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Monday, January 16, 2006

Universal Pictures' Michael Joe on digital cinema

The LA Times runs a fairly unsurprising Q&A today with Michael Joe, an executive VP at Universal Pictures. The focus is on the roll-out of digital cinema equipment to theaters in the U.S.

But there are a few interesting exchanges between Joe and LA Times reporter Julie Tamaki...

    Q: How long do you predict it will take for a nationwide roll-out of digital cinema?

    A: I think you'll start seeing meaningful installations in 2006. By the end of 2006, there will be somewhere between 500 and 1,000 digital cinema systems in the marketplace. There are 35,000 theater screens in America. We're probably looking at somewhere in the five- to 10-year timeframe before you'll see the vast majority of those screens converting to digital.

Joe also talks a bit about how new types of content (other than movies) might show up on digital screens... the big question is whether this content will come from movie studios or someone else (like the NBA, NFL, Broadway producers, etc). Joe says, "The other real advantage of digital cinema from the consumer perspective is that it allows the studios and filmmakers and exhibitors to potentially offer more, varied content and do things we haven't been able to do historically in a film-print world — things like making different versions of a movie available during the theatrical window. As an example, you could have a film that plays at 7 p.m. in a PG-rated version and then again at 10 p.m. in an R-rated version so you can make that film more accessible to a broader audience. It will be much easier to do things like allow directors to put their directors' cuts of their films in theaters [or] to potentially offer a movie with different endings."

He also admits that the cost savings from digital cinema are still kind of hazy - a point that a lot of stories on the topic gloss over. If studios are still paying "virtual print fees" to companies like Technicolor or Christie/AIX every time they send out a new film to theaters, how, exactly, are they saving money over the existing system of distributing celluloid prints?

    Q: By one estimate, digital distribution promises to save studios as much as $1 billion a year in the cost of making and distributing traditional film print. How much does Universal expect to save?

    A: It's hard to peg a specific number. I think we do believe the cost savings will be meaningful. We think it will be a lot less expensive to deliver movies to theaters digitally than it has been historically with film print. We think long-term, our post-production process and the process of getting a movie finalized and off to theaters will be a much more efficient process. But it's hard to say for sure what the real savings will be. It's really in a lot of respects going to be tied to how the cost of digital cinema systems evolves over time, how much does the pricing come down as more and more systems get ordered and installed and what is the life of the system.


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