Editorial opinion: D-cinema is E for effort

Michael Gubbins in London 28 Jun 2007 00:00

The announcement of a major European financing deal for digital cinema put the proverbial cat among the pigeons at this week's Cinema Expo in Amsterdam.

To be fair, the virtual print fee (VPF) agreement announced by Arts Alliance Media, Fox and Universal Pictures International didn't need to be the fiercest of felines. Over the last few years in Europe, the description 'headless chickens' might have been more ornithologically exact than pigeons.

Europe once had real ambitions to lead the way in digital cinema. The more enthusiastic advocates at the start of the process used to talk about shifting the balance of power away from Hollywood.

Such ambitions would always have been a tall order given the fragmented nature of the European business and the fact that for many exhibitors, the studio stranglehold is more of a loving embrace. But Europe has simply thrown away a great many of the advantages it had. Europe needs D-cinema but the interminable debate about DCI standards has been an object lesson in navel-gazing. While Europe talked, other territories got on with it.

The US is not, despite the hype, streaking ahead but it's pulling away from Europe because its roadmap is clear. Certainly, one can see economies of scale shifting into place in the US through which, for example, the rapid growth of 3D cinema might become a reality.

China, India and other parts of Asia are at least thoroughly engaged in the process.

Latin America might also be in that group. Early adopters in countries such as Brazil have expanded. There are many blots on the landscape - not least in the fears of those Latin American pioneers that they will see their work bulldozed by heavy-handed insistence on a narrow set of screening standards.

No-one can deny the substance at the heart of many disagreements about digital cinema. How the little independent cinemas in smaller European countries are going to survive in the digital future remains a serious issue. There's no model yet that can really encapsulate the interest of the whole cinema business.

Such problems may be an issue for national governments but perhaps the expectation of public intervention is proving a roadblock to growth in Europe. A number of exhibitors this week commented that they were worried they could sign up for the current VPF deal when taxpayers might end up footing a big part of the bill.

That seems a highly unlikely scenario. The brave digital screen network initiative in the UK is perhaps the best known intervention thus far, but that was about kick starting a process, not footing the bill long term. Governments are not going to be keen to support a process that is meant to reduce costs for exhibitors and distributors.

The VPF deal is untested. It has set aside some of the difficulties of D-cinema for future resolution rather than solved them. But there's one thing about the agreement that must be universally welcomed... it's real. It's ink on paper; it's figures in a spreadsheet. After years of the same dreary discussion about who will pay for change, here's one answer.

It proves that distributors are willing to financially support exhibition in the switch to digital and to securely provide product in a non-exclusive deal.

Is it the best of all possible deals in the best possible world? Nope. Is it a good deal when you get through the fine print? That remains to be seen. Are there better alternatives? Well, let's see them to compare.

A strong box office in 2007 should not drown out that nagging tick-tock: the competition for customers' time grows tougher every day. It's surely better for Europe to address problems while moving along the digital cinema track than to sit perpetually on the start-line.

Do you agree? Email feedback@screeninternational.com or michaelgubbins@emap.com

http://www.screendaily.com/ScreenDailyArticle.aspx?intStoryID=33367&strSearc h=vpf&strCallingPage=ScreenDailySearchSite.aspx

Geertsen says European industry should pay its share for digital revolution

Robert Mitchell in Amsterdam 26 Jun 2006 15:47

As the 15th Cinema Expo International got underway in Amsterdam today Anders Geertsen, director of distribution at the Danish Film Institute and director of the commercial module at the European Digital Cinema Forum, delivered a call to arms to the European industry.

Delivering the convention's first keynote address on the subject of digital cinema - a topic which will dominate the event this year - in a session titled 'Tackling Digital Cinema Head On: Its Impact On The Landscape of European Exhibition and Distribution' he objected to the term "roll-out".

"It conveys a notion someone will do it for us," said Geertsen. "It is utterly stupid."

He explained that Europe and Hollywood must work together to devise a European Virtual Print Fee (VPF) model, a system which sees distributors paying a set fee per new film released digitally towards the cost of digital installation incurred by exhibitors, a system already working well in the US.

He emphasised, however, that although 67% of market share in Europe comes from US product while local product, European product and titles from the rest of the world each represent 11% of the market, that European distributors must pay their share.

"We must get European producers, distributors and studios on board. A European VPF model will only work if all take part," he said. "It makes no sense for US distributors to foot the bill alone."

He warned that if the European industry did not partake fully in such a scheme then they might find their own films shut out from their own country's cinemas.

He also called for smaller exhibitors to form consortiums to negotiate deals on their behalf to avoid being shut out. Explaining that on average in Europe 12% of theatres generate 60% of the box office and half the theatres (77% of the screens) generate 90% of the box office, he warned that single-screen exhibitors could be in danger.

"When 90% of box office can be gained from digital screens the majors will most likely stop supplying 35mm prints to those without digital equipment," he said. "And those cinemas will go bankrupt."

http://www.screendaily.com/ScreenDailyArticle.aspx?intStoryID=27793&strSearc h=vpf&strCallingPage=ScreenDailySearchSite.aspx

Microspace Revolutionizes the Digital Cinema Experience by Delivering the North American Premiere of "TRANSFORMERS" via Satellite to 4,000 Viewers

http://www.microspace.com/news/pr/2007/pr_transformers.shtml

Source: Microspace

Autobots® and Decepticons® Beamed to the 2007 L.A. Film Festival

Raleigh, NC and Hollywood, CA – L.A. Film Festival – June 25, 2007 – Microspace Communications Corporation (Microspace), the leading distributor of digital cinema via satellite, today announced that it will deliver the North American premiere of DreamWorks Pictures and Paramount Pictures’ release of “TRANSFORMERS” to the L.A. Film Festival on June 27, 2007.

