Film-Tech Forum ARCHIVE: Is Regal still fighting with Hollywood on the digital roll out?

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Posted by Robert LaValley (Member # 4319) on 04-13-2008, 05:59 PM:

I heard that Regal has halted all digital installs due to some fight they are having with hollywood. Anyone hear anything on this?

Posted by Darryl Spicer (Member # 711) on 04-13-2008, 07:41 PM:

Since Regal is part of the Digital Cinema Initiative Project (DCIP) along with Cinemark and AMC. They probably halted any new installs until this group finalizes any deals with the film companies to help pay back the monies to DCIP's investors. Where this stands right now I am not sure but if all the film companies and the three major exhibitors agree to the terms an official announcement will be made and the roll out will start to begin. Last I heard nothing had been signed yet. Basically for DCIP to get the money from their investors they need a long term agreement with the film companies to help pay back the money. That would be with the film companies paying the exhibitors what it would cost to make a 35mm print if they played a digital print instead.

Posted by Mark Gulbrandsen (Member # 72) on 04-13-2008, 10:24 PM:

Actually Regal is rolling digital out now... just not retrofitting existing film gear to any extent. All new builds are fully digital and have been for the last year or so.

Mark

Posted by Mike Olpin (Member # 1115) on 04-14-2008, 01:17 AM:

When I last talked with Regal, around December, they were beginning their nationwide roll out, expected to take about 3 years. They will be rolling out one market area at a time. All new builds will be all digital, with film capability on some screens.

Posted by Jeffry L. Johnson (Member # 453) on 04-14-2008, 10:16 AM:

Digital Cinema Dispute in 3-D web page

quote:
Posted: Sun., Apr. 13, 2008, 9:00pm PT
Digital cinema dispute in 3-D
Studios, theater owners told to settle fee issues
By DAVID S. COHEN
NATO prexy John Fithian warned Sunday that the cinema industry is headed for "a potential train wreck" over 3-D if studios and theater owners do not settle their dispute over digital cinema fees in short order. And he noted that while heavyweights such as Jeffrey Katzenberg and James Cameron were early and ardent supporters of digital, key helmers like Steven Spielberg remain on the fence.
Fithian, in his keynote address to the Digital Cinema Summit at NAB in Las Vegas, noted that there are 10 major studio 3-D releases skedded for 2009, including DreamWorks Animation's "Monsters vs. Aliens" and Fox's Cameron opus "Avatar," but "we don't have the screens for them. We have less than 1,000 3-D screens in the U.S. and fewer than that in the rest of the world."

Yet negotiations between the studios and theater owners are at something of an impasse, said Fithian, as studios try to reduce the Virtual Print Fee that helps defray exhibitors' costs to install digital cinema systems.

"Unless the deals are done in the next month or two, we won't have time to do the installations in time," said Fithian, adding that manufacturing, integration and testing take time.

"We literally need the deals now to make the slate work. If the studios want this to happen in time for 2009, the deals have to be struck, and they have to be struck right now."

The hardtop org chief pointed to two major exhibitor groups that have yet to strike d-cinema deals: the Cinema Buying Group, which negotiates for some 8,000 independent screens; and Digital Cinema Implementation Partners, which is negotiating for some 14,000 Regal, AMC and Cinemark screens.

"The next two months are crucial" Fithian told Variety after his address. "If those deals get done, we have 22,000 screens and we're off and running. If they don't, we have a problem."

Fithian told the Digital Cinema Summit the essential elements for the transition to digital projection are now in place: uniform technical standards, high quality and working business models. Digital projection, he said, is now superior to film, though he conceded, "There are still a few who don't quite get it.

"You've all heard Jeffrey Katzenberg as one of the great priests of digital cinema. He and Jim Cameron have (done) more to push digital cinema than anyone else in the industry. But his partner Steven Spielberg is not convinced." Fithian said there is an ongoing struggle to get a full digital release for "Indiana Jones and the Kingdom of the Crystal Skull."

