CJ @ CineAsia: General Industry Trends in the Asian Movie Industry; from 3D to Laser to Content (ICTA)
This is a real-time transcript of one of the sessions at CineAsia 2015. As such, we sometimes paraphrase what is being said by the speakers. Any errors are more likely than not our fault.
After the MPA presentation came the ‘State of the Region’ technology panel discussion from the International Cinema Technology Association (ICTA)
Host: Mike Archer, Vice President, Worldwide Cinema Sales at Dolby Laboratories
Moderator: Ioan Allen, Film Audio Pioneer & Senior Vice President, Dolby Laboratories, Inc.
Joe Chang, President, Ambassador Theatres
Dick Sano, Managing Director-Film Distribution, Sony Pictures Entertainment Japan
Mark Shaw, Executive Vice President of Operations, Shaw Theatres
Jo Yan, EVP and Managing Director, Universal Pictures China
The session began with an Award of Excellence for Services to the Industry to veteran Jim Murray, a long-time rep for both Doremi and DTS, presented by his colleague Mike Archer.
Mike – Thank you, a lot of great information [in the previous MPA seminar]. Yes, I am VP at Dolby, but I’m here as president of ICTA and here to give an Award of Excellence. We give this out when we get the chance to give it to someone who has has an impact. Jim has been running around here for almost 25 years. His experience has really advanced the industry. He worked with Greater Union. Set up in Singapore. Then he was off to DTS in 1995. Then he moved to the US and helped push out multi-channel audio during what was called “the sound wars”. Then he moved to Doremi in 2011 and pushed the next generation of technologies. Again, really focused on the Asia region. Then last year he came with the Doremi team to Dolby. Now he is back in Australia enjoying the good life. A lot of what I learned I learned from Jim. Everyone in this region knows how to say ‘Jim Murray’ in English.
Jim Murray – I would like to thank the Sunshines, the studios, the exhibitors and everyone. Special thanks to Michael Archer. (Sometimes known as the War Officer, sometimes as The Minder, thanks also to my wife Ailene.) I am fortunate to be in an industry I love. This award was not earned but belongs to the many people I have worked with. Thank you. I have fond and funny memories of CineAsia and Asia: coming out of a meeting and asking “Was that a ‘yes’ or a ‘no’.” Riding tuk-tuks. [There were many other incidents mentioned] This moment is very special to me. I hope you can all share the joy this industry has given me. Ejoy the festive season.
Mike – Next presentation, by Ioan Allen, also from Dolby Laboratories
Ioan – This is the third year we have done an early morning panel. [Introduces the panel.] I have a bunch of questions and topics to discuss. What is your population and screen count?
Joe – Our population [Taiwan] is 23 million [didn’t hear screen count].
Mark – [Singapore has] 263 screens and another 7 open in January for population of 5.5 m
Dick – [Japan has] 3700 screens – a little bit under-screened.
Jo – Still waiting for [China] year-end numbers. But we will be in the neighborhood of 31,000 screens for 1.4 billion. [audible collective intake of breath in the audience]
Ioan – Will we see growth in screens?
Mark – 20-30 more screens this coming year.
Dick – The only reason Japan is increasing is that more screens are being made than theatres quitting. But in two years it will be stagnant.
Jo — Growth will be in tier 3, 4, 5, 6 cities. Means that we will have 30-33% growth in one year. Whether it is sustainable I don’t know. Lot of doom sayers saying it has to end at some point, but nobody knows when.
Ioan – Do you know admissions per person?
Jo – Less than 1 visit per year.
Dick – 130-160 million admissions in Japan per year.
Mark – 4.2 in Singapore.
Joe – 1.6 in Taiwan. We don’t increase screens that much. So we hope we can gross more.
Dick – In 1958 we had 1.1 billion in Japan and exhibitors have been increasing exhibition cost. Now we are looking at how good we can make experience. Previously competition was discounting, when there were 3-4 cinemas in a town.
Ioan – Luxury seating catching on?
Dick – Yes, there is balcony where you can get wine and you can get there an hour early. I don’ know what they will do for that hour. [laughs from audience] And in places like Ropongi those places get sold out first.
Jo – In China it is different. It is vast country so you can’t see it as one place. So when I say growth is from tier 3 down there won’t be luxury seating. Admissions will grow because there weren’t cinemas in those places before. But to move admission even 1% you need a LOT of admissions. People can afford it in the Tier 1 and 2 cities.
Joe – I agree. In mature markets you can have luxury seating but not in the suburban market.