The exclusive pre-release screening of “TRANSFORMERS” will represent the first time a motion picture has been delivered via satellite to the L.A. Film Festival. The distribution will be one of the largest film premieres in history and will be screened simultaneously to thousands of viewers.

“Digital delivery is a key element in the change to digital cinema,” said Jim Tharp, president, domestic distribution for Paramount Pictures. “We are so pleased to partner with Microspace for satellite delivery of TRANSFORMERS at the LA Film Festival.”

“Satellite delivery of motion pictures continues to gain significant traction among studios and exhibitors as return-on-investment is realized,” said Curt Tilly, manager of digital cinema distribution at Microspace. “The quality and reliability that digital delivery yields, enables both studios and exhibitors to feature the highest quality presentation the first time and every time.”

Microspace collaborates with studios, content preparation companies and exhibitors to utilize satellite distribution and its benefits. The proven workflow and electronic delivery of Microspace’s satellite distribution provides the industry with a turn-key solution for content delivery and minimizes the potential issues and costs associated with physical delivery. Through the use of two discrete satellite systems, movies and keys are delivered on-time, every-time at Microspace connected theatres.

The North American premiere will be open to 4,000 people across four theaters in Westwood Village where they will view the Autobots® and Decepticons® battle it out. The premiere will take place on June 27, 2007 at 8:15 p.m. “TRANSFORMERS” will open in theaters nationwide on July 3, 2007.

For centuries, two races of robotic aliens – the Autobots® and the Decepticons® – have waged a war, with the fate of the universe at stake. When the battle comes to Earth, all that stands between the evil Decepticons® and ultimate power is a clue held by young Sam Witwicky (Shia LaBeouf). An average teenager, Sam is consumed with everyday worries about school, friends, cars and girls. Unaware that he alone is mankind’s last chance for survival, Sam and his friend Mikaela (Megan Fox) find themselves in a tug of war between the Autobots® and Decepticons.® With the world hanging in the balance, Sam comes to realize the true meaning behind the Witwicky family motto – “No sacrifice, no victory!”

DreamWorks Pictures and Paramount Pictures Present, in Association with Hasbro, a di Bonaventura Pictures Production, a Tom DeSanto/Don Murphy Production of a Michael Bay Film, “TRANSFORMERS” starring Shia LaBeouf, Tyrese Gibson, Josh Duhamel, Anthony Anderson, Megan Fox, Rachael Taylor with John Turturro and Jon Voight. Directed by Michael Bay from a story by John Rogers and Roberto Orci & Alex Kurtzman and a screenplay by Roberto Orci & Alex Kurtzman, the film is based on Hasbro’s Transformers™ Action Figures. The producers are Don Murphy, Tom DeSanto, Lorenzo di Bonaventura and Ian Bryce and the executive producers are Steven Spielberg, Michael Bay, Brian Goldner and Mark Vahradian. The director of photography is Mitchell Amundsen. The production designer is Jeff Mann. The film is edited by Paul Rubell, A.C.E. and Glen Scantlebury. The costume designer is Deborah L. Scott. The music is by Steve Jablonsky. The music supervisor is Dave Jordan. The special visual effects are by Industrial Light & Magic. This film has been rated PG-13 for intense sequences of sci-fi action violence, brief sexual humor and language.

About DreamWorks Pictures DreamWorks Studios was formed in 1994 by Steven Spielberg, Jeffrey Katzenberg, and David Geffen. The company won three consecutive Best Picture Academy Awards with “American Beauty,” “Gladiator” and “A Beautiful Mind” (both co-produced with Universal.) Among the company's other successes have been such films as “Saving Private Ryan,” “War of the Worlds,” “Dreamgirls” (all co-produced with Paramount), and “Blades of Glory.” Among its upcoming productions are “Transformers” (co-produced with Paramount), “Things We Lost in the Fire,” “The Kite Runner (distributed by Paramount Classics), and “Sweeney Todd ” (co-produced with Warner Bros.).

About Paramount Pictures Corporation Paramount Pictures Corporation (PPC), a global producer and distributor of filmed entertainment, is a unit of Viacom (NYSE: VIA, VIA.B), a leading content company with prominent and respected film, television and digital entertainment brands. The company's labels include Paramount Pictures, Paramount Vantage, Paramount Classics, DreamWorks, MTV Films and Nickelodeon Movies. PPC operations also include Paramount Digital Entertainment, Paramount Home Entertainment, Paramount Pictures International, Paramount Licensing Inc., Paramount Studios, and Worldwide Television Distribution.

About Microspace Microspace Communications Corporation (Microspace), a subsidiary of Capitol Broadcasting Company, is the leader in satellite services for digital cinema, business communications and digital signage. The company operates the largest global business satellite broadcasting network with nearly 340,000 remote links worldwide. With a 20-year heritage, Microspace’s VELOCITY® satellite services power more digital signage networks globally than any other vendor, supporting CompUSA, Abercrombie & Fitch, OOH Vision and more.

The VELOCITY service is available either as a dedicated solution or as an on-demand service, enabling customers to easily and affordably expand bandwidth as their needs change. Microspace is headquartered in the U.S. and has a presence in Europe and Latin America. For more information, visit www.microspace.com.

