Nordisk Film Biografer A/S
Strategy and views on Digital Cinema
by Jan Petersen, CTO/IT Manager, Nordisk Film Biografer
Nordisk Film Biografer A/S has
worked with digital cinema for the last three years, both as a concept
and as “work in progress”.
We believe that the conversion to digital
cinema is the largest operational and technological change to hit the
industry since the first “talkie” (The Jazz Singer) was released
The paradox is that the conversion is
both a big opportunity and a big threat to exhibitors large and small.
The big opportunity is the increased flexibility in both programming and
alternative content that must maintain and maybe even increase the stream
of revenue by opening our theatres to business events, attracting new
audiences to specialized performances, offering 3 D and making cinema
advertising more attractive.
The threat is that the equipment needed
for digital cinema is very expensive and has an estimated life span that’s
substantially lower than our current 35mm projection equipment.
This fact alone could be the death of
many cinemas since profit margin in most cinemas is smaller than the increase
in equipment costs for initial investment, maintenance and ongoing replacement/upgrading.
For the digital transition to be successful for exhibitors a viable business
plan has to be in place. The business plan should address in detail not
only the issues of the first transition but also provide for future upgrades
and replacement of the digital equipment.
If we look at the cinema industry as a whole the savings provided by digitalizing
the industry should be more than enough to finance the expenses for the
new equipment including future upgrades and replacements.
There is a huge saving in abandoning the distribution of 35mm copies,
a fact that international studios and distributors acknowledge.
Business models are in fact surfacing around the world but unfortunately
so far without addressing the long term effects of the transition to digital.
Besides a viable business model, smooth operational transition is
very important to our company. We believe that one of the key factors
for successful transition is the support from all employees especially
our group of IT-specialists, cinema technicians and projectionists and
we have provided extensive training for our technical staff including
attendance at DGT 2004 and 2005.
For these reasons we installed our first digital screens in 2004 and have
gained a lot of working experience with digital cinema as well as digital
media in general.
It is our strong belief that the initiatives taken are the best way for
an optimal and smooth transition into a world of digital cinema. A transition
that will happen sooner or later.
Our strategy for digital cinema is to pursue viable business while at
the same time, in cooperation with our partners, making sure that our
four installations meet the DCI requirements.