Saturday March 26, 2005 - Los Angeles Times - Business
Irish Movie Screens Going All-Digital
Avica Technology of Santa Monica will lead a project to convert 500 theaters at an estimated cost of $50 million.
From Associated Press
Although digital projectors have been slow in making their entrance into American movie theaters, Ireland is forging ahead to become the first country to convert all its movie theaters to digital projection.
Under a deal announced this week by the Irish Film Board, investors led by privately held Avica Technology Corp. of Santa Monica will convert 500 Irish movie screens to digital projection at an estimated cost of $50 million.
Separately, the British Film Council awarded a $22-million contract to privately held Arts Alliance Digital Cinema of London to install 250 digital screens this year.
Although the numbers in Ireland and England are small compared with the 36,000 movie screens in the U.S., the campaigns are aimed at Hollywood.
Seven major film studios working as the Digital Cinema Initiative have produced technical standards for digital projection but no business plan for sharing the savings.
Studios spend $750 million annually supplying copies of films to U.S. theaters and $1.5 billion for theaters elsewhere in the world. Distributing films by satellite could cut that bill in half.
But the problem of doing so without creating digital haves and have-nots among studios, theaters and distributors has stymied Hollywood. Weary of delays, technology firms are finding it easier to work abroad.
Digital cinema has been "struggling to get going for a number of years," said Nicholas Clay, Avica's chairman and chief executive. The company's hardware and software are used to distribute, store and manage digital content in about 100 theaters worldwide.
"It's no longer a technology issue," Clay said. "We've created a technical model and a business model and decided to demonstrate how it can be done by building a system and operating it ourselves."
Calling itself Digital Cinema Ltd. Ireland, a consortium of investors led by Avica will install the company's digital storage servers, players and management software along with digital projectors made by NEC Electronics Corp. of Japan. The projectors employ the digital light projection technology developed by Texas Instruments Inc.
In addition, Avica will build and operate a satellite distribution system to deliver content to theaters. Clay estimated that the total cost would approach $100,000 per screen. All of the equipment and procedures will comply with technical standards, including film encryption, set by Hollywood. Installations have begun, he said, and will be complete in 12 months.
Theater owners and film distributors will continue to do business as they do now, Clay said, but instead of shipping bulky film reels, distributors will turn to Avica to ship digital files to theaters for specific dates. Film studios will pay a "digital print fee" that Avica and its partners will share in proportion to their investment.
Clay wouldn't disclose the amount but said the digital fee was less than film print fees, which average $1,500 to $3,000 per copy.
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BBC-Irishcinema.pdf