EUROPE EYES DIGITAL

by Bill Mead

June 25th, 2007

FJI Digital Cinema Editor Nowhere else in the world is the digital-cinema rollout more complex than in Europe. Compared to the U.S., where similar virtual print fee (VPF) arrangements have prompted an initial first wave of installations from exhibitors, Europe has more difficulty finding the common ground among the exhibitors, distributors, and digital-cinema providers on which equitable financial sharing arrangements can be built. In Europe, as elsewhere, the question of "who will pay" has evolved into a series of follow-up questions about how to develop equitable cost-benefit sharing deals that are fair today and are sustainable in the future. Europe is a diverse market. Not only are there cultural factors but business and economic factors contributing to rollout complexity. There are more than 800 distributors operating in Europe and the mix of Hollywood studio and locally produced content varies by country, typically averaging around 70% imported titles. 35mm prints tend to be crossed-over between theatres more than in the U.S., so any print savings have to be spread across multiple theatres. There are also more theatres which are either part-time or with a relatively low annual number of admissions. Overall lower screen counts result in lower economy of scale from creating digital copies. The business in each country also varies greatly depending upon the amount of governmental participation in the cinema industry. Europeans tend to look upon their cinema industry as extensions of their culture and therefore are willing to provide varying degrees of public support for technology upgrades. In Norway, for instance, the government has publicly committed to digitizing all cinemas and promises to pay at least 40% of the conversion cost. "We are not pushing digitization to get a plaque saying 'First Country in the World to Go Digital.' We are doing it because we believe there are clear benefits of a speedy digital adoption for Norwegian cinemas," says Dave Spilde, CTO of Unique Digital and the NORDIC project. In the U.K., the majority of funding for the U.K. Film Council digital initiative was provided by the government. There are also differences between the exhibition organizations that require consideration in matching the exhibitor's needs with the offerings and capabilities of the various digital-cinema providers. Exhibition organizations range from large multinational companies down to small single-screen operations. Larger exhibitors usually have their own in-house technical support, while smaller exhibitors are more dependent on their digital-cinema provider supplying the day-to-day know-how. The common ground among all digital exhibition stakeholders (exhibitors, regional distributors, studios, or the filmmakers) is the understanding that the industry must get on with the conversion one way or another. Today's market is focused largely on the costs for digital. While digital exhibition's long-term benefits are now widely acknowledged, the benefits are much harder to quantify in the short term and therefore more difficult to build into today's costs-vs.-benefits business negotiations. In spite of the complexity, European exhibitors who have converted are seeing the benefits. In addition to the general advantages of digital exhibition, such as improved image quality and flexibility of programming, European cinemas have been leading the world in presenting new and exciting forms of alternative content such as rock concerts, opera and Formula I racing. For example, City Screen Cinemas in the U.K. screened opera performances live from the Met in New York, which saw sold-out shows and healthy bar/concession revenue--an experience not possible without digital cinema. European exhibitors are also seeing success with digital 3D shows. According to Disney, 3D screenings of Meet the Robinsons grossed 2.6 times more than traditional or non-3D engagements. As well as higher grosses, more titles are being released in 3D. DreamWorks has said that all its releases will be in 3D by 2009. 3D is a justification for cinemas to convert to digital, not only because of increased revenue potential but as a way to differentiate the cinema experience from home viewing--now more important than ever. European industry associations such as the European Digital Cinema Forum (EDCF) have been active in getting exhibitors, distributors and various digital providers to the negotiating table. Dave Monk, chief executive officer of the EDCF, comments, "EDCF supports the notion of a fair share plan where all those who will benefit by using digital should contribute to the funding process. Through the EDCF's Distribution Support Group, we are encouraging distributors and exhibitors to get together in their individual territories to develop plans that are right for that territory." The major U.S. distributors have also been active in encouraging European exhibitors to get on with the conversion. Julian Levin of 20th Century Fox says, "Fox is fully committed to the European digital rollout, as it is for the rest of the world, and is currently in the advanced stages of discussion with a number of European providers for cost-sharing arrangements." Levin points out that equipping for DCI-specified digital projection is the essential first step in getting ready for the 3D titles that Fox and other distributors have in the production pipeline. Taking the early lead in the European rollout is Belgian-based XDC, which currently has approximately 260 d-cinema grade systems and 50 e-cinema grade systems under its management. Bernard Collard, general manager of XDC International, says, "XDC is clearly leading digital cinema in Europe and is committed to be a deploying entity aiming at a large-scale digital-cinema rollout. Hence, the pan-European rollout target for XDC is 8,000 digital screens within the next five years." XDC, an offshoot of EVS Broadcast, was an early pioneer involved in the European deployment since 2002. XDC offers its customers a range of flexible, custom-fitted lease or rental plans using DCI-compatible equipment, training, installation and technical support. Currently XDC is continuing to build out its content production and distribution with key alliances. XDC Deutschland and CinePostproduction will cooperate to offer to filmmakers, producers and distributors one large-scale digital-cinema rollout. Hence, the pan-European rollout target for XDC is "One-Stop Shopping" digital-cinema services in Germany. This cooperation will facilitate and optimize the digital workflow: production, post-production and processing of the digital copies. XDC Digital Content Lab has also extended its facilities in order to create DCI-compliant copies that are playable on all current DCI-capable servers. The new mastering equipment accepts more available source material, is easier and faster to operate, and simplifies the process of creating and distributing security keys. Arts Alliance Media (AAM), the integrator behind the 240-screen U.K. Film Council deployment, is also actively expanding its role as a digital-cinema provider. Based in the U.K., AAM is expanding its operations to include system financing and is working with major studios to secure VPF offsets to help reduce exhibitor costs. AAM has secured financing and is teaming up with various post-production facilities to be able to offer exhibitors an end-to-end solution for the digital conversion. "This is an exciting time for digital cinema in Europe, and for Arts Alliance Media," declares Howard Kiedaisch, chief executive officer of AAM. "We hope to be making announcements shortly regarding both a commercial business model for pan-European digital-cinema rollout and the future growth of our operations. These milestones will strengthen our leadership position in European digital cinema and enable us to continue to build and expand our network." The UKFC Digital Screen Network rollout was completed on April 30 and will run for four years. More than 200 cinemas in the U.K. can now benefit from digital cinema, with all 240 screens having DCI-compliant 2K projectors. Since February this year, AAM has been operating and maintaining all nine screens at the Odeon Surrey Quays (which became the U.K.'s first all-digital multiplex) as part of Odeon's commercial digital-cinema trial in the U.K., and it will also operate 10 screens in Norway. This June, the Norwegian cinema association, Film & Kino, will consider extending the trial in terms of the number of screens and time period. AAM's in-house digital-cinema lab has prepared over 120 titles and shipped over 1,600 digital prints, including content from BVI, Warner, UIP, Momentum, Lionsgate, Pathé and Optimum. AAM has also trained over 500 projectionists in the U.K. in digital-cinema technology. Technicolor Digital Cinema (TDC), a division of Thomson, whose U.S. rollout began early this spring with initial deployments with National Amusements, is concentrating on developing the support infrastructure and relationships to extend its U.S. position into Europe. TDC already has film support facilities in London and Rome with ties to post-production facilities throughout Europe. TDC began its European digital initiative with a 130-screen arrangement reached in summer 2006 with the Kinepolis Group of Belgium. Kinepolis is using TDC expertise in system integration, along with its Theatre Management System, DCI-compliant servers from Dolby Laboratories, and projectors from Barco, with the goal of converting the entire circuit to digital by the end of 2008. Currently, TDC is investigating the opportunity to run pilot tests with other leading European exhibitors, whereby they can familiarize themselves with the workings of the system in the interim period before long-term studio agreements are in place. Tom Cotton, TDC's European VP of business development, comments, "The recent addition of digital-cinema mastering services in London strengthens Technicolor's position in the European digital-cinema marketplace and demonstrates our commitment to digital exhibition globally. Alongside our distribution services, our rollout operations in Europe are developing well. I believe the appetite exists within the exhibition community to go digital, and upcoming agreements with the U.S. studios will kick-start the transition, making 2008 an exciting year." Following their success in the U.S. market with over 3,000 screens installed, AccessIT is also actively pursing opportunities and building relationships in Europe. Chuck Goldwater, president of AccessIT's Media Services Group, comments: "AccessIT is the only company that has actually done a large-scale digital-cinema deployment. AccessIT understands the complexities and issues involved in meeting the real-world requirements of both the exhibitors and distributors." Goldwater points out that it takes an exhibitor having typically at least 50% of its screens converted before a distributor can effectively book digital content into that circuit. Exhibitors need enough screens equipped so they can keep a particular title in digital throughout its run, eliminating the cost of providing an additional 35mm print. As such, AccessIT is focused on those exhibitors who are prepared to make circuit-wide commitments to convert. According to Goldwater, AccessIT is actively in discussions with a number of European exhibitors and will be announcing its alliances and partnerships when there is clear benefit to all the parties involved. In addition to the large pan-European d-cinema initiatives, there are many other country-specific d-cinema plans in markets such as Italy, France, Germany and Norway. Overall, Europe is moving forward with its digital conversion with activity across all territories and, to everyone's benefit, with business negotiations converging on universally acceptable solutions. Bill Mead recently joined FJI as digital cinema editor and is also the publisher of DCinemaToday.com.

