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LAS VEGAS — Premium Large Format could be the key to revenue growth in cinemas as technology continues to change the moviegoing experience, but it also means more competition in that space, according to an analyst from IHS Technology.
Speaking Monday at theater owners confab CinemaCon, David Hancock, IHS’ director of film and cinema, asserted that theater owners can market and monetize a premium experience not just with one new technology but a combination including 3D, immersive sound — and in the coming years, potentially laser projection.
“But because it’s successful it’s becoming crowded,” he warned of the market, citing new brands such as RealD’s Luxe, which was introduced last summer. Underscoring the growth of these brands, he noted that in 2012, 87 percent of Premium, Large Format auditoriums worldwide were Imax branded, but by 2013 that percentage dropped to 65 percent.
In all, 87 percent of the worlds 134,000 cinema screens are now digital, and roughly 15,000-16,000 auditoriums are still projecting film, he reported.
The lowest penetration of digital screens can be found in countries such as Venezuela, Egypt and Greece. Brazil—the host nation of the 2014 FIFA World Cup and 2016 Olympic Games–is still just below 50 percent converted to digital. Many insiders continue to question how many of these holdouts will go digital and how many will ultimately shut down.
Of those that are digital, roughly 53,000—nearly half—are now 3D capable.
“3D has survived the novelty phase” and is now becoming a “mature” part of cinema, Hancock said, adding that the issue is now about how the individual title resonates. He asserted that it’s no longer enough to put out a 3D version, and sometimes 3D isn’t released in all territories.
“It’s a choice like a film is a choice. It has to be perceived as having value in 3D,” he added, citing the success of titles conceived with 3D in mind, such as Gravity.
Julian Levin, executive vp digital exhibition and non-theatrical sales and distribution at 20th Century Fox International, noted that when digital cinema was planned, stakeholders wanted to create a non-proprietary platform that would enable theater owners to grown the market with new technology such as 3D. But he added that there are current challenges that need to be addressed, including developing standards for 3D subtitling, laser projection and for maintaining interoperability with emerging technologies such as immersive sound.
Looking further out, Jean Mizrahi, CEO of Paris-headquartered digital cinema technology firm Ymagis predicted that the “final stage of the digital transition” would include a model where more theater owners’ business, such as booking movies, is handled online.
To that end, he noted that his company is preparing to introduce an online catalog offering repertory movies as a sort of “content on demand” business.
On the future of distribution, he predicted Digital Cinema Distribution Coalition would be successful, saying its satellite delivery system for digital cinema content benefits large, wide releases. DCDC currently supports roughly 12,000 screens in North America.
Wrapping the morning session’s look at technology for cinema, a pair from Glasgow-based digital marketing firm Peach Digital emphasized that mobile commerce is growing fast.
Business development director Malcolm MacMillan noted that only about 34 percent of cinemas have developed services targeting mobile commerce, compared with an industry such as travel where 88 percent targets mobile traffic. He urged more theater owners to tap this area, for instance with services such as paperless and more effortless movie “check in.”
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