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Pac Bell’s delivery system dials a ‘D’ for dubious

HOLLYWOOD — Faster than you can say “change reels,” numerous exhibition and distribution executives expressed skepticism over Pacific Bell’s announcement March 22 that it would test a system to deliver movies over high-speed phone lines at close to a dozen L.A.-based theaters this year.

While Pac Bell was quick to trumpet the system’s supposed advantages, which include lower costs and the ability to transmit different versions of one film, some execs insisted that the savings figures calculated by Pac Bellare not accurate.

For instance, while the telecommunications giant estimated that the cost of converting a theater to the new high-definition system would be roughly $ 100, 000 per screen, many executives noted that no mention was made of actual transfer costs once the systems are in place.

“They are going to have an awful job convincing exhibitors to pay $ 100,000 per screen,” said Warners distribution president Barry Reardon. “Also, how much is it going to cost to receive a print for each screen? There are still an awful lot of unanswered questions.”

“We have not heard anything about the additional costs,” said a Los Angeles-based exhibitor. “There are a lot of things that haven’t been explained. The other problem is that a lot of theaters have invested money in upgrading their equipment, and now it’s out the window.”

Pac Bell officials say it’s too early to predict actual cost savings.

“I wouldn’t hazard a guess at that right now,” said Larry Kunke, Pac Bell’s executive director/video products. “That’s tied to the technical test of what it all turns out to be. It would be too risky to guess what those numbers would be right now. That’s why it has to be tested.”

Kunke said that it is the company’s intention to test the new system extensively and then determine what the actual costs to theater owners will be. With numerous factors about the technology still unknown, what Pac Bell will charge its customers for the service is still anybody’s guess.

Another studio distribution executive figured that with roughly 25,000 U.S. screens requiring updating, the total cost for such a job would be about $ 2.5 billion, or approximately what exhibitors took in during the record-breaking, $ 5 billion-plus season of 1993.

In making the announcement, Pac Bell also said that the system would save 25% of the $ 500 million that studio and distibutors pay for making prints, warehousing film and shipping. But numerous executives said the $ 500 million estimated by Pac Bell was way too high, meaning the savings would not be as great as the company is predicting.

Kunke defended the company’s high numbers, saying that the information came from what he called “secondary sources,” although he wasn’t sure who supplied the figures.

Execs also took issue with the fact that Pac Bell seemed to overlook an important factor of a film’s release — the distribution arm of a studio that plots out the complicated strategy of a film’s unspooling across the country.

“They seem to feel that distribution doesn’t exist,” said one exhibitor. “It gives you the impression that the theaters will just dial up and get what they want. But there are many other things that come into play. For instance, two movie theaters that are across from each other can’t play the same kind of picture.”

Many also believe the quality of the films, which will be broadcast through a high-definition system, will not be as good as those projected on 35mm.

“We had seen the presentation at ShoWest; we felt that the presentation has a ways to go,” said Pacific Theatres VP Milt Moritz. “We weren’t thrilled with the clarity. It didn’t have the sharpness of film.”

Kunke defended the system. “It looked better than anything I’ve seen,” he said. “If there are critics, they are criticizing things I can’t even see. The quality test has to be met by the moviegoers, who will decide if the quality is good enough.”

In a less controversial high-tech development, Paramount Pictures and Kaleidoscope Films have linked up via Pac Bell’s fiber-optic network.

With the network in place, Kaleidoscope willbe able to produce versions of Paramount trailers and instantaneously transfer them for approval to executives at Paramount’s in-house ad agency, 5555 Communications. Changes can be made in a matter of seconds.

Once final versions of the work are approved, the work can then be sent via the fiber-optic cable to the subcontractors, who do much of the finishing work on trailers.

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