"If we haven't convinced Steven Spielberg yet, we're not quite done," Fithian said.

Read the full article at:
http://www.variety.com/article/VR1117983985.html

Posted by Darryl Spicer (Member # 711) on 04-14-2008, 12:10 PM:

I don't realy see that stopping the majors from at least getting more 3-D screens installed. It will slow them down on doing full conversions of complexes. I think the important thing is getting the 3-D screens up and ready then worry about getting the rest of the complexes switched over. The money is in the 3-D right now so that is first on the plate. The rest is gravy and can be added as you go.

Posted by David Zylstra (Member # 4230) on 04-14-2008, 12:45 PM:

The big money is in only in 3D when very few screens have it, once every theatre in town has it you lose any incremental attendance - granted there **may** be some overall increased attendance due to to 3D, but the increase ends up being spread across all local theatres.

Now if the studios put out films in 3D only then that is a different story, but again once every game in town can show 3D you are still left with your normal peice of the local pie and all you did by installing 3D was keeping your patrons coming back to you and not the competition.

If the majors install more and more 3D on their own dime the studios will have more of an excuse to drag their feet on VPFs.

Posted by Scott Norwood (Member # 30) on 04-14-2008, 12:47 PM:

Why do we need more 3D screens? Isn't it in the exhibitors' interest to have fewer screens, to have those screens consistently sell out, and to have movies with "legs"? With fewer screens, the 3D features will last longer and exhibitors will benefit from lower average per centages to be paid to the film distributors. Why would anyone here want more 3D screens, only to show titles that are played-out in a couple of weeks like most wide releses?

If I owned a theatre and spent big $$$ to install 3D DLP, I certainly wouldn't want the film distributors to eliminate my competitive advantage by subsidizing installs at my competition.

As I've posted elsewhere, Fithian always seems to come off as a know-nothing jerk in his articles and quotes. His comments above make him look pretty ignorant. As discussed in another thread, the DCI spec doesn't address 3D, and the SMPTE standard that is based on DCI does not exist yet. To state that technical standards for 3D DLP exhibition are in place is a blatant lie.

Posted by Bobby Henderson (Member # 840) on 04-14-2008, 01:39 PM:

quote: Scott Norwood
Why would anyone here want more 3D screens, only to show titles that are played-out in a couple of weeks like most wide releses?

Unfortunately it has nothing to do with what exhibitors want, much less what really works for their best interest. The situation only has to do with distributors getting what they want, even if it puts movie theaters in a less advantageous situation.

Since all movie distributors are essentially run with the bean counter mentality, they want any movie release to play itself out as fast as possible on as many screens as possible.

Manipulating a huge opening weekend gross has more to do with bragging rights. It equates to paying off more principal of borrowed money faster and paying back less interest. The distributors want the movie on home video as fast as possible for the same reasons, as well as having the movie's theatrical marketing push aiding in the home video marketing. Most movies are produced and marketed using a lot of borrowed money.

Sadly this business model doesn't have much room for a good, longer term theatrical release where a movie can play itself out over many weeks.

I think movie theaters have to redefine their relationship with movie studios because right now they are just getting screwed. The box office percentage scales are unfair. They're still modeled after the old system where movies with legs could play for months. IMHO, that system should be scrapped completely and go to a more fair, flat rate.

Posted by Scott Norwood (Member # 30) on 04-14-2008, 01:45 PM:

Yes, but why is the guy who supposedly represents the interest of exhibitors advocating for more 3D screens? That is what makes no sense to me. He can't possibly be _that_ clueless...can he?

Posted by James Westbrook (Member # 3690) on 04-14-2008, 02:40 PM:

I've been told one of the sticking points in the digital cinema roll-out is sub-run theatres: One chain wants to digitize these (Is that the right word?) and the film companies don't want to provide product to sub-runs, just only to first-runs.

