Disney has lent some support to Arts Alliance Media’s European virtual print fee proposal to convert 7,000 screens across Europe, though the press release reads like there some reservations and that the deal is not as clear cut in terms of support as previous deals. Take the last sentence of the first paragraph:
Under the terms of the agreement, Disney will supply European exhibitors with its feature films in digital format and will make provisional contributions towards the digital cinema hardware costs of AAM-deployed DCI-compliant screens. [italics added]
So AAM’s digital screens will get Disney Digital titles (including the all-important Disney Digital 3D ones), but the payments for screening these are ‘provisional contributions’. That must means that no final agreement on payment has been concluded. Similar working arrangements were signed in the US by AccessIT as well as Technicolor with a number of studios, so it is not unheard of, but it is not good for market certainty in the longer term. What guarantees are there in place that Disney will not halt the payments in 12 months time? Only the AAM and Disney lawyers have an inkling.
It is an open secret that it has proved quite difficult for AAM to sign up the last two of the major Hollywood studios, Warner Bros and Disney, who, having been the early pioneers of digital in Europe, have been more cautious about committing to digital recently, perhaps because they know this market better than most. Even the previous deal with Sony Pictures Entertainment was apparently not what it seemed, with suggestions that the pan-European deal excluded Germany, Austria and Switzerland, as indicated by the sentence in the press releas, “Sony Pictures has committed to supply its films to certain European countries in digital format.” [italics added]
The pressure is now on WB as the last hold-out to sign some sort of deal with AAM, preferably before ShoWest, so that AAM can claim a six-studio Royal Flush. But WB has a history of working closely with XDC and are likely to want to announce any non-exclusive deal with more than one European operator. Meanwhile there is a genuine worry that as the number of opt-outs and provisional arrangement grows, these types of deals will increasingly come to be seen as, well, Mickey Mouse VPFs.