Studios show exhibitors the money
Anxious to see more theaters converted to digital 3-D screens before DreamWorks Animation’s “Monsters vs. Aliens” opens in March, Paramount is offering to pay print fees directly to exhibitors who have the means to finance the conversion.
The digital cinema transition has been hit hard by the economic collapse and the freezing of the credit markets, which happened just as the consortium repping the country’s three largest circuits — AMC, Cinemark and Regal — was trying to secure a multimillion-dollar line of credit.
There are a number of consortia repping different circuits, or independently owned theaters.
Studios are looking at alternative options to hurry the process along, considering that there are more than a dozen 3-D releases this year, culminating with 20th Century Fox’s “Avatar” in December.
As of now, there are roughly 1,250 digital 3-D screens out of 5,620 digital screens. DreamWorks Animation topper Jeffrey Katzenberg insists there will be north of 2,000 3-D screens ready by the time “Monsters” opens March 27.
Katzenberg said Paramount’s plan is a “huge breakthrough” for digital 3-D. He said size has become the enemy in the current economic climate, and consortia can’t get the lines of credit they need. Individual theater owners, however, may already have the means to pay for the conversion, including access to local loans.
Under its plan, Paramount will pay a specificed “virtual” print fee to a theater owner that converts at least 50% of screens to digital; the fee is higher for screens converted to 3-D.
Other studios also have cut individual deals. Many of those deals have been made in Europe.
“I am supportive of the fact that Paramount is looking for unique opportunities to move the digital cinema transition along as quickly as possible. Twentieth Century Fox also has been working directly with exhibitors, such as Odeon & UCI Cinema in the U.K.,” said Fox exec VP of digital cinema Julian Levin.
But so far, most exhibs have prefered to deal with the studios via a consortium; that way, they don’t have to carry the cost of the conversion on their books. It’s also far easier for a studio to work with a consortium, versus thousands of theater owners.
National Assn. of Theater Owners proxy John Fithian applauded Par’s move, saying that direct arrangements between distributors and theater owners won’t work for everyone, but that it could make a critical difference in certain cases.
“We urge all studios to give this creative option a fair chance,” Fithian said.