just what happened in Germany during the first few hours of “Avatar’s” release. Apparently upwards of 70 screens were unable to play the film in digital 3D because they had not received the keys, or received the wrong keys. The problem affected theatres run by Cinestar and Cinemaxx in cities such as Eisenhuettenstadt, Mainz, Garbsen and Berlin. Audiences that had shown up for the first showings of the film were told they could see the film in 2D or were offered a refund.

It should come as no surprise that news of the dark screens spread rapidly in mainstream media, especially in the tech press. Outlets such as The Register and Heise ran stories that faulted Deluxe Digital, the service provider Twentieth Century Fox used to distribute both 35mm and digital prints. However, having seen first hand the amount of resources, energy and effort Deluxe put into the release of “Avatar” it is highly unlikely that they somehow managed to bungle the key delivery. More probable is that one of Fox’s field offices neglected to relay some last minute playdates they had managed to secure.

Posted in Digital Cinema
Tagged as Avatar, Cinemaxx, Cinestar, Germany, Twentieth Century Fox

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Kodak Digital Cinema Undergoes Major Strategy Shift

Posted by J. Sperling Reich | November 20, 2009 10:53 pm

For the past several weeks there have been whisperings in conversations throughout the motion picture exhibition industry about organizational changes at Kodak Digital Cinema. To put an end to the conflicting reports that were coming my way I did the most simple of things; picked up the phone and spoke with someone directly at Kodak. Strange, I know, given that this business has gotten us all so used to playing our cards close to the vest, but sometimes a direct approach actually works.

Indeed, Kodak Digital Cinema is dramatically changing the focus of its business. Bob Gibbons, Director of Marketing and Communications for Kodak Digital Cinema lived up to his title by being very upfront in explaining the company’s new strategy. “We’re going to really concentrate on areas that build more directly on our unique capabilities of service and intellectual property licensing,” said Gibbons. “We’re going to discontinue all development and manufacturing of our preshow advertising systems, our Kodak screen management servers, our Kodak theatre management systems and what I refer to as our role as a feature systems integrator, putting the packages together and marketing the packages.”

Acting as a systems integrator has been the most visible part of Kodak’s digital cinema business up until now. Moving forward, Kodak Digital Cinema will instead develop and license digital cinema technologies to be commercialized by others while continuing to provide services and support for existing systems. Though Kodak may not be manufacturing preshow video players any longer, they will continue to prepare and distribute preshow content and playslists.

Posted in Digital Cinema, Integrators
Tagged as Bob Gibbons, Kodak Digital Cinema

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Fancy Heading Up UK’s Digital Cinema Group?

Posted by Admin | August 24, 2009 5:51 am

The UK’s Cinema Exhibitors’ Association (CEA) had previously announced that they are setting up an organization to support small-to-medium sized exhibitors in the switch to digital, along the lines of the semi-hibernating Cinema Buying Group (CBG) of NATO. CEA’s CEO Phil Clapp commented at the time that:

many [cinemasl also recognise that they are extremely unlikely to be able to secure funding deals to allow them to convert on their own. We strongly believe that the proposed funding group may be the only option to achieve this for a significant majority of small and medium-sized cinema operators.

Now the time has come to appoint someone to head up this mission. From the announcement:

As detailed in an advert appearing in the next edition of Screen International, the CEA is looking to recruit - initially on a six month contract - an individual with the following qualities:

Experience of work in film distribution and/or exhibition at a senior level, with an understanding of the key industry issues and processes between the two sectors;

Experience of digital cinema contracts and/or deployment;

Knowledge of the major US studios and international distributors, including the key decision-makers on issues around digital cinema;

Proven negotiating skills; and

Experience of running an organisation at director or a similar senior level.

Key initial tasks for the successful candidate will be to: establish the necessary business, governance and financial structures for the group; undertake an analysis of the current market for digital cinema in relation to group members; and, through discussion with potential funding partners and others, to identify those approaches which might provide a ‘best fit’ for group members with regard to financial support.

It may be somewhat optimistic to think that this can be achieved in six months, but the contract does have an extension option. Expect whoever is appointed to be spending a lot of time on a plane somewhere between Heathrow and LAX.

Posted in Digital Cinema
Tagged as Cinema Exhibitors' Association, UK

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