26 Sep 2007 06:44
Despite growing evidence that digital cinema can offer greater choice that
the public wants, rollout in Europe in particular remains mired in an
impasse over payment and business models.
That was the message of this year's Screen International annual digital
cinema conference in London.
In his keynote speech, Bud Mayo, CEO of d-cinema pioneer Access IT, spelled
out what he believes is the irrefutable argument for new technology – that
it will boost off-peak admissions by offering more choice.
"Nobody is in a theatre for the most part Monday to Thursdays," he said.
"We believe that digital cinema, in addition to better sound and image
quality can enable those empty seats to be filled by providing many more
choices and scheduling possibilities."
Slow periods can be filled by alternative screening options for customers,
he suggested.
"Music concerts, sporting events ethnic and religious evcnts and lecture
series; these choices, live and pre-recorded, will expand dramatically over
the next few years."
"In fact any form of entertainment you find in an arena anywhere in the
world will find its way into your screens at off peak hours that are
attractive."
He believes a relatively small amount of supplementary activity to the core
film business could bring big results: A 1% increase in admissions in
Western Europe alone would mean $600m, he said.
The argument was backed up by other speakers, who offered case studies of
experiment in non-film content.
Mark de Quervain, sales and marketing director at UK cinema chain Vue. has
experimented with live concerts and is planning a comedy show.
"We are in a learning process, finding out what works and what does not."
The early efforts, such as a concert this year by veteran rock group
Genesis, pulled in customers but de Quervain conceded that it was a huge
effort to produce and it was not clear how future global releases would work
out.
He estimated that live events and other non-film activity would account for
between 1-3% of business.
The potential for charging a premium rate for such content remains one of
the more attractive promises of d-cinema, and again there are now proven
cases of customers willing to pay a premium rate.
Marc John, head of digital development at the UK's Picturehouse chain said
an opera season from the Met in New York had packed out theatres – both at
an initial $25 (£12.50) and the subsequent $50 (£25).
"People did not bat an eyelid at higher prices and cinemas said they not
only attracted usual cinemagoers but new people."
That public demand extends to a wider choice of film rather than simply
replacement of feature content.
Peter Buckingham, head of distribution and exhibition at the UK Film Council
said the recent experiment during the Summer Of British Film season had been
hugely successful.
The council helped put a series of restored classic films – including The
Dam Busters, Goldfinger and Brief Encounter in a wide range of cinemas
across the country and found audiences highly responsive.
"It proved that people want a wide choice of films on the big screen, even
if those films are available on DVD.
Most speakers estimated that alternative content to the current diet would
amount to between one and three per cent of their activity.
But such changes inevitably ask questions of the business model.
Despite evidence of benefits digital cinema remains mired in aguments over
who pays for installation that is already threatening some parts of the
industry.
Nicolette Homes, commercial director at Carlton Screen advertising, which
boasts a commanding market share in the UK, warned: "unless we go digital in
the next two to three years, I am not convinced we will still be in
business.
"To run half the estate digital and half in 35mm is not possible in any way.
We will just go bankrupt,"
Major business, she warned, wanted digital advertising but no one would
tolerate the costs of a half-digital, half-35mm solution.
What Homes' point illustrates is that the wider industry knows it cannot
stay where it is now, cannot support a halfway house and does not know if it
is possible to find an equitable solution to please all parties in the
future.
The conference heard that Germany is finding it hard to find a way to reach
agreement on a rollout plan that will achieve growth without losing smaller
cinemas.
Analyst David Hancock, of Screen Digest, said he feared the debate had led
to a damaging "politicisation" of the d-cinema issues in which tensions
between demands for fairness and the free market had become a real issue.
The most promising breakthrough in Europe seemed to have come earlier this
year when Arts Alliance Media (AAM), which announced a deal with Universal
Pictures International and Twentieth Century Fox on the most developed model
for sharing costs between distributors and exhibitors - the virtual print
fee.
Further deals will come, AAM CEO Howard Kiedaisch promised, saying it was
more a question of timing than underlying problems.
Julian Levin, evp digital exhibition, Fox Entertainment, said he understood
the issues around VPF but warned there was a limit to the patience of
studios for arguments that had led to what he called "organised chaos."
The current deals on the table needed to be taken up by exhibitors, he
suggested, or they could end up paying all the bill for digital benefits.
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