Posted by Lyle Romer (Member # 1266) on 04-14-2008, 03:06 PM:

quote: Bobby Henderson
IMHO, that system should be scrapped completely and go to a more fair, flat rate.

Many releases are done by flat rate (referred to as aggregate percentage) now either by exhibitor choice or studio demand. How fair the rate is can be debated.

quote: James Westbrook
I've been told one of the sticking points in the digital cinema roll-out is sub-run theatres: One chain wants to digitize these (Is that the right word?) and the film companies don't want to provide product to sub-runs, just only to first-runs.

I don't think the issue is not providing product to sub runs. I'm sure the issue is that studios don't want to pay virtual print fees to finance the conversion of sub runs. Right now it doesn't cost the studio to provide product to sub runs since the print comes from another theater. If they paid VPFs to digital sub runs the studio will be paying for the same "print" twice.

Posted by Todd McCracken (Member # 4718) on 04-14-2008, 05:07 PM:

I think they are just trying to decide on who they will have integrate their equipment at this point.

Posted by Jack Ondracek (Member # 1466) on 04-14-2008, 07:22 PM:

I still wonder about the RealD annual per-screen license, assuming it's still in effect. Given how tight theatre operators are, is 3D so awesome that they'll all gladly pay the fee? If that, plus the annual digital maintenance cost applies, none of which a film theatre has to pay, where does the industry think all this money will come from?

Posted by Brad Allen (Member # 470) on 04-14-2008, 08:15 PM:

quote: Bobby Henderson
Unfortunately it has nothing to do with what exhibitors want, much less what really works for their best interest. The situation only has to do with distributors getting what they want, even if it puts movie theaters in a less advantageous situation.

Since all movie distributors are essentially run with the bean counter mentality, they want any movie release to play itself out as fast as possible on as many screens as possible.

Manipulating a huge opening weekend gross has more to do with bragging rights. It equates to paying off more principal of borrowed money faster and paying back less interest. The distributors want the movie on home video as fast as possible for the same reasons, as well as having the movie's theatrical marketing push aiding in the home video marketing. Most movies are produced and marketed using a lot of borrowed money.

Sadly this business model doesn't have much room for a good, longer term theatrical release where a movie can play itself out over many weeks.

I think movie theaters have to redefine their relationship with movie studios because right now they are just getting screwed. The box office percentage scales are unfair. They're still modeled after the old system where movies with legs could play for months. IMHO, that system should be scrapped completely and go to a more fair, flat rate

Your exactly right Bobby. But most of the film co's have gone to the flat aggregate rental's. That takes away all incentive for a theatre to hold a film as long as it would have under the old sliding scale system. If your paying 52% the first week and the same 52% the six week, what's the point.

Posted by David Zylstra (Member # 4230) on 04-14-2008, 10:05 PM:

quote: Jack Ondracek
I still wonder about the RealD annual per-screen license, assuming it's still in effect.

It is . . . . . . they have a few options, 1 is a per ticket revenue share so there is minimal up front costs but you are stuck paying them royalties.

We are happy with our decision to go with 3D (mainly because of the business Hannah Montana brought in) . . . we'll see what happens long term.

Posted by Mike Blakesley (Member # 26) on 04-15-2008, 12:59 AM:

quote: Scott Norwood
why is the guy who supposedly represents the interest of exhibitors advocating for more 3D screens?

I think he's more decrying the number of 3D movies being shoved out vs. the number of screens capable of playing them. It's going to be a train wreck if more screens aren't installed, so he's saying to the film co's, if you want to put this much 3D crap out, you'd better help make sure there's somewhere to play the stuff.

Personally I'm sad to see all the animation companies jumping on the "all future releases will be in 3-D" bandwagon. It's going to cut down on the number of animated films we play, for sure...until we get some 3D gear or the fad dies out, whichever happens in the end. Probably the latter.