Mark – All the exhibitors in Singapore have luxury seating. Works best in city centres. But because of real estate cost you have to decide if you want a luxury screen or an Imax. Typically you need two VIP screens because you need kitchen and all that. In Singapore the up-charge is double or three times as much. Seven to twenty dollars.
Ioan – In Japan we know it is 300 bucks (laughter).
Mark – We distribute a lot of film and we see a lot of day-and-date for independent films. We are maybe four days ahead.
Joe – Local distributor used to distribute VHS tape a few days after cinema release. Remember that we do not wish to repeat this mistake with VOD.
Ioan – It used be thought that cinema release was part of marketing ahead of consumer release in home. But seems like consumers no longer know the value of the film when it comes out for the home.
Dick – I feel the first window should still be cinema. Japanes audiences know that for SVOD openings this is not a film that you would have to go out to cinema for. Netflix had launched in Japan but so far they have been quiet.
Mark – We do not advertise in newspapers any more. It is all social media, online and radio. It is very non-traditional. We promote the venue, we push Imax, we promote the venue. Theatrical should be the first big market.
Jo – I don’t think the audience is less informed. The amount of information you get on the internet and social media there is so much that it is difficult to stand out. So it is not whether you use the theatrical window or not but how do you stand out to your target audience. In th case of China it is a very distorted market because the window is so well defined, because everyone has to go through China Film Bureau. We just completed a long and painful contract negotiation with CFB.
Ioan – It is a paradox that you use social media to promote the movie but it is what you compete with. It is supping with the devil.
Dick – It is like TV, we used to think that it was the devlil, but we have to use it to advertise.
Mark – We see VOD as replacing DVD and Blu-ray, so you don’t have to go to rental store. In Asia we live in multi-generation homes and you don’t want a date night with your girlfriend while granny is looking over your shoulder.
Ioan – Spielberg gave dire prediction two years ago that in ten years you would only have big event pictures for a premium pricing.
Jo – Aready answered by some of my colleagues. Cinema is much more durable than some peope think. That kind of prediction has been made before when TV and DVD came along. “That’s the end of cinema,” but it didn’t happen. Cinema is a social experience, people need to socialise, people need to go out.
Dick – In Japan 3D is still working in cinemas [not in home].
Joe – Because cinemas have upgraded their equipment it makes cinema more like a social space, so you go out and hang out with your friends.
Mark – There is a place for Imax and $100 but there will also be a place for reasonably priced tickets. You still go to restaurant even though you can get take away.
Ioan – Demographic getting younger or older?
Joe – In Taiwan main demo is teens and young adults. Females are the decision makers; which film they will see.
Mark – Ours is largely unchanged. Teenagers go a lot. When they start working it drops off. When they have kids they returns and then they buy four tickets and four popcorn.
Dick – Challenge we have in Japan is that young people don’t come to cinema. Local studios are TV stations that are blown up TV series for big screen so teens go so that they can talk about it with their friends in school. Films like Twilight don’t really work. That is why we still advertise in newspapers. If you tell teens don’t use your mobile phone for next two hours, that is torture for them.
Jo – Young people in China are different from Japan, because they still use phones in the cinema. Average age is 21 year old in China. People will go to see the big Hollywood blockbusters, which targets this segment anyway. I wonder because of special structure in China whether that is always going to be the case. In the quote it is the blockbusters that get approved, but the more majority of product does not get in. Maybe if the market opens in the future, will the median age be the same?
Ion – About cellphones. do you have formal policy to tell people not to use cellphones? Does it work?
Dick – In Japan it works.
Mark – We play a lot of PSAs and we see less cell phone usage than five years ago.
Jo – I was being unfair (in case there are Chinese reporters). There are fewer people talking on their cell hnes. But still sending messages on WeChat , “It is a crap movie I’m watching”. Pictures of “I am the only one in this cinema.”
Ioan – Are you still running anti-piracy PSAs?
Dick – We run the anti-piracy Camera guy PSA and we make $150,000 per year form selling that [anti-piracy figure] as a key ring.
Ioan – New technology. With adoption of HDR and PLF and immersive audio that this represents widespread trend that all cinemas have to adopt this in the future or boutique for a few theatres?
Joe – It depends on the cost. You build up the PLF screen in Dolby Atmos, which will cost a lot compared to regular screen. Price is so high that we cannot afford it for every screen. In Taiwan we don’t have a single laser projector yet. Because of price. We hope we will have reasonable price. Because the quality is very good.
