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At the Movies: Digital Delivery Takes Off, Part 1

It was a time-tested tactic during ancient Roman times for generals to embrace their adversaries and bring them into the fold when they represented significant threats to the Empire that they could not otherwise defend against.

A modern variation of this practice is becoming common across the media and communications landscape. Long-established industry leaders — telecom providers; TV, cable or radio network operators; and film studios and distributors — are increasingly embracing the profusion of emerging new digital media production and distribution technologies available in today’s fast-changing media markets.

This is certainly the case in Hollywood, where new digital technologies and tech-minded upstarts are shaking up the film industry. However, persistent controversy over digital rights management and ongoing piracy problems are pulling major studios, their distribution partners and cinema operators in the opposite direction, making it difficult for them to fully embrace the fast-moving and elusive digital demon.

Distributors and exhibitors may have a winner on their hands, though. Preliminary indications suggest that a new generation of digital production, distribution and projection technologies have enough of a wow factor to reel in audiences as never before and keep the film industry going strong for years to come.

Coming Soon to a Theater Near You

The momentum behind the digital distribution model is building toward a rapid growth phase in the U.S. and around the world.

“Digital cinema promises a new world of programming flexibility, picture quality and image consistency,” AMC Entertainment Group’s Sun Dee Larson told TechNewsWorld. “It is expected to expand alternative, nontraditional theater programming, ultimately providing more choice to moviegoers.”

AMC — along with Cinemark USA and the Regal Entertainment Group — is a member ofDigital Cinema Implementation Partners(DCIP), a consortium of cinema operators that has joined withUniversal Pictures and Warner Bros. to build out a nationwide digital cinema distribution network in the U.S.

So, how widespread are digital cinema platforms? “Not very,”Dodona Research analyst Karsten-Peter Grummit told TechNewsWorld.

“At the start of this year, the U.S. exhibitor Carmike accounted for approximately half of all installations worldwide,” he noted. “Until six months ago, it was possible to categorize all installations as ‘experimental.’ However, now serious deployment has started, we expect to see digital distribution become dominant in some territories within three to five years.”

By current count, there are only in the neighborhood of 3,000 digital cinemas in the U.S. and a little over 1,000 screens outside, according to DigDia research analyst Gary Sasaki. These are so-called 2K screens, he noted. “There are a few hundred more ‘digital screens’ if you count older 1.3K screens. 2K screens are the minimum resolution for conforming to digital cinema today: 1,080 x 2,048,” he explained.

That said, ongoing development, pilot tests and announcements such as the Universal, Warner, DCIP partnership indicate progress is likely to start accelerating sooner rather than later.

Even the paltry total of 3,000 U.S. screens “is somewhat remarkable, given that exhibition is a large, well established, and complex industry — and there were no digital screens just a few years ago,” Bob Mayson, general manager and vice-president ofKodak Digital Motion Imaging, told TechNewsWorld. “Now [that] the pace is increasing, a few companies — including Kodak — are gaining traction, and we expect continued growth.”

A Tripartite Alliance

On March 8, Universal, Warner Bros. and DCIP announced plans to build out a digital film distribution network that will enable the studios and their distribution arms to distribute films to DCIP member cinemas faster, cheaper and more securely than has ever been possible.

“The DCIP partnership will not only jump-start national distribution of digital cinema, but it will also accelerate wide-scale deployment,” AMC’s Larson said. “We are in the process of testing a variety of digital cinema equipment through our relationship with DCIP. When the testing is satisfactorily completed, DCIP plans to begin installation of digital cinema systems in exhibitor partners’ new build facilities, beginning in late 2007, and in existing locations on a market-by-market deployment beginning in early to mid-2008. Retrofitting theaters will take three to four years to complete.”

Digital Cinema Initiatives (DCI) is a key enabler in this process. Created in 2002, DCI is a joint venture of Disney, Fox, Paramount, Sony Pictures, Universal and Warner Bros. It says its primary purpose is “to establish and document voluntary specifications for an open architecture for digital cinema that ensures a uniform and high level of technical performance, reliability and quality.”

Earlier this month, DCI announced that it will work with CineCert to take the former’s digital cinema equipment compliance test program to its next and final level.

A Massive Undertaking

Such plans has been long in the making and for good reason — there’s a lot involved and some unique, difficult problems to overcome when you’re talking about beaming upwards of 50 gigabytes of digital data per film to cinemas nationwide, DigDia’s Sasaki noted.

Warner, Universal and DCIP’s undertaking is by no means the only film-to-cinema digital distribution network in the works, however, or even the most advanced in execution. AccessIT, Thomson-Technicolor, Kodak, Panasonic, and other digital film production and equipment manufacturers, as well as terrestrial and satellite communications network providers, are among those deeply involved in the process of assembling a new generation of digital distribution networks for the cinema film industry.

AccessIT (Access Integrated Technologies) earlier this month reported that as of April 30 it had completed 1.8 million digital showings on the more than 2,500 networked digital cinema systems it has installed in 30 states to date.

“Four years of in-house software development and testing, many millions of dollars in hardware, 24/7 support, real-life implementation and [continual] reworking,” have been invested in building out the satellite-based digital cinema delivery platform, Bud Mayo, the company’s president and CEO, told TechNewsWorld.

Technicolor Digital Cinema has a rollout plan that includes the installation of 5,000 DCI-compliant digital projection systems over the next three to four years, with a total rollout of 15,000 systems in the U.S. and Canada over the next decade. The company is also developing plans for a similar rollout in Europe.

Bearing Fruit

“These milestones demonstrate that we are solving critical issues for theater operators and that there’s no barrier — only advantages — for embracing digital. We’re well on our way to meeting our goal of 4,000 screens by the end of the year,” said Chuck Goldwater, president of AccessIT’s Media Services Group.

“In the entertainment industry, enduring changes need to meet technical, operational, creative and business needs, and the industry has been dealing with issues in all areas since digital cinema began in earnest in 1999,” noted Kodak’s Mayson.

“One issue that crosses several of those areas involves distribution. Today, most digital prints are delivered on hard drive — for several reasons, including the fact that satellite connections to theaters are not widely available,” he explained, “but, there are other reasons also. For example, a typical two-hour movie takes about 40-minutes to load into the server from a hard drive; it can take 16 hours to be received via satellite. So there are several challenges to deal with, but the industry is working at them and solving them — often creatively — one by one.”

At the Movies: Digital Delivery Takes Off, Part 2

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