Trib. Milano n. 418 del 02.07.2007
International Edition No. 38 - year 3
A variety of business models for the digital transition
In the last number of the DGT online informer, in the editorial by Jens Rykaer and in Nancy Fares’ testimony, there were several mentions of the theme of the business model - or rather, business models - that should consent a transition over to the digital system that is as homogeneous as possible, in terms both of timing and the quantity of screens involved. All members of the cinema community know that maintaining a double distribution mode - analogue and digital – is a weight that the industry cannot support for long. Equally so, we are aware of the risk implied by a process of transformation that creates a divide between those who can afford it and all those who would remain excluded. Because of this, lately, not only has the debate intensified about the economics of digital cinema, but there has also been an increase in the number of projects that aim to realise a virtuous balance between the savings that the new technology promises in the field of distribution and the investments that it requires in the exhibition sector. In this number we spotlight the Norwegian initiative, and in the coming editions we will continue to discuss what is happening in other countries, on both sides of the ocean. The goal is to understand what are the directions that can be taken in order to maintain clear relations between distribution and exhibition that allows both to share both the duties and advantages of the system and also to conserve the freedom of the specifics subjects involved, in terms, for example, of the acquisition of the products to propose to the public, whether they are films or alternative contents. I would hope therefore that there would be a variety of solutions, based upon both direct investment on behalf of the exhibitors and with the intervention of third parties, that provides a climate of trust to the exhibitors involved in an epochal change in the history of cinemas.
Digital technology will bring innovation to traditional advertising tools
“Release dates in line with those of TV, a drastic reduction in the cost of producing material, the opportunity to calibrate the campaign according to the target, the genre and the film: these are the advantages that the world of advertising expects from the spread of digital projectors in cinemas. A technological revolution which, from the point of view of professional advertising, represents an important innovation in a traditional tool, similar to what is happening in terms of posters, where paper is being replaced by digital screens.” This is what Paolo Duranti, Managing Director of Nielsen Media Research for Southern Europe, has to say when commenting on the data supplied by MEDIA Salles on the situation of digital projection worldwide which, at the end of 2007, was available in a little under 6,000 screens equipped with DLP Cinema or Sony 4K technology.
During the annual meeting with the members of the International Advertising Association, which took place on 20 June at the Catholic University of Milan, Duranti, who also predicts a market growth in advertising of around 2.6% in Italy, expressed cautious optimism as regards the trend of spending on the big screen in Italy in 2008. The year should close with a 0.9% increase, after a 2007 which suffered from an 8.4% drop, due also to the disappearance of some advertising agencies and to the consequent reorganisation of the market.
XDC is the Belgium-based company created by the EVS group and operating in several European countries to act as integrator in the cinemas’ transition to digital technology, by proposing solutions that aim on the one hand to boost the availability of digital content and on the other to finance technological innovations. Many will recall the proposal made some years ago: the installation of an electronic or digital system on the basis of a sort of a monthly fee to be paid by the exhibitor.
XDC has recently started a new phase: at the closure of the Cannes Festival, the company announced that a non-exclusive agreement, along the lines of the Virtual Print Fee, had been reached with four studios to finance the adoption of DCI compliant digital systems on 8,000 European screens. A similar announcement followed a month later, concerning the agreement with Sony Pictures and Universal.
The six major US distributors agree on
the one hand to make their digital content available for the European
market and, on the other, to allow XDC a contribution proportional to
the amount they will save by distributing their films in digital format
instead of on 35mm.
Digital cinema the Norwegian way: immediately and for everyone. The project backed by the Norwegian Government presented at a seminar in Kristiansand
Small but fast. This is how the
Norwegian market’s shift to digital might be defined, according to
the information emerging from the international seminar organized
at Kristiansand by Norgesfilm and by Nordic Digital Alliance. In a
country of four and a half million inhabitants, who buy around 12
million tickets a year in their 230 cinemas, most of which are owned
by the municipalities, the digital adventure had already begun in
2001, with advertising on the big screen shifting to the electronic
format. The adventure continued with the launch of two trials, run
in 2006, based on a total of 33 fixed digital projection systems and
one mobile one. These experiments were conducted on the one hand by
Nordic – Norway’s Digital Operability in Cinema – a consortium in
which the participants were, amongst others, the University of Trondheim
and Unique Digital, the company responsible for digitalisation of
advertising – and, on the other hand, NDA – Nordic Digital Alliance.
The latter organization counts amongst its owners Arts Alliance Media,
based in London but with a Norwegian founder – Thomas Hoegh –, and
the cinema in Kristiansand, one of the big 7 on the Norwegian market.
Today in Norway digital screens have reached a total of 40 (two of
which have Sony 4K technology) out of an overall 440, thanks also
to the private initiative of the cinemas in Bergen (4 screens) and
Lillehammer, with a projector financed by the national film library.
But the Norwegian recipe for digital would not be complete without
a basic ingredient, which is Film&Kino, the organization that
brings together the Country’s municipal cinemas and collects, on behalf
of the Government, the tax on cinema tickets (about 2.5% of ticket
price) and on DVDs, which brings in approximately 10 million euros
a year, destined for the Norwegian Cinema & Film Fund.
The Italian version of this article was published in the Giornale dello Spettacolo dated 4 July 2008 that was circulated on the occasion of the Cinema Professional Day devoted to digital projection - Rome, 8 July 2008.
The calendar of the 3D releases in the US
* to be released every year before Halloween
New MEDIA Salles offices
On 30 June 2007 MEDIA Salles relocated
its offices to the Milan headquarters of Agis, Italy’s entertainment