Mark – There is segment of the audience that wants PLF and that is part of the name – Premium – but if everything was Premium then nothing would be Premium. People have a general expectation of quality and then some people want special experience.
Dick – In Osaka there opened biggest screen in the country. But talking about Dolby Atmos, you only have one screen when a title arrives, but the second week if another film comes out, then we can only run it for one week.
Jo – In China, especially in big cities, audiences are willing to pay premium RMB to go and see large format or special sound systems. They would pay for it. And that is why Imax and CGS are so successful.
Ioan – Back onto laser projectors. There is a misunderstanding of only use it to save lamp cost. But if you use it for dynamic range, it is something for people to get into. [Question about pre-show/advertising and sound levels for adverts/trailers].
Joe – Taiwan only 9 minutes for trailers and adverts. Very tight. Asking government to increase this to 12 minutes so that audience can know upcoming movies. Start time is for start of pre-show.
Mark – We have 25 minutes for all PSA, adverts. If I had more I could not play 5 films per day.
Dick – Typically 20 minutes. First trailer slots for their (cinema company’s) own movies. Still TV adverts but not so common you have trailers made especially for cinemas.
Jo – Time for pre-show is all over the place. Depends on the exhibitors. Different cinemas in same chain have different policies. Difficult to get trailers placed. Mostly used for adverts. Trailers typically play in the lobby on big screen.
Joe – Half-way house lights [and in all other territories, it seems] Sound level a bit lower.
Mark – Depends on the ad. Trailers played at same level. If advert made for cinema same level.
Dick – A little bit lower.
Ioan – Will number of technologies increase in the next ten years? You poor guys, the exhibitors, have to pay for that.
Joe – We will have new technologies for movie industry, but maybe it is like 270-degree film, but it depends on whether studios will support this new format.
Mark – Digital was around for a long time before it rolled out and it was studios VPF support that made it happen. We need consolidation because I don’t see what will add to the experience.
Ioan – 4D or 4K will not have impact?
Mark – 4K on the big screen, maybe, but not 4D.
Joe – 4D can enhance the experience but not turn a bad movie into a good movie.
Dick – We have Ang Lee 120fps film but nobody in Japan can show it that way. Hopefully they will install it. We have to keep evolving.
Jo – I agree. I am glad I don’t have to figure out new technology. Hard to figure what can be done to make experience more involving. Saw demo last week on my cellphone the Justin Linn 360 degree app. If that applied in movie environment it could be something else.
Ioan – Indigenous 3D productions?
Dick – Very few, maybe two productions. “Attack on Titan”. Unlike Hollywood, unless it is big, big budget, a $10 million budget [Japanese] movie is consider big.
Jo – Audience love 3D but they hate fake 3D. They want real 3D. 90% of all cinemas in China are 3D capable. That is pretty staggering. Local producers are making films in 3D because they know they can charge a premium. The standard of local 3D films is improving.
Mark – We have seen a decline of 3D, partly because of many bad 3D and the up-charge has stung people, because in Singapore we are on the verge of recession.
Joe – People can get dizzy. Plus up-charge. Unless they can increase light.
Ioan – Are there any [35mm] film theatres left?
Joe – 100% digital.
Mark – Flagship still has 35mm but not run for a while.
Jo – Almost 100%.
Dick – Hard to supply them [35mm cinemas] with movies.
Ioan – 70mm. The Tarantino. 2.76:1. Are you putting in 70mm screens or any left?
Joe – We don’t have 70mm.
Mark – I don’t think I have screen big enough.
Jo – Maybe in science museum. Not in commercial venues.
Dick – I totally respect US exhibitors trying to accommodate Tarantino. How many did they install? [Ioan – 30-40]. Coming back to 3D, we are servicing industry. We have to provide options.
Ioan – One of problems in US, projectionists used to film are gone, replaced by IT person. Significant print damage because nobody knows how to splice 70mm. Let me aks you about Star Wars pre-bookings.
Jo – In China pre-booking is different. Hasn’t opened yet. May happen, but not yet.
Dick – I am sure it will be big. Opens 18 December at 6:30pm. Not sure why that time.
Mark – We released advanced 3 weeks ago. 12:30 at 17th. And it is pretty sold out.
Joe – Not sure how big it will be. Pre-sell big, but not huge like the US.
Ioan – Thank you.Questions from the audience? [None] Nope. Alcohol in the theatres. Which territories allow?
Joe – Depends if you have license. You can go to nice restaurant or bar near cinema.
Mark – We applied in a few of our screens. We don’t sell a vast amount. Cultural.
Ioan – Thank you all for coming.