Status of Digital Cinema
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- Camron Dawson
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1 Leading Depth Leading Innovators Leading Thinkers Leading Experience Software Council Panel Discussion 10/23/2003 1
2 The Promise Technicolor (TDC) Planned to seed 1,000 installations (1) 2
3 The Promise Technicolor (TDC) Planned to seed 1,000 installations (1) Star Wars Episode II: Attack of the Clones 60 US digital screens out of 5,000 (1) 6 digital films at Cannes (1) 3
4 The Promise Technicolor (TDC) Planned to seed 1,000 installations (1) Star Wars Episode II: Attack of the Clones 60 US digital screens out of 5,000 (1) 6 digital films at Cannes (1) WW D-Cinema installations (1 & 2) 80+ digital films released to date (1) But maybe there s a market for films in different digital form: 500,000 digital movies exchanged on the web (3) 2-hr movie encoded at 750KB fits on a standard CD (3) 4 movies encoded in MPEG2 fit on a standard DVD (3) Also, digital infrastructure is finding it s way into theatres 4,000 WW low-end plasma displays for advertising in 400 theaters (1) 4
5 The Promise Technicolor (TDC) Planned to seed 1,000 installations (1) Star Wars Episode II: Attack of the Clones 60 US digital screens out of 5,000 (1) 6 digital films at Cannes (1) WW D-Cinema installations (1 & 2) 80+ digital films released to date (1) But maybe there s a market for films in different digital form: 500,000 digital movies exchanged on the web (3) 2-hr movie encoded at 750KB fits on a standard CD (3) 4 movies encoded in MPEG2 fit on a standard DVD (3) Also, digital infrastructure is finding it s way into theatres 4,000 WW low-end plasma displays for advertising in 400 theaters (1) 2004 Only 11 confirmed digital film releases scheduled (3 live action) (1) 5
6 The Business Issues Theater Owner Issues - No clamouring customers $5B-$7B to upgrade 36,000 US screens (2) $100K-$150K per screen; $2.4M- $3.6M per 24-plex (1) Upgrade is not a 1-time cost vs. life of projector: (1) - Ongoing maintenance and staff of computer-based servers - Server obsolescence and replacement Not enough titles means equipment sits idle 6
7 The Business Issues Theater Owner Issues - No clamouring customers $5B-$7B to upgrade 36,000 US screens (2) $100K-$150K per screen; $2.4M- $3.6M per 24-plex (1) Upgrade is not a 1-time cost vs. life of projector: (1) - Ongoing maintenance and staff of computer-based servers - Server obsolescence and replacement Not enough titles means equipment sits idle Distributor Issues - Potential $800M decrease in annual print business over time (1) Status of players (1): Technicolor TDC Qualcomm Boeing 7
8 The Business Issues Theatre Owner Issues - No clamouring customers $5B-$7B to upgrade 36,000 US screens (2) $100K-$150K per screen; $2.4M- $3.6M per 24-plex (1) Upgrade is not a 1-time cost vs. life of projector: (1) - Ongoing maintenance and staff of computer-based servers - Server obsolescence and replacement Not enough titles means equipment sits idle Distributor Issues - Potential $800M decrease in annual print business over time (1) Status of players (1): Technicolor TDC Qualcomm Boeing Studio Issues $26K per screen savings potential (1) Competing formats mean multiple masters Compression: Standard or Proprietary? (1) Resolution: 2K or 4K? ITU wants HDTV at 1.9K (1) Standards Bodies: SMPTE or DCI? (1) Vendors: TI, Barco, NEC, Sony, Kodak, (1) Indies can t afford $100K per title mastering cost Piracy of digital products -- $3B in piracy losses of physical media annually (MPAA) ,000 digital movies exchanged on the web (3) discs per site for 100 min. movie (1) millionth download of Kazaa Media Desktop (KMD) on 3/11/2003 8
9 Potential Drivers Theatre Owner Opportunities - Maximize popular movies on more screens with flexibility (1&4) Distributors offer equipment and services, rather than theatres investment (1&4) Alternate uses and revenue streams: sports, concerts, educational and business events, niche film festivals, niche advertising (1 & 4) Distributor Opportunities - Potential digital media storage and distribution services (1&4)) Simultaneous releases (1&4) Can then handle 15,000-screen simultaneous release with film (1) Studio Opportunities - Reduce $800M on prints, rejuvenation and redistribution of film (1) Maximize popular movies on more screens with flexibility (1&4) With more digital intermediates, the cost of mastering can go down (1) With more advertising-driven infrastructure, more theatres will have networks in their facilities (1&4) Indies have alternatives: Lower res. outlets, online downloads, CDs/DVD mastering at lower costs (4) Piracy of digital products -- More mature role for DRM, watermarking, forensics (4) 9
10 10
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