The National Assn. of Theater Owners adopted a resolution Friday spelling out exhibitors’ position on how the conversion of theaters to digital projection systems should proceed.
“There’s both a symbolic and substantive importance of the resolution,” NATO prexy John Fithian said. Symbolically, he said, “It’s the first time exhibition has been united on digital cinema.”
NATO chair Steve Marcus, of Marcus Theaters, said in a statement accompanying the resolution, “Industry planning for digital cinema stands at a critical juncture. Our members believe it is the right time to describe our needs publicly.”
Much of the resolution covers old ground, such as exhibs’ belief that new digital systems should deliver to moviegoers an experience superior to both existing film systems and home entertainment systems.
Splitting the costs
But the resolution also covers the most tricky elements of converting the industry to digital cinema, such as how to split the price of purchasing new equipment between studios (which stand to save the most in lowered distribution costs) and theaters.
In the doc, exhibs said any financing plan under which studios would assist exhibs in the upgrades must be an industrywide one, “supported by all major motion picture studios through one financial entity or a consortium of financial entities, and that all other motion picture studios willing to participate in the plan must be given the opportunity to do so.”
Fithian said exhibs don’t want to be in a situation where their digital projectors show only films from certain studios. “How do you implement equipment that you don’t know will work with product from all studios? You don’t. It’s a nightmare.”
Security still a concern
Resolution also covers more prosaic matters, such as how security systems would work.
Films that exhibs would download over satellite, or other data servers, would arrive encrypted.
In order to prevent piracy, studios would provide decryption “keys” that would allow the film to be decoded only by the projection system in a specific auditorium.
Exhibs, fearful that this would limit their ability to move films into different auditoriums, say in the resolution that they want the auditorium keys to be provided for all screens in a complex, so the exhibs maintain “full discretion over the selection of auditorium, schedules and presentation of advertisements, trailers, features and other content.”