http://www.dcinematoday.com/dc/extURLs.aspx?ID=283

Breakthrough D-cinema agreement signed with US studios

Breakthrough D-cinema agreement signed with US studios Screen staff 25 Jun 2007 04:30

A potential breakthrough in the "who pays?" deadlock that has stunted digital cinema rollout is unveiled today at Cinema Expo in Amsterdam.

Digital distribution pioneer Arts Alliance Media (AAM) has reached an agreement with Universal Pictures International and Twentieth Century Fox to offer Europe's virtual print fee (VPF), which could cover up to 7,000 screens.

The studios have also committed themselves to distribute digital content to theatres signing up in countries including the UK and Ireland, Germany, Austria, Switzerland, France, Spain, Italy, the Nordic region and the Benelux. Other studios are expected to follow soon.

The VPF is a means of financing conversion in which distributor and exhibitor contribute over a period of years to installing the necessary equipment for making the digital shift.

Exhibitors are subsidised by distributors in installing equipment while distributors can make substantial savings in the cost of prints.

Until now, the argument about who should pay for installation of equipment has been a major stumbling block in Europe, while the US has marched ahead.

Such deals have been largely theoretical outside the US because the distributors, exhibitors and technology providers were unsure how much they would benefit from the new digital economics.

AAM chief executive Howard Kiedaisch told Screen Daily, those days may be drawing to a close.

"Up until now the discussions have been theoretical. But now we have something solid to offer exhibitors."

What remains open to question is whether exhibitors will sign up, though the participation of major studios is likely to make a difference, breaking another of the concerns of cinema owners about the availability of studio content.

AAM is engaged in active negotiations with other studios including Buena Vista International and Paramount Pictures International.

Kiedaisch said AAM's role as an integrator able to offer economies of scale took the pressure of individual exhibitors.

"Cinemas cannot take time to negotiate individually when they are focusing on their core business rather than equipment change. They should let us take the pain."

