During nearly 30 years in marketing and distribution, Andrew Cripps has become a leading authority on the business models and cultural nuances unique to every international market. In his new role as president of Imax Europe, Middle East and Africa, he will apply his experience to expand the Imax footprint. Cripps discusses his approach in different areas of the EMEA region with Robert Mitchell at Imax’s London offices, and looks at the opportunities offered by new technology and local productions.
Robert Mitchell: What is your key area of focus for Imax in Europe, the Middle East and Africa?
Andrew Cripps: The primary area of focus at the moment is to expand the network across Europe. There are a lot of things you can then do: be far more flexible with programming; look at additional content, including European content. We’re making a very significant investment in Europe because we believe the growth opportunities are there. Through the second quarter, Imax EMEA box office this year was up 54% (to $58.1 million) over last year, so we’re off to a great start.
RM: What are your goals for the expansion?
AC: I’d like to see us doubling the network in the next three to five years. We’ve got 101 theaters open, 35 in backlog. A lot of growth will come from the markets that are very strong with Imax at the moment, but I think some of the growth is going to come from the big Western European countries that we’re underrepresented in.
RM: Why do you think Eastern Europe has been quicker to embrace Imax than Western Europe?
AC: One of the fundamental reasons is there’s been a lot of theater development in Eastern Europe and Russia. A lot of the older auditoriums in Western Europe don’t have the screen height to allow us to take maximum advantage of the Imax aspect ratio. But in countries where there’s still a lot of screen development and building from scratch, you can plan the Imax as you plan your multiplex opening.
RM: Many see Africa as the next major opportunity for growth. What are your strategies here?
AC: We opened a theater in Nairobi this year. We’ve got a theater open in Morocco and we’re opening our first theater in Cairo in September this year. We’ve had a number of inquiries from Africa. We’re talking to a number of players in South Africa. I see it more in the medium-to-longer-term development range.
Some of the film economies there are very small and they will grow over time, but I think Imax gives an exhibitor that opportunity to offer that premium brand that people will go to regardless of piracy and everything else that’s prevalent in the marketplace.
RM: What about the Middle East?
AC: With high disposable income levels, we’ve seen our business, certainly in places like the UAE, grow very strongly. I think there are other opportunities in countries such as Lebanon, Jordan, Egypt, and also Israel, where we opened our first commercial Imax (in July). The Middle East is reasonably small in size in terms of a region and how many Imaxes it can support, but I think within that context, there will be some pretty good growth in the short term.
RM: Is the political upheaval in the Middle East causing problems there?
AC: It doesn’t seem to be. Yes there’s political upheaval but people still have that need to be entertained. We haven’t seen filmgoing diminish significantly. People still have that need to take their families out for entertainment.
RM: Local productions are often limited to their home market. Imax has done “Houba!” in France and has “Stalingrad” in Russia next year. Is it cost-effective to develop these?
AC: It comes back to the size of the network. Where you have a substantial number of screens in a given country, then it’s worthwhile. In Russia for instance we have 24 theaters open and another 26 contracted, so by the time the release of “Stalingrad” comes next October, we’ll have well over 30 screens. As we can expand the network in (a country), we can look at (local) content programming opportunities.
RM: Are there other key markets where Imax is already strong with healthy local production that you’re already looking at?
AC: The U.K. is a good example. We’re certainly looking at opportunities here. We’re doing our first Bond film. You can call that a British film(or) a studio film, I think it straddles both. If there was a British film that appealed to our fanbase, that’s something we would look at very seriously. Typically the big local content breakout hits in the U.K. have been comedies or dramas, which don’t necessarily lend themselves to Imax.
RM: Germany and Italy seem particularly slow on the uptake for Imax.
AC: Germany has been a difficult market. Imax historically, if you go back to the documentary days, was very successful in Germany. I look at our business in Austria and see how strong that is, and it’s ironic to me that our business in Germany isn’t stronger. Imax is in 52 countries. We’re successful in those 52 countries so there’s nothing unique about Germany that says the business model won’t work there. So it’s certainly a market we’re going to focus on.
The economy has played a role in Italy. Having said that, there are five or six independent operators that we’re talking to about an Imax opportunity, and I’m pretty confident a number of those are going to come through. I think once the independent operators establish the business model, that’s when you’ll see the bigger circuits sitting up and taking notice.
RM: Imax is also developing new projection technologies, including a laser-based system. What are your plans in this area?
AC: We’re looking to have some prototypes out at the end of 2013, and our commercial rollout starting in 2014. The laser gives us the ability to illuminate much bigger screens, so we’ll be starting with the bigger screens and replacing the film-based systems that we have in the marketplace.
As home theater technology gets better and better, the cinemagoing experience has to evolve and improve, and I think laser is the next major step forward.