Year 11 for Digital Cinema The Situation in the US Michael Karagosian February 2010 2010 MKPE Consulting LLC
Today s Discussion - Afternoon The Numbers Deployment Entities & Financing SMPTE DCP Transition ISDCF, CoMBI Anti-Piracy Efforts 2010 MKPE Consulting LLC 2
USA Screen Growth 8000 3-D is the driver! 7000 6000 3-D 5000 4000 3-D 2-D 3000 2-D 2000 1000 0 2008 2009 2010 MKPE Consulting LLC 3
DCIP Digital Cinema Implementation Partners AMC + Cinemark + Regal = 16,000 screens $700M bond will finance up to 10,000 screens Could take 2 to 3 years to install, after which 2 nd round of financing is needed 2010 MKPE Consulting LLC 4
Disappearing Deployment Entities 2010 MKPE Consulting LLC 5
Cinema Buying Group (CBG) Functionally a large circuit made up of independent cinema owners No deployment agreements Deployments by Cinedigm 2010 MKPE Consulting LLC 6
Deployment Deal Structure Virtual Print Fee (VPF) is paid per booking NOT pay per distribution NOT pay per play NOT pay per projector ALL distributors pay a VPF ALL screens in a complex must be converted Title remains with deployment entity or bank until recoupment ALL screens in plan must recoup before title is transferred Equipment must be warranted for 10 years 2010 MKPE Consulting LLC 7
Deployment Agreement vs Free Rider Objective of the deployment agreement is to enforce 100% conversion of screens in a complex Deployment agreements have benefits for studios: Ensures that competitors also pay Establishes when the VPF terminates Minimum standards for equipment Deployment agreements have benefits for deployment entities: One time fee negotiation Collateral for bank Free Rider is a distributor that has NOT entered into a deployment agreement 2010 MKPE Consulting LLC 8
Distributor VPF Cost Structure Cost neutral Everyone pays VPF revenue is audited 2010 MKPE Consulting LLC 9
Deployment Entity Balance Sheet Costs Revenues 2010 MKPE Consulting LLC 10
Why Deployment Entities? Shared equipment Competition law Everyone pays 2010 MKPE Consulting LLC 11
SMPTE SMPTE DCP Alternative Frame Rates Closed Captions Assistive Listening 2010 MKPE Consulting LLC 12
SMPTE DCP (Digital Cinema Package) DCI Compliance: SMPTE Picture SMPTE Subtitles SMPTE KDM SMPTE Audio SMPTE Closed Captions 2010 MKPE Consulting LLC 13
SMPTE DCP (Digital Cinema Package) Transition to SMPTE DCP distributions from Interop begins April 2010 Transition to complete in April 2011 Backwards compatible with Interop distributions Rigorous testing underway, resulting in several fixes to SMPTE DCP standards 2010 MKPE Consulting LLC 14
Accessibility Those with difficulty hearing Those who can t hear at all Those who cannot see, or see well 2010 MKPE Consulting LLC 15
Accessibility for Film Player Closed Caption System 2010 MKPE Consulting LLC 16
Accessibility for Digital Cinema Player Closed Caption System 2010 MKPE Consulting LLC 17
Digital Cinema Accessibility Those who can t hear at all Closed Captions (CC) SMPTE 428-10 DCDM Closed Captions SMPTE 429-12 DCP Closed Captions 2010 MKPE Consulting LLC 18
Digital Cinema Accessibility Those with difficulty hearing Hearing Impaired Audio (HI) SMPTE 429-2 DCP Operational Constraints 2010 MKPE Consulting LLC 19
Digital Cinema Accessibility Those who cannot see, or see well Visually Impaired Narrative (VI-N) SMPTE 429-2 DCP Operational Constraints 2010 MKPE Consulting LLC 20
SMPTE 428-2 DCP Constraints (& Audio) 2010 MKPE Consulting LLC 21
SMPTE 428-2 DCP Constraints (& Audio) 2010 MKPE Consulting LLC 22
SMPTE 429-12 DCP Caption and Closed Subtitle Open Subtitles Closed Subtitles Open Captions Closed Captions 2010 MKPE Consulting LLC 23
SMPTE CSP/RPL Output SMPTE 430-10 Aux Content Synchronization Protocol (CSP) Player SMPTE 430-11 Aux Resource Presentation List (RPL) Ethernet CSP / RPL Closed Caption System 2010 MKPE Consulting LLC 24
Putting It All Together WGBH Proprietary Protocol Rear Window Display Panel Light Reflector SMPTE Captions & Audio SMPTE CSP / RPL Protocol for Closed Captions IR or RF Access Audio Digital Cinema Server Controller / Transmitter IR Caption Glasses Hearing Impaired (HI) & Visually Impaired Narrative (VI-N) Audio 802.11 WiFi PDA 2010 MKPE Consulting LLC 25
Digital Cinema is Accessible 2010 MKPE Consulting LLC 26
ISDCF - Inter Society Digital Cinema Forum Not a standards body Discussion group for current problems and solutions Anyone can participate Meeting minutes are online http://isdcf.com 2010 MKPE Consulting LLC 27
TI Series 2 Not all servers can drive Series 2 projectors Cinelink 2 operates differently from Series 1 Secure communications between server and projector operate differently from Series 1 2010 MKPE Consulting LLC 28
Standards-Based Security Key Management 2010 MKPE Consulting LLC 29
Cinema Communication Message (CCM) Delivery of FLMs and KDMs Receipt of delivery Supports the concept of data intermediaries 2010 MKPE Consulting LLC 30
Common Media Block Interface (CoMBI) 2010 MKPE Consulting LLC 31
Anti-Piracy 2010 MKPE Consulting LLC 32
Solutions Technology Forensic marks Labor guards with night vision equipment ILLEGAL RECORDING Detection vs Jamming 2010 MKPE Consulting LLC 33
PirateEye Camcorder Detection 2010 MKPE Consulting LLC 34
http://report.mkpe.com Published Monthly On-Line Media Salles discount rate 1 st 10 days free Promotional code 736029 2010 MKPE Consulting LLC 35
Thank you http://report.mkpe.com Media Salles discount rate Promotional code 736029 Business Development for Entertainment Technology http://mkpe.com michael.karagosian@mkpe.com 2010 MKPE Consulting LLC