Posted by James Westbrook (Member # 3690) on 04-15-2008, 01:14 AM:

3-D is a fad that will not go away. It seems generational. "Why don't we release some crap in 3-D?" "Okay."
Later after the first 2 releases sell like gangbusters to the new audience, the newer 3-D releases tank. The newer generation discovered watching these movies give them headaches and don't want anything to do with it anymore.
20 years later...
"Why don't we release some crap in 3-D?" "Okay."

Posted by Darryl Spicer (Member # 711) on 04-15-2008, 01:17 AM:

Nothings to say you can't do a 2-D release of a 3-D animated feature.

Posted by Scott Norwood (Member # 30) on 04-15-2008, 03:51 AM:

I guess I just don't understand how it would be a train wreck to have a number of 3D releases competing for space on (say) 2000 screens. The result would just be that the films (TV shows) would play out over a longer period of time and that viewers in some markets might have to wait a bit before they get to see some titles.

I'm not sure how that is really a problem for exhibitors. If I had a 3D equipped cinema, I'd prefer that situation over having every screen in town equipped for 3D (in which case the competitive advantage of 3D would be lost).

I'm also not even sure why the extra costs for 3D should be subsidized by the film companies. This is (in theory, at least) an upgrade or a change in capability that actually has the potential to increaes ticket sales, not simply a replacement technology that is designed to save money for the film distributors. If it brings in extra cash for the exhibitors, then why shouldn't the exhibitors pay for it? (I'm not referring to the base cost of a DLP installation here...just the additional cost of making the installation 3D-capable.)

Posted by Louis Bornwasser (Member # 3063) on 04-15-2008, 09:12 AM:

Eliminate the glasses and you will even get me on the 3D bandwagon. Louis

Posted by Lyle Romer (Member # 1266) on 04-15-2008, 10:03 AM:

quote: Scott Norwood
I'm also not even sure why the extra costs for 3D should be subsidized by the film companies.

I don't think anybody is suggesting that the studios subsidize 3D. The argument is that they need to subsidize the D-Cinema installations quickly so the base system can be installed for the exhibitor to upgrade to 3D.

Posted by Mike Blakesley (Member # 26) on 04-15-2008, 10:04 AM:

^^^ Louis, my feelings exactly.

quote: Darryl Spicer
Nothings to say you can't do a 2-D release of a 3-D animated feature.

That's true but if the biggest draw about the movie is the 3-D, then the major appeal of the movie is lost if you're not playing it in 3-D. A good Pixar movie will be a good draw no matter what, but even then if all the advertising is screaming "3-D!" any 2-D theatre is going to be dealing with disappointed customers.

Posted by Todd McCracken (Member # 4718) on 04-17-2008, 04:09 PM:

In regards to the digital 3D screens most sites have one, and it is integrated seperately from the larger digital conversion. So TDC or Christie/AIX for example may do the larger integration at a site but one screen will have 2 players, one integrated by the 3D provider the rest by whoever is doing the roll out. If there is a hold up I feel that 3D has little to do with it.

Posted by Mark Gulbrandsen (Member # 72) on 04-17-2008, 08:18 PM:

Real-D is offering CBG members a special deal on their system... Don't know if its a lease or purchase but its at a very, very good price. I know of several more going in as a result.

Mark

Posted by Steve Guttag (Member # 268) on 04-18-2008, 07:11 AM:

Dolby has a pretty good sale on through the end of April on their 3D (and you own it once you get it...no continued payments as with Real-D). Dolby's glasses have also taken a permanent lowering in price...still expensive but about $10/pr less than a couple of months ago.

Steve

Posted by Bobby Henderson (Member # 840) on 04-18-2008, 09:37 AM:

What's going to be the next 3D movie release? Coraline, Journey 3D or perhaps something else?

The new Moore Warren theater south of Oklahoma City has at least three Dolby 3D systems installed (according to Moore Monthly magazine). If a decent movie gets released in 3D I may drive up I-44 to check out the 3D there. I'm wanting May and its big movies to get here already so I can visit that theater anyway.