He said the deal was the result of around 18 months negotiations and for the first time represented a concrete deal for theatre owners

And he said he expected other studios to sign up in the near future. "This does not preclude another contract in future."

He said he hoped the deal would shift attention to the "real issue which is the opportunities that digital offers."

Julian Levin, Executive Vice President, Digital Exhibition and Non-Theatrical Sales and Distribution, Twentieth Century Fox echoed the theme that it was time for the digital cinema debate to shift attention to what it could offer customers: "The image quality, content, security and distribution/exhibition efficiencies, including 3D exhibition, offered by digital projection clearly exceeds 35mm film.

"We are delighted to have closed this arrangement with our colleagues at Arts Alliance Media who have the experience and technical expertise to manage this process."

And Duncan Clark, Executive Vice President of Universal Pictures International added:"The digital world is the future, and we as a studio are committed to its continual and sustained growth. We look forward to supplying our movies to this new digital platform and, along with audiences, reaping the rewards by continuing to enhance the theatrical experience."

http://www.screendaily.com/ScreenDailyArticle.aspx?intStoryID=33305&strSearc h=vpf&strCallingPage=ScreenDailySearchSite.aspx

Laggardly cinema at last starts to embrace digital - The silver screen is slowly changing from celluloid to digital prints

The Times

June 23, 2006

By Amanda Andrews

IN THE headlong rush to digital, cinema has lagged behind, at least until now. But a big push from film studios, distributors and the Film Council finally heralds the death of celluloid on the big screen and its replacement by digital technology.

It took the US film studios three years to agree on a standard digital cinema model — so as not to find themselves in a VHS versus Betamax or HD DVD versus Blu-ray scenario. But a decision was finally reached in July last year and a 200-page document compiled that set out the plan.

Cinemas have lagged behind other media, mainly because of the price of installing digital equipment. However, these costs have come down sharply, making a digital future more feasible than ever.

Howard Kiedaish, chief executive of Arts Alliance Media, a provider of film distribution services, says: “Not only is digital cinema visually better, but it is cheaper to produce and can be used time and time again without getting damaged, unlike the celluloid model.”

Mr Kiedaish has calculated that installing digital facilities at every UK screen, of which there are 3,486, would cost the industry about £60,000 per cinema, or £209.2 million in total. However, he says, it would take just five years for British cinemas to pay this off through the significant cost savings that would be achieved.

The average cost of a celluloid print is about £750, while a digital copy costs more like £125. Taking into account that there are 71,960 prints in Britain each year, Mr Kiedaish estimates the annual cost savings in this country alone to be almost £45 million.

However, more exciting to film-makers such as of George Lucas and Peter Jackson are the visual possibilities. No more will celluloid prints have to be passed from cinema to cinema, and get damaged on the way, ultimately affecting the clear, crisp picture necessary to give full visual impact.

“The quality of digital 3D cinema is far better than analogue. You don’t get sore eyes and it will be taken more seriously by film producers,” says Mr Kiedaish, adding that there is speculation that plans are being hatched to create 3D digital versions of Lord of The Rings and Star Wars in the next few years.

Digital could also change the day-to-day use of the cinema. Already the few digital cinemas that exist in the UK are showing live World Cup football because it is possible to plug a set-top box into a digital projector. But there are quirkier ideas on how the cinema could be used.

“A PlayStation 2, for example, could be plugged in to the digital projector, perhaps enabling mass competitions for children on a Saturday morning,” says Mr Kiedaish. “Belgian cinema chain Kinepolis has also used digital cinema to demonstrate an eye operation to trainee doctors.”

But it was one of these opportunities that provoked the Film Council to invest £11.5 million to convert 240 British cinemas to digital. The Film Council has different hopes of what it intends to achieve from its digital initiative.

It has signed a contract with a number of mainstream cinemas and will fund their conversion to digital in exchange for access to specialist films. With the lower cost of digital prints, cinemas can more readily afford to take risks and buy more arthouse films.

Meanwhile, the large cinema chains, such as Odeon and Vue, are in talks with the American studios to invest themselves.

The question is how fast the cinemas can get the necessary funding. As televisions get bigger and cheaper and DVD and video-on-demand release dates get closer to cinema release dates, cinemas need to start promoting themselves as striking multimedia experiences if they are to remain as popular as they were in the past.

http://business.timesonline.co.uk/tol/business/industry_sectors/media/article678005.ece

Cine Expo talking point: alternative means

Richard Brass in London 22 Jun 2007 00:00 Exhibitors struggle to find alternative revenue streams, reports Richard Brass.

For exhibitors it is the holy grail: how to maximise the use of all that expensive real estate by getting paying customers through the doors at off-peak times.

However, despite regular announcements of its imminent expansion, using cinemas for anything other than film screenings remains a fledgling ambition, and examples stand out more for their scarcity than for being part of a trend.

Vue Entertainment is taking a big step in that direction this month by broadcasting a live Genesis concert from Germany to its cinemas in the UK on June 27, offering 13,000 seats at prices ranging from $20-$50 (£10-£25).

Vue's sales and marketing director, Mark de Quervain, says "Music is just one area for us. We're also looking into sport and other areas as well. We see a good future in alternative content."

Vue's chief executive, Tim Richards, adds: "Our goal is to change our customers' perception of what a cinema is all about. We're trying to get them to think of it more as an entertainment centre and not just a venue to watch movies."

However, he says the alternative-usage possibilities of digital are being held back by the reluctance of US film studios to export the virtual print fee (VPF) funding model for digital to Europe.

