Is the air going out of the Chinese cinema business already? You wouldn’t think so from the strong opening numbers that The Amazing Spider-Man 2 delievered, opening on close to 40% of all Mainland screens this past weekend.

The problem is what took place before, during the May Day/Labour Day holiday, which was the end of the ‘blackout’ period when Hollywood films were restricted from releasing. As Variety rightly points out three Chinese films took the top three spots: My Old Classmate, The Great Hypnotist and Ice Man: 3D, which took USD $34.6 million, USD $22.3 million and USD $10.5 million respectively. “Overall the week was worth $59.2 million (RMB370 million), a drop of 14% compared with last year’s holiday week, when both “Iron Man 3” and local hit “So Young” were battling it out.”

But this drop starts to sound more alarming when you read local media.

However, according to preliminary statistics released by the domestic movie box office, right, May 1 to 3, the domestic box office in diminishing daily, respectively 137,000,000, 129,400,000, 95,500,000 yuan, with the three days adding up to only 362 million yuan, not a record high, lower than last year’s record high of 434 million by a lot. As the national ticket bunker city of Suzhou, May file box office performance is not very smug. Yesterday, the head of Jin Yi, Golden Harvest, Su Yi and other major studios, told reporters, “compared with  last year, almost every film screening time are playing flat or falling.”   LINK

A drop of 14% might not seems so bad for a major holiday, but this is a market where box office has grown year-on-year by over 30% per cent in the last year and cinemas are growing at a rate of more than 38% – and both are expected to keep growing without fail. So comparing like-for-like the drop is actually closer to 40%. Both the No. 1 and 2 films were small-to-medium budget films, but for Donnie Yen’s IceMan 3D, which cost 200 million yuan this is a major under-performance, with the article drily observing it having “word of mouth down to the freezing point.”

To put it very bluntly, Chinese cinemas cannot afford major domestic flops as they grow at breakneck speed and plan IPOs. Only Spider-Man swinging to the rescue prevented deeper soul searching about whether the current Chinese multiplex growth is sustainable.

USA: An interesting idea for a Priceline or Hotwire-type of service for movie tickets, Dealflicks’ founders have been criss-crossing the US to convince cinema owners. (Just don’t mention Groupon). Good long article by the LA Times that grasps the intricacies of the exhibition business.

Dealflicks lets theater owners select which movies they wish to discount, at what price and when. Unlike Priceline, there is no negotiation involved. Customers buy the tickets through Dealflicks’ website or iPhone app. The company typically charges 10% to 20% of the ticket sales.

Since its launch nearly two years ago, the company has contracted with about 350 theaters that show films on 2,000 screens in California, New Jersey, New York, Connecticut, Florida and Kansas. Dealflix recently signed up 65 theaters at the annual CinemaCon trade show in Las Vegas, offering cash prizes to theaters that sign contracts.  LINK

USA (CA): Is Dolby undervalued as a company and stock? Seeking Alpha seems to think so.

Until now the company had dealth [sic] almost exclusively with sound technology, but these two technologies [HDR and glasses-free 3D TV] along with the suite of technology acquired from Doremi should indicate Dolby’s expansion into imaging. If Dolby is successful in imaging as it has been in sound, it will be well on its way to monopolizing the entire recording process and not just sound.

To Summarize

As long as Dolby’s patents remain the industry standard in the cinema industry, licensing revenues will continue to be strong and gross margins will remain around 90%. The company has a rock-solid balance sheet and is generating excellent free cash flow. With little competition, Dolby should remain the industry leader in its niche for the foreseeable future, and looks like its about to enter another niche.  LINK

USA (GA): Carmike has released its first quarter figures and they are reasonably good, though operating costs were up and the company was more keen to talk about the 19% stake in Screenvision that it is selling than about its quarterly profit/loss. (As my former CFO said, “revenue is vanity, profit is sanity.”)

“Carmike’s theatre circuit outperformed box office and attendance gains in Q1, as well as our 17th straight quarter of higher year-over-year concessions and other per patron spending,” stated David Passman, Carmike Cinemas’ President and Chief Executive Officer. “The Company’s per screen admissions revenue and attendance grew approximately 12% and 9%, respectively, versus the prior-year period. This compares to reported domestic industry box office revenue and attendance growth of approximately 6% and 5%, respectively, during the quarter.

“A more compelling, diverse and well-spaced film slate, versus the comparable period, positive contributions from the first full quarter of operating results from the nine theatres and 147 screens we acquired from Muvico in late 2013, as well as several recently opened Carmike locations, drove strong top line financial performance in Q1. LINK

Event Cinema

UK: It might seem like a strange choice of content, until you remember that survivng WWII veterans are now in their 80s and 90s, so travelling to the cinema rather than down to London makes more sense.

UK cinemas to broadcast live BBC Radio 2 event for the first time to commemorate the 70th anniversary of D-Day, during which Patrick Stewart will play Sir Winston Churchill.

The BBC is to stream a live D-Day concert from the Royal Albert Hall to cinemas across the UK on June 6.

Picturehouse Entertainment co-ordinated the deal, which will see equal mapping of cinemas through Cineworld, Picturehouse Cinemas, Vue and independent cinemas across the UK.  LINK

Vatican: DSAT will be hoping for some heavenly brownie points in return for their involvement in the live beatification of not one but two popes simultaneously – in 3D. Sadly I couldn’t find any pictures of nuns wearing 3D glasses.

