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Give me digital, or give me death!

The latest challenge for the small, single-screen movie house…?

How to pay for conversion to a digital projection system…?

The century-old movie exhibition business is embracing digital technology with about 800-900 digital screens added nationwide EACH MONTH to both large and small theaters. The capabilities of the digital systems include 3D movies, the viewing of live sporting events and music events, and the presentation of sharper, scratch-free images.

Not only THAT, but “film prints,” the reels that are threaded through projectors, could become UNAVAILABLE by as early as 2013, according to the National Association of Theatre Owners!

But for many of the smaller theaters, the choice is “jump to digital” or die!

In an interesting symbiosis, the movie STUDIOS have been using the money that they save making “digital prints” ($100 to $200 per digital print, vs. $1,000 each for making and delivering a 35-mm film print) to help theaters convert to digital projectors! That funding is winding down, however. In the agreements with studios, exhibitors can qualify for funding ONLY if they install digital equipment by the end of next year.

Interestingly, (to ME, anyhow! :-) ), the distribution of new movies shows the earmarks of an old industry changing to new technology, but only embracing SOME of the new technology that is available: i.e., digital distribution typically involves the PHYSICAL SHIPMENT :-) of a hard-drive copy of a movie, shipped to a theater, where the drive is inserted into a server that operates the projection system!


More hopefully (and more informedly), :-) in some cases, movies are transmitted digitally by satellite! All these networks, and they are shipping by delivery truck!

John Fithian, the president of the National Association of Theatre Owners, told the annual convention in Las Vegas:

“Simply put, if you don’t make the decision to get on the digital train soon, you will be making the decision to get out of the business.”

In an interview, Fithian said:

“We’ve been telling exhibitors for four years that this is coming.” “We don’t want people to be left behind.”

At the same time that movie production by studios is “going digital,” studios are ALSO producing movies for home consumption soon after their theater debut, squeezing theater owners. Fears that studios will offer movies in the home just 60 days after the debut are also rampant.

So, what are the numbers?

Almost half of the 39,000 screens in the U.S. are digital, and by the end of the year, about 23,000 digital screens will have been installed. Most of the expansion is by the consortium of the three largest theater chains: AMC Entertainment Inc., Regal Entertainment Group, and Cinemark Holdings Inc. There are 650 theater companis in the U.S. and Canada with fewer than 100 screens; 270 of these have just one screen. Some of these don’t believe that film will disappear soon, and others just can’t afford the conversion to digital. Digital projectors and their computer hardware and software systems cost around $65,000/screen. Plus there is an additional $4,000 to $8,000 for the special silver screens required by some systems and about $10,000 to $20,000 more to buy 3D equipment!

Unfortunately, the upgrade comes at a time when box-office revenues and admissions have dropped more than 20%, from 2010 to 2011!

The article mentions several other alternatives for theater owners to finance the conversion. Chuck Goldwater, who is the president of Cinedigm’s media services group said:

“What we tell exhibitors is that the clock is ticking.”

-Bill at

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