"There are a couple of studios which have said definitively that the VPF model will not happen internationally. I respect that, but if there's not going to be a VPF model, what's the alternative? The alternative of silence is not constructive."

Cineworld chief executive Steve Wiener says the prospects for developing alternative uses are limited by the lack of anyone actually driving the supply side.

"We have 72 digital projectors installed right now, out of 753 screens, and they are greatly under-utilised," he says. "The biggest gap in our industry is that we need some professional hucksters out there who can pound the pavement and get the content."

Things are more advanced in both continental Europe and the US. Belgian chain Kinepolis has long led the way in alternative content in Europe, offering screenings of children's movies that would normally have gone straight to DVD, showing episodes of popular TV drama series, and even screening eye operations for the benefit of trainee surgeons.

However, beyond the pioneers, Karsten Grummitt of Dodona Research says that developing alternative usage demands a new marketing approach the cinema chains are not yet equipped to provide.

http://www.screendaily.com/ScreenDailyArticle.aspx?intStoryID=33270&strSearc h=vpf&strCallingPage=ScreenDailySearchSite.aspx

D-cinema steadily rolling out across Europe - Key to progress is cooperation

http://www.hollywoodreporter.com/hr/content_display/international/features/e3ie1d5fd3d6e69dbc7b83b33002fb25493

By Andreas Fuchs

June 19, 2007

When the president of the European cinema-support agency Media Salles makes a statement like, "Digital cinema will eventually send the traditional 35mm projector to the dump or to the science museum," you know the end of sprockets and celluloid must be at hand. But Jens Rykaer had more to say in a recent editorial to Media Salles members: "For almost two decades we have been discussing what has been characterized as the most revolutionary event in film since sound." Strong words indeed, but if the numbers found in Media Salles' 2006 European Cinema Yearbook are any indication, Rykaer's predictions aren't as bold as they might seem. After an 81% increase in digital installations during 2005, with another 383% growth recorded last year, the latest figures represent the highest adoption rate since the 1999 introduction of d-cinema. By regions, throughout 2006, Asia and Europe expanded by 70% to 347 and 168% to 531 screens, respectively, while North America gained a staggering 1,031% for a total of 2,866 screens globally. Elsewhere, Nancy Fares, business manager for DLP Cinema products at 2K chip manufacturer Texas Instruments, updates that year-end count of installations to 4,228 currently in commercial cinemas worldwide. As of mid-May 2007, European exhibitors had 652 digital screens in operation. "U.K. and Germany currently have the most DLP Cinema installations," she notes. "The trend is yet to be determined which country or exhibitor will lead the curve in going digital." Looking ahead, media consultancy Screen Digest, which will be presenting a new 3-D report at Cinema Expo, anticipates 1,181 Western European screens by the end of this year and 5,530 by 2010; in Central and Eastern Europe digital screen numbers should be 34 and 195 by those times, respectively. In North America, AccessIT Digital Cinema alone has completed some 2,600 screens of its 4,000-screen rollout and is financing the initiative in cooperation with projector manufacturer Christie. AccessIT's Media Services Group president Chuck Goldwater is equally confident that the company can "replicate internationally what we have successfully done domestically. European cinema operators are now where their U.S. colleagues were two years ago."

"Europe is a very diverse market, with differing exhibition and distribution landscapes and views on digital cinema," adds Fiona Deans, d-cinema director at U.K. agency Arts Alliance Media, which is overseeing a 10-screen trial for Norway's Film & Kino. In addition to the problems that come with dealing with a host of local and independent distributors, the European exhibition community is facing the same issues as its American counterpart -- most importantly, who exactly is going to pay for any widespread d-cinema implementation? Julian Levin, executive vp digital exhibition at 20th Century Fox, points out that his company already has closed various Virtual Print Fee arrangements in the U.S. in order to fund the rollout. He expects to make similar announcements in Europe and other areas of the world in the near future. "It is becoming increasingly important that exhibitors move quickly now and adopt a financing plan," he urges. "Fox's continuing financing support may not be around indefinitely." Options on the table include the possibility of third-party integrators and financiers footing the digital bill, along with exhibition-driven initiatives that could use contributions from screen advertisers. Institutional support is another model that has proven very effective in the U.K. Since the country's Digital Screen Network is publicly funded through the U.K. Film Council, Deans says exhibitors themselves have not had to invest significantly in the technology. "It's not a commercial rollout, and the funding is coming from the government," she says. "The understanding exhibitors have of the new technology, processes and management will stand them in great stead for the commercial rollout to come." All exhibitors interviewed for this report agreed that having all distributors onboard and manufacturers drop their prices are their biggest obstacles. Laura Fumagalli of Milan-based Arcadia multiplex calls the challenges "probably more diversified than the U.S. domestic market" and names "the availability of digital releases on a more constant basis" as a major concern. Lauge Nielsen, managing director of Amsterdam-based Pathe Theatres agrees: "Right now, it is sort of a Catch-22, (meaning) no hardware installed, no copies made available." By the same logic, the release of certain important titles can prompt a major surge. In the most recent case, 3-D-enabled digital installations grew to more than 700 for Buena Vista's recent animated release "Meet the Robinsons." In fact, the availability of digital 3-D has been described as the "killer app" by many in the industry. "It may well be," declares Brian Kercher, GM of Kodak Digital Cinema in Europe, Africa and the Middle East. "It's clearly popular with studios -- they have more 3-D movies in their plans -- and beneficial to exhibitors because (3-D) movies play longer and generate higher boxoffice and concession purchases." About half of the 80 Kodak systems installed worldwide -- 27 of which are located in eight cinemas in four European countries, including the very first in Greece at Village Cinemas -- are already equipped with Real D systems. In Germany, NuVision's reusable active shutter glasses have proven particularly successful with 15% of the country's 146 d-cinema screens, while Dolby Digital Cinema (which has more than 300 screens in 19 countries) is coming off a highly successful trial of its new 3-D system in the U.S. "3-D has demonstrated that it can pull in additional boxoffice for certain features," confirms Tom Cotton, vp business development of Technicolor Digital Cinema, Europe (which has 31 systems installed at Belgium's Kinepolis Group, using Barco projectors and Dolby d-cinema servers). "It has a strong marketing effect, creating demand for digital cinema. In this sense it is important. However, the benefits of digital in 2-D would be sufficient to warrant the switch-over once the economics have been established between exhibition and distribution." Going forward, industry veterans agree that the most important challenge facing the continued move to digital cinema is an understanding among all parties that in order for the transition to proceed smoothly, everyone must be on the same page. "It will take all the relevant stakeholders in distribution, including U.S. studios and local distributors, (along with) all exhibitors, first-run key locations, second-run and country location exhibitors," concludes 20th Century Fox executive vp digital exhibition Julian Levin. "(Everybody has) to actively engage, discuss and deal with each issue related to digital cinema and close the financing and modeling gaps in each situation and for every country." Despite the massive task, Levin isn't afraid to declare one much-needed digital certainty: "These discussions are substantially underway."

