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Avatar Boosts Digital Cinema Build-Out

If the recession slowed the adoption of digital cinema systems, no one's complaining now. There are thousands of Digital Cinema Initiative-compliant DLP projectors installed in North America.


The ArcLight Hollywood Cinerama Dome uses NEC's DCI-compliant digital cinema 3D projectors.

Credit: Courtesy Arclight

According to the "large display Report on e-Cinema," conducted by Insight Media, there are 8,007 Digital Cinema Initiative (DCI)-compliant DLP projectors installed in North America, 3,717 of which are 3D-enabled and 118 that are displaying movies on IMAX digital screens. Barco announced 2009 was the best year on record for its digital cinema business. Christie last month announced an order of 100 4K-resolution digital cinema projectors by Sonic Equipment Co., which works with movie theaters to upgrade their technology. If the recent recession slowed the adoption of digital cinema systems, no one's complaining now.

"We can thank James Cameron for coming out with Avatar," says Jim Reisteter, general manager of NEC's Digital Cinema Division. "3D cinema has just exploded. We saw a pretty significant spike late last November/early December, but once Avatar hit in December, it turned into a torrent."

Several studios now plan to release 3D versions of highly anticipated movies, such as Clash of the Titans and the first of the two-part Harry Potter and the Deathly Hallows, due out in summer 2010. And no theater wants to be left behind.

Of course, new 3D movies aren't available in nondigital format, forcing theaters to upgrade their systems if they want to cash in on the trend. But a bottleneck of qualified installers, sufficient components, and required screens–not to mention the financing to do it all–may put a wrench in things. Executives for NEC and Christie recently told Reuters they are struggling to get the supplies they need to keep up with demand.

"The question that remains is whether the supply chain can keep pace with the demand for component parts as quickly as Christie can meet the demand for projectors," Ihor Stech, vice president of operations for Christie, told the news agency.

Part of the backlog can be attributed to intellectual property management. Only NEC, Barco, Christie, and Sony carry a license from DCI, which is required to project first-run Hollywood films. And DCI-compliant projectors require a certain amount of training, even though they're similar to other models.

A goal of DCI from the start has been to prevent the pirating of Hollywood films. "There are many security features built into the [DCI-compliant] projector. You can't just open the panel and start working,"says Reisteter. Barco and NEC offer training, which can include the IT know-how necessary for tasks such as tying the DCI projector into a Theater Management System network.

DCI projectors and components are also more expensive than noncompliant models. "If you're dealing with an $8,000 prism instead of a $2,000 prism, you want to be careful in how it's handled," Reisteter explains. DCI-compliant projectors run $35,000 to $45,000, making theater owners think twice about upgrading. NEC's finance company, DC Financial, offers financing to anyone installing digital cinema products. But more help may be in sight: The Digital Cinema Implementation Partners–a joint venture of AMC Entertainment, Cinemark Holdings, and Regal Entertainment Group–announced in March a $660 million financing plan for deploying digital projection to nearly 14,000 North American screens over the next few years.

Additionally, several 3D projectors, particularly those using RealD 3D technology, require special silver screens, for which there is currently a backlog. Grant Stewart, president of Stewart Filmscreen, says details of how his company is working with Hollywood studios to upgrade screens are confidential, but agrees demand is high at locations converting to 3D cinema.

Beyond the Silver Screen

But movie theaters aren't the only ones looking to cash in on digital cinema. "Further downstream are non-cinema applications," says Reisteter. "Non-first-run applications are seeing the kind of success that cinema has had."

Venues such as amusement parks, planetariums, and performance halls can still benefit from digital content, even if their projectors don't meet DCI standards. Digital Projection (DP) doesn't manufacture DCI-compliant DLP 3D projectors because the majority of the company's business comes from outside the realm of cinema. "We enjoy a lot of success in the commercial market: scientific visualization markets, and increasingly, residential," says Chuck Collins, vice president of commercial AV for DP. The company also sells projectors to independent movie houses, where the movies don't come from major Hollywood studios and do not require DCI-compliance, as well as events such as the Sundance Film Festival. Other companies that have developed 3D projectors outside the constraints of DCI include Mitsubishi, Sharp, and Viewsonic.

James Cameron would be proud.


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