The canonization of Pope John XXIII and Pope John Paul II, two of the most iconic Popes in history, represented a worldwide event that will mark a milestone in television and media distribution. For the first time it was possible to watch live an official papal ceremony through the immersive experience of stereoscopic 3D. The entire canonization ceremony was produced and broadcast in Europe in 3D, thanks to an international co-production by the Vatican Television Center (CTV) in collaboration with Sky Italia, BSkyB and Sky Deutschland, in partnership with the event distribution company Nexo Digital, the cinema satellite service provider DSAT Cinema and the 3D technology expert SENSIO Technologies Inc. and with satellite delivery provided by Eutelsat.

Thanks to the partnership with Nexo Digital, DSAT Cinema and SENSIO Technologies Inc., and satellite capacity provided by Eutelsat movie theaters part of the DSAT Cinema network were able to screen this live 3D event. Participating DSAT theatres were mainly located in Austria, Belgium, Germany, Italy and Spain.  LINK

Pop-up Cinema

UK: Maybe it is time we called a moratorium on writing more about outdoor cinemas? Have you say in the COMMENTS section of the Daily.

These days it seems like everyone and his dog has an outdoor cinema franchise: you can see ‘em in parks and pub gardens, on rooftops and riverbanks. But one of our favourites will always remain The Nomad, veterans of the scene who don’t just provide a top-flight movie in a gorgeous location but lay on an impressive spread of food ‘n’ drink to boot.

This year’s Nomad programme has just been announced, and it’s the expected selection of ’80s and ’90s favourites (‘Dirty Dancing’, ‘ET’, ‘The Matrix’), plus a handful of established classics including ‘Singin’ in the Rain’ and ‘Breakfast at Tiffany’s’. But it’s the locations that really keep things interesting: get a shiver down your spine with ‘The Dark Knight’ in the shadowy confines of Brompton Cemetery or enjoy the Riviera chic of ‘The Talented Mr Ripley’ on the watery banks of the Serpentine in Hyde Park.  LINK

Piracy

UK/Europe: Not that this excuses film piracy, but research apparently demonstrates that unlike music pirates, illegal film downloaders are still prepared to pay for cinema tickets.

Viewers who illegally download movies also love going to the cinema and don’t mind paying to watch movies, according to research by two economists at the University of Portsmouth.

Dr Joe Cox and Professor Alan Collins said that movie pirates were less likely to stop paying to see movies despite also illegally downloading, with prolific movie pirates tending to be wealthier, less worried about being caught and more likely to cut down their piracy if they think they are harming the industry.  LINK

Law

Russia: Perhaps Putin didn’t like The Wolf of Wall Street’s inflationary use of the F-word. Good thing that there aren’t more serious things to worry about in Russia.

President Vladimir Putin has signed a law on May 5 prohibiting swearing in public performances, including cinema, theater and other forms of art. The law will come into effect on July 1, and afterwards swearing in films, plays and concerts will incur penalties of up to 2,500 rubles ($70) for individuals and up to 50,000 rubles for companies and organizations.  LINK

India: What’s the Indian equivalent term for shameless vote grabbing?

Housing Minister of Karnataka State Government and Sandalwood’s versatile actor Rebel Star Ambareesh has decided to give a biggest treat for the cinema workers. The actor turned politician, who graced the Labourers Day celebration on May 1 2014, organised by Cinema Workers Federation, has revealed that he will be granting the houses for the cinema workers under government scheme. “I will be granting the houses for all the workers of cinema, which includes the technicians, light boys and others. People, who are mainly dependent on film making for their bread will be benefited with this scheme. As an artist I can understand the problems of the cinema workers, which made me to come up with this scheme,” said Ambareesh, who was addressing the gathering.  LINK

Cinema Opening/Closings

Canada: It’s not often that you get a lengthy editorial in the local newspaper as to why you need a local multiplex, but the editor of the Battleford’s News Optimist feels that the existing cinema is just not up to scratch.

The limitations of the Capitol are obvious. The most obvious is the size of the screens within the cinemas. Sadly, the facility is simply not built to offer movies in the wide-screen 3D format that movie patrons demand in the 21st century.

Because the existing facility is limited to only two screens, the selection of movies is limited. Movie fans in the Battlefords often feel they are missing out on the popular movies they see advertised.

It seems obvious the only acceptable solution for moviegoers in the Battlefords is for construction to begin on a new multiplex cinema that offers a minimum of five screens, offering full digital and 3D capacity and the most state-of-the-art sound quality.  LINK

USA (KY): First you are born as an multiplex, then you a bigger multiplex opens so you become an art-house, then a discount theatre, finally you close and get converted into shops and cafes.

The former Cinemark movie theater at Lexington Green will be redeveloped into retail shops, restaurants and office space.

The eight-screen Cinemark Lexington Green Movies 8 closed last month.

A minor amended development plan changing the building’s use from a movie theater to retail and office space was filed recently with the Division of Planning, planning manager Bill Sallee said.  LINK

Finally

The Creators Project has pulled together quotes from several notable film makers (and some techno futurists) on what the future of film and cinema holds. It’s a mixed bag.

James Cameron to Smithsonian Magazine:

“I think there will be movie thea­ters in 1,000 years. People want the group experience, the sense of going out and participating in a film together. People have been predicting the demise of movie theaters since I started in the business.”

Martin Scorsese, in an open letter:

“The art of cinema and the movie business are now at a crossroads. Audio-visual entertainment and what we know as cinema—moving pictures conceived by individuals—appear to be headed in different directions. In the future, you’ll probably see less and less of what we recognize as cinema on multiplex screens and more and more of it in smaller theaters, online, and, I suppose, in spaces and circumstances that I can’t predict.”  LINK