Heavy hitters bet big on 3-D

Plexes to upgrade with top directors

By PETER DEBRUGE

Posted: Fri., Jun.

15, 2007, 6:40pm Next summer, New Line plans to release 'Journey 3-D' on as many as 2,000 digital screens.

The future's so bright, you'll have to wear shades -- or polarized lenses, to be precise -- to appreciate the revolution in 3-D filmmaking.

Over the years, audiences have been jabbed in the eye often enough to be wary of the faddish, even gimmicky nature of 3-D, compounded in the past by headache-inducing red-blue anaglyph glasses. But this time around, the format is here to stay, say top execs from virtually every studio. Thanks to advances in digital projection, the picture looks crystal clear and supports, for the first time, the prospect of a wide 3-D release.

"I couldn't be more excited about it," says DreamWorks Animation topper Jeffrey Katzenberg, who recently announced the studio's intention to release every toon in 3-D, beginning with 2009's "Monsters vs. Aliens."

"I think it is the single most important transformational innovation that has occurred in the filmmaking business in 60 years, since color," he tells Variety. "To have spent all these years here, to see something come along that could literally transform your business and give you new opportunities -- creative, financial, just on every level -- is pretty amazing. It answers a critical issue about piracy and video windows."

Paramount, New Line, Disney, Sony, Warner and Fox all have major 3-D projects in the works. 3ality Digital's live-action "U2 3D" wowed auds at Cannes, where the market was buzzing with pitches for stereoscopic projects. And with helmers like James Cameron, Robert Zemeckis, Steven Spielberg, George Lucas, Peter Jackson and Robert Rodriguez sold on the format, exhibitors can rest assured that content from the industry's top innovators is on the way.

Content will drive conversion, first to digital projection, and then to 3-D with a simple upgrade offered by companies such as Real D or Dolby. For the digital 3-D releases of "Chicken Little," "The Nightmare Before Christmas" and "Meet the Robinsons," Disney helped push Real D installations in several hundred theaters. Those pics, in turn, delivered per-screen grosses two to three times those for "flat" 35mm presentations of the same film (aided by auds' willingness to pay premiums of up to 30% for tickets).

"It's just a matter of time before the tipping point for 3-D happens because, like anything else, if the content exists, the technology will come up to support it," says Buena Vista distribution prexy Chuck Viane.

By May 29, 2009, a date on which two 3-D films are currently scheduled to open wide -- "Monsters vs. Aliens" and Cameron's "Avatar" -- there should be at least 4,000 screens capable of projecting digital 3-D, estimates Real D chairman-CEO Michael Lewis. "3-D has sort of been the killer app of digital. As more and more of these films come out and we see them perform well, there's going to be an even bigger push to get more screens out there. So if the content keeps up, I think we'll see a lot more than 4,000."

That's a realistic estimate, explains Nancy Fares, business manager for Texas Instruments' DLP Cinema Products division, since there are already more than 4,000 DLP projectors in the market. "With the deployment happening today, potentially every single screen that is a DLP cinema can be 3-D enabled," she says.

In the meantime, Paramount hopes to release "Beowulf" on at least 1,000 screens in November, and New Line expects that number to double before "Journey 3-D" (the first live-action narrative feature shot in digital 3-D) opens in August 2008.

Walden, which produced "Journey," is fully committed to the format, which the company has been investigating since 2001, when co-founder Cary Granat first partnered with Cameron to produce two underwater docus, "Ghosts of the Abyss" and "Aliens of the Deep," as a way of exploring stereoscopic filmmaking.

"In fairness, there really hasn't been a film in the last 10 years that's been purposefully produced only as a 3-D film, versus films that have been converted to 3-D for select sequences and theaters, which is why we shot 'Journey' the way we did, with every scene in mind for fully immersing you in the frame," says Granat.

The 3-D format has a very bumpy history, and even though the polarization method (a major improvement over those red-blue lenses used for "Spy Kids 3-D") has existed for more than 70 years, the method's dependence on two projectors made it largely impractical.

For the past two decades, only Imax programmed polarized 3-D pics with any regularity, crossing over from special-interest docus to Hollywood tentpoles with "The Polar Express" in 2005.

