Tag Archives: Scrabble

Daily Cinema Digest – Tuesday 15 April 2014

Berwick cinema

The Wall Street Journal examines the plight of small-town single-screen cinemas that are unable to make the costly transition to digital in the article ‘Is Film the End of the Road for Small Cinemas?‘. It highlights one particular cinema near Scranton, Pennsylvania, facing imminent death-by-digital.

Hollywood’s major studios are in the final days of distributing movies on film reels and moving to digital distribution sent via hard drives or satellite, a method that is cheaper for studios but requires significant investment by theaters in new equipment. The conversion means theaters like Mrs. DiAugustine-Bower’s Berwick Theater could fade out for good.

The theater, about 50 miles southwest of Scranton, has raised only $6,000 so far, a difficult amount to earn by selling baked goods and old movie posters in an economically depressed town.

“I got a backlash from patrons when I mentioned raising ticket prices” to $5 from $4, said Mrs. DiAugustine-Bower.

But help has come for some from an unexpected quarter: Indian digital cinema integrator Scrabble.

About 87% of the 5,762 theaters in the U.S. are now digital, according to the National Association of Theatre Owners. The remaining 13% is mostly made up of one-screen independents, in rural communities with no multiplexes for miles.

More than half of the approximately 600 drive-in theater screens in the country have converted so far, according to the United Drive-In Theatre Owners Association.

Scrabble Ventures LLC has begun leasing digital projectors to small theaters that can’t afford a lump-sum payment. Chief Executive Ranjit Thakur said the company has converted 370 theaters so far with more than 400 scheduled over the next three months.

Kickstarter, the Colorado State program, Kiwanis International club, state department funding and local donations are ways that some of that other cinemas have managed to raise funds.

Business

LAemmle Santa monica 4

USA (CA): As we highlighted in our item on ArcLight coming to Santa Monica, existing cinemas there will have to shrink to compete.  Hence Laemmle’s 4 screen will ‘expand and contract’.

The Second Street cinema currently has four screens and about 1,100 seats but a proposed makeover would add two screens and drop the seat total to below 500, said Laemmle CEO Greg Laemmle.

The largest theater would hold about 150, which is about the capacity of the current smallest theater. Two mezzanine-level theaters would seat about 35, Laemmle said.

“The row spacing is better and we believe the sight lines will also be better,” Laemmle said. “The added screens provide flexibility to show more movies for longer.”  LINK

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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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ShowEast 2012 is Latin America’s Last Chance for VPF Deals

This year’s ShowEast cinema trade show is likely to be the last one where any significant virtual print fee (VPF) deals are still on the table. Not only will there soon be no more actual 35mm prints to replace with fees for  virtual ones, following the winding down of film operation by Fuji and Kodak. But Hollywood studios too are rapidly winding down their funding mechanisms. This is particularly bad new for Latin American countries, which have the lowest digital cinema penetration numbers for any continent bar Africa. This was highlighted at the recent 2nd International Conference on Digitisation of Cinemas in Bogota, Colombia, which “focused on the difficulties being experienced by Colombia and Latin America in general in finding the financial model and public funds to help the region convert its cinemas to digital technologies adhering to the global standard.”

With approximately 13,500 systems installed around the world (over 10,000 in North America and over 3,000 in the rest of the world), Sony is intent on pushing its global market share up from the current one tenth of all world-wide screens. Hence Sony’s decision to extend its VPF scheme, most likely by agreeing to lower terms with the Hollywood studios in return for longer lead time. As quoted in THR:

“[Some] VPF deals for the U.S. and Canada ran out at the end of September. Ours are available until March 31, 2013,” reported Gary Johns, senior vp, digital cinema solutions at Sony Electronics. The deadline to sign up for Sony’s program in international markets extends even further out.

Sony is also using the ShowEast opportunity to showcase its newest SRX-R515P projector designed for small and medium auditoriums, as well as its Entertainment Access Glasses for hearing and visually impaired cinema patrons.

ShowEast has traditionally been the cinema trade show for Latin American countries and there is no more pressing issue for that region than the imminent end of 35mm prints and the do-or-die conversion to digital in less than a year. As such, it should come as no surprise that third-party digital cinema integrators, consultants and VPF brokers from across the world are homing in on Latin America. The most recent operator, India Scrabble, has just announced a deal for three territories:

The company has signed separate non-exclusive agreements with Hollywood studios Warner Bros Pictures International, Universal Pictures International, Walt Disney Motion Pictures International and Sony Pictures Releasing International Corporation… The roll-out of the technology will begin from 2013 and will initially be launched in Brazil, Mexico and Chile.

Note that 20th Century Fox and Paramount are missing from the list of studios. While neither of these two will get a free ride on the equipment installed by Scrabble under the terms with the other studios, it highlights the difficulty of getting VPF deals in place this late in the day. Other operators were already present in the region. Cinedigm signed a deal last year with Contenido Alternativo for satellite delivery of DCPs and alternative content, under which it would also “collaborate with theatres in Mexico to bring digital cinema deployment and Virtual Print Fee management services to the region,” on as-yet unsepcified terms. Cinedigm has more recently signed a deal for 290 screens out of the 437 operated by Caribbean Cinemas (pdf) in Puerto Rico, the Dominican Republic, Aruba, St. Lucia, St. Maarten, Antigua, St. Kitts, St. Thomas and Trinidad.

Cinedgim has also signed a deal (pdf) with Brazil’s DGT for the deployment of its software solutions suit, “in preparation for its VPF program roll out later this year.” Similarly, Arts Alliance has contracted with Mexico’s Cinemex for the deployment of its software, though the exhibitor is “negotiating its own VPF (Virtual Print Fee) deals directly with the studios” for its 2,000 screens. Yet the largest obstacle to digital cinema installations in LAtin American territories is not Hollywood studios refusing VPF deals but high tariffs and restrictions on imports of digital cinema equipment. Brazil recently reduced its import duty, but it won’t be until analog screens start going dark for lack of 35mm film that governments across the continent are likely to wake up. Come ShowEast 2013 it will be a very different picture for the continent.