Wednesday, March 22, 2006

The State of Digital Cinema

From a DQ reader who wishes to remain anonymous (he obtained this information in an employed capacity and would like to stay that way), a detailed look at the current state of digital cinema. High-definition movies theaters could reverse the never-ending box office declines of the movie industry, but if you're wondering why more progress isn't being made, here's why.

As far as Digital Cinema goes, I'll give you the three word summary:

As far as digital cinema goes, right now, there are about seven players, all trying to get a foothold. In the end, you'll have three major players (just like everything else) - but I think that you may see some pretty big names not make the cut. You've got TI, Dolby, Kodak, Technicolor, Qube (big player in India, but a no-name in the states), Christie/AIX, and several others - everyone has their own take on things and what you can/can't do with the media and their projectors. Some require a specific projector, some don't care. Qube is in an interesting position as they've got about 160 developers & engineers in India working on hardware (PCI-Express boards, no less) that will allow you to stream in encrypted video into the board and then it will decrypt the video and then RE-ENCODE it and output it to a digital projector that has a key in it to decode it AGAIN. With so many players, everyone is scared to commit.

The studios are really pushing digital cinema, but they're also terrified that Joe Movie Hacker will be able to get the raw data and then make illegal copies of it, so they make all kinds of ridiculous requirements of the board manufacturers so that at NO POINT in the projection process is there a datastream exposed to software that isn't running in some chip that is on a board. On top of that, you have competing codecs - JPEG2000, Windows Media, MP4, etc...oh - your board/projector also has to watermark anything that runs thru it.

Beyond those issues, you have the distribution issues - right now, it costs about $1500 to produce a movie print on a can of 35mm film. The distributors ship the film cans (which weigh quite a bit) to the exhibitors which is quite spendy. With digital in its current form, you have distributors sending out Western Digital HD's to the various locations with digital projectors. Chicken Little was the last film that was really pushed onto the exhibitors as a digital film - so they're sending HD's out to theatre chains and then telling them where they can show it - and how often - and only giving certain terms on the actual film rental. So the theatre is stuck with a projector and digital media server that probably costs HUNDREDS of thousands of dollars and they really can't use it how they see fit - some guys feel that they should be able to charge a premium (usually $2/ticket) to see a film in its pure digital format...partially becuase of the better quality in picture and sound, and partially to recoup their investment in hardware, and partially to makeup for the shitty rental terms being forced on them by the studios. So now, you're paying $10+/ticket for a digital movie, but the HD's it is stored on aren't that great and you see about 1 in 6 HD's that either have corrupted data or won't even mount into the media system. On top of that, you can't really STREAM the movie off the HD - you have to upload it into the server and that process usually takes several hours. You also have issues with the theatres not getting the HD's in time to load them into the server before their first showing...At some point, they'd like to get to satellite distribution from a central location to the theatres, but that's a ways off.

Also, the exhibitor will probably be required to replace/repaint their screens, as you need a special paint & surface to ensure maxium picture clarity.

Depending on your media server setup, you'll have to have gigabit ethernet running from a central media server to your projectors, so you're going to have some pretty huge wiring costs, too.

Now, you have some of the big exhibitors saying that they're not going to spend the millions required to even put one digital projector in all of their theatres - they want the studios to subsidize it, but if the studios do that, they're gonna want more of the revenues. So you have that screwing things up as well.

Another issue is unions - in various states, the theatre Projectionists have unionized and they're concerned that digital projection will put them out of work, as all you do is plug a HD in either late at night or early in the morning - then at showtime, you push the PLAY button (which will probably be automated). Every 4-6 months, you'll have to focus the projector.

Oh - you also have various generation of projectors to choose from: 2k, 4k, and 8k - those are pixel counts of the projectors.
--2k looks nice, but not head and shoulders better than high end consumer stuff. Available now. Pricing seems to be $$$$.
--4k looks amazing. They're just now coming out and are quite expensive. Pricing: $$$$$$
--8k is THE SHIT and there's talk of it being able to do 3D stuff that wouldn't require glasses or something crazy like that - this is what everyone wants (even me), but the price is: $$$$$$$$$$$$$$$$.

Again, there's NO WAY a cheap ass theatre owner is going to pay big bucks for a 2k when he knows that 4k stuff is out now, he really wants an 8k projector, but he'd have to have outside help in getting one and that help will want a part of the box office action. But box office numbers aren't what they'd like to be due to bad movies and shortening DVD release windows.

On that note, there's been LOTS of talk of the studios actually wanting to start having longer windows between the theatrical release and the DVD release, as they've seen a HUGE drop in DVD sales. Which is another reason they're looking toward the next gen DVD to generate another spike in sales - hoping that people will re-build their libraries in the new format (which I don't think will happen).

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