The film earned $65 million in Imax 3-D and prompted the company to try the same approach with computer-animated "The Ant Bully" and "Open Season" as well as select live-action sequences from "Superman Returns" and "Harry Potter and the Order of the Phoenix." (To stay competitive, Imax will also upgrade to digital projectors, planning to switch from its current two-strip 70mm system in 2009.)

"When 'Polar Express' came out, I think we were a little euphoric, and we thought, 'Put it in 3-D, and they will come,'" says Imax co-chair and co-CEO Rich Gelfond. "Since then, our views have been refined a little bit, and we've learned it really has to be the right kind of project. It's not the magic bullet."

"You can't just start making 3-D movies on any script," agrees "Journey" producer Beau Flynn. "It really only works for sci-fi, fantasy, action."

But others are more optimistic. "It's going to be a lot broader than that," says Katzenberg. "If you look at the 500 movies released each year, you'll see pretty consistently that about 65 movies represent about 75% of the business. I went back and looked at the last three years using my own litmus test, and I think more than two-thirds of those 65 films would lend themselves to 3-D, so if you do the math, that's more than 50% of the business."

"The biggest thing about 3-D is education," says Buzz Hays, a senior producer on Sony Imageworks' 3-D stereoscopic pipeline. "Very few directors have any experience with it whatsoever, but if you get them to step away from the video monitor for a few seconds, the whole world is 3-D."

And even if the learning curve is steep at first, it's a new toy that's already attracted the business's top helmers. If Cameron can make it work with "Avatar," and Spielberg and Jackson are ready to try it on "Tintin," surely the rest of the industry will follow.

Based on technology already in development for home viewing, Granat forecasts another major innovation facing the theatrical 3-D experience.

"Eventually, what you're going to see is that you don't need glasses," he says. "That's probably about two years away."

Thomson's Technology Division and DLP predict it's farther off than that, but confirm the possibility.

In 3-D's bright future, maybe you won't need shades after all.

http://www.variety.com/article/VR1117967068.html?categoryid=2604&cs=1

ARTS ALLIANCE MEDIA OPENS SOUTHERN EUROPEAN OFFICE - GWENDAL AUFFRET APPOINTED AS MANAGING DIRECTOR

LONDON, 14 June, 2007 – Arts Alliance Media (AAM), Europe’s leading provider of digital distribution services, has announced the opening of a new office in Paris, which will be the headquarters of the company’s digital cinema operations for Southern Europe. The new office will cover territories including France, Italy, Spain and Portugal, and will support AAM’s European-wide commercial digital cinema rollout.

Gwendal Auffret has been appointed to lead the operations of the new base. Auffret, who was previously CEO of Éclair Digital Cinema, will work with a team based in Paris to coordinate installation and operation of DCI-compliant digital cinema equipment in cinemas across Southern Europe, as well as negotiating with distributors and exhibitors across the region. The base will provide local support and expertise for AAM’s planned future growth and expansion of operations, following the expected agreement of Virtual Print Fee (VPF) deals with studios and exhibitors.

Howard Kiedaisch, CEO of Arts Alliance Media, said “It’s great to be able to announce this big step forward in AAM’s pan-European digital cinema rollout, and we’re thrilled that we have someone as experienced in European digital cinema as Gwendal to run our new operation.”

Gwendal Auffret commented “Arts Alliance Media is a very forward thinking company which has all the cards in hand to really make digital cinema happen in Europe and I am delighted to be working as part of the team”

Auffret has been working in the digital cinema industry for many years, and has extensive experience of negotiating with studios, European distributors and exhibitors for the transition to digital cinema in France, Italy, Germany and Spain, and also forming strategic partnerships with manufacturers and service providers for deployment operations in Europe. Gwendal holds a Ph.D. in Computer Science from the Université de Technologie de Compiègne (UTC, France). He started out his career at the Forum des Images, were he was responsible for the digitization of a film archive (over 6700 films) and the modernization of the fully automated video consultation services.

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For more information, please contact:

Kate Pidgeon, Arts Alliance Media

kate@artsalliancemedia.com / +44 (0)20 7751 7512

Notes to Editors:

About Arts Alliance Media:

· Arts Alliance Media (AAM), based in London, is Europe's leading provider of digital film distribution services, dedicated to building a European digital network to deliver film to the cinema, to the home and between industry players.

· For digital cinema, AAM provides end-to-end digital cinema solutions encompassing equipment selection, financing and integration, operator training, installation and support, and content management and delivery.

· Arts Alliance Media has recently completed the installation of all 240 screens of the UK Film Council’s Digital Screen Network.

· AAM is participating in Odeon’s commercial digital cinema trial in the UK, and also operates a digital cinema circuit in Norway.

· For Download-to-Rent and Download-to-Own, AAM provides ISPs, media companies and e-tailers with turn key solutions for acquiring rights and securely distributing digital video content over the internet to their audiences, powered by the Vizumi Network.

· Arts Alliance Media has digital distribution deals with Universal Pictures, Sony, Warner Bros., Twentieth Century Fox, Momentum, Icon, Fremantle, Tartan, Discovery Networks, and Revolver Entertainment, amongst others.

· AAM owned LOVEFiLM.com, Europe's largest online DVD rental company, until the LOVEFiLM/Video Island merger in April 2006. AAM remains the largest single shareholder of LOVEFiLM International, the merged company, and provides the technology and content for digital distribution.

· For more information, visit: www.artsalliancemedia.com and www.vizumi.com

http://www.artsalliancemedia.com/Pressrelease-SEurope.html