How to Revolutionize an Industry’s Technology
There's been a quiet but massive transition underway in the movie business. My daughter is a story editor for Bridezilla (a reality TV show) and the creative production industry has moved completely to digital, except the movie showing business. A cornerstone technology enabling the showing business to go digital is the [[DLP]] – digital light processor – platform from Texas Instruments which was designed in the TI facility just down the road from our former home in Allen TX. But the digital projector costs $70,000 for each screen.
As reported in the Wall Street Journal (subscription required), the cost of updating theatres to support digital products is about $70,000 per screen which has been the roadblock in any progress for some time. Distribution of digital products costs just pennies per print equivalent. There are only 5,000 of the 40,000 screens in North America capable of showing digital productions.
Five studios (Lion's Gate, Paramount Pictures, Universal, Disney and 20th Century Fox) have banded together with three major theatre chains (Regal, Cinemark, AMC) to create the Digital Cinema Implementation Partners which is arranging $1 billion financing package that will pay for these fundamental changes. To fund the transition, the studios are paying their savings of distribution (say $900/production unit) and the theaters use their revenues to pay back the loan for the equipment. Once the studios' share of the financing obligations are recovered, their distribution costs will fall to a few cents per equivalent print.
I wonder if there are access restrictions or higher costs for studios that aren't part of the DCIP such as Sony, Dreamworks etc?
This is the kind of producer-channel cooperation that enables truly transformative change in the underlying technology of the global movie business.
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