XDC signs four Studios to European d-cinema deployment deal

http://www.screendigest.com/online_services/intelligence/cinema/updates/ci-080523-DH/view.html#

 

Author/s  -  David Hancock

 

Published: 23-May-08

European digital cinema facilitator XDC has signed four studios to its digital cinema rollout plan, under which those studios will contribute temporarily to financing the roll-out and commit to providing their content on a non-exclusive basis to cinemas signed up through XDC. Agreements are valid for 8,000 screens across Europe, including UK, and puts in context XDC's announcement last month that it has signed a marketing, installation and training deal with UK company Sound Associates. Studios involved are Warner Bros, Paramount Pictures, Twentieth Century-Fox and Walt Disney. According to XDC, agreements with the other two studios, Sony Pictures and Universal Pictures, should be signed shortly. The installations under roll-out will be 3D ready. XDC has also recently established an alternative content venture called DDCinema, in common with all the major d-cinema deployment providers. Unlike in USA, screen advertising has not yet become an integral part of the digital cinema plan although CEO of XDC is a one-time senior executive of Europeran screen advertising group Screenvision. XDC expects the DCI-standard deployment to begin within next 12 months.

 

Our take...

There are number of interesting and highly significant layers to this announcement. In itself this is highly significant as it ends the deadlock in rolling out d-cinema in Europe. When only Arts Alliance was in the market with a studio-backed VPF deal, which the XDC one is a variation of, they may have suffered from being alone and this gave exhibitors an excuse not to take it up. In a way, the strength of the AAM plan was irrelevant as a lack of choice signalled to exhibitors that the decision wasn't imminent and there was no comparable offer. The market as a whole is strengthened by this announcement, which brings the number of screens eventually under a studio-backed deal to 15,000, or slightly over half of Western European screens.

It is also significant that both providers are credible players, with Arts Alliance having cut its teeth with the UKFC Digital Screen Network and XDC a long-time provider of digital cinema within Europe. This is also the first signed deployment deal for Warner Bros International. This agreement may still not solve the issue of marginal screens, which is still the area of most interest to governments and supra-national organsiations around Europe.

There are also interesting signs of divergence with the language and terms being employed between the USA and Europe. The XDC agreement does not reference specifically a VPF deal, but talks about a contribution to the financing of d-cinema rollout. This also occurred during the Arts Alliance deal and suggests that XDC has estimated that the negative perceptions of the word VPF in Europe outweigh the clarity of the shorthand. However, the VPF is simply a mechanism to contribute directly to a digital switchover and in a way is immaterial. What is important is that both XDC and Arts Alliance have studio-backed deployment deals (SBDs?) and that guarantees content for exhibitors. Secondly, the deal is considered 'temporary' and not a long-term deal. This is in contrast to the US deals still being done (such as Lionsgate's recent announcement of a 10 year VPF agreed with AccessIT) and suggests that the studios are playing a different game in Europe with regard to the length of their commitment.