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Industryites head for Sin City to size up state of pic biz

ShoWest 2005 will be a mix of the familiar and the new, and chief among the latter will be Motion Picture Assn. topper Dan Glickman’s first state of the industry address.

After 30 years of Jack Valenti offering his annual assessment of the movie biz for exhibitors and studio suits at the confab, many wonder how Glickman’s approach will compare with his predecessor’s florid oratory.

“Jack told me the best way to succeed is to be true to myself, so I’m not going to follow his speaking style,” says Glickman, a former Dept. of Agriculture secretary and longtime congressman from Kansas. “But I do intend to emulate Jack’s leadership on the issues.”

Several movie screenings will number among the show’s other stock ingredients, along with another de rigueur session on film piracy. But some contentious issues also are likely to figure in show buzz around the Paris and Bally Hotels through Thursday:

  • Digital cinema — Warner Bros., Sony and Disney are in advanced talks over a business plan to roll out 1,500 digital installations in movie theaters nationwide. Details of the discussions may circulate, with other studios also engaged on the periphery of those talks.

Sony is expected to demo its so-called 4K projector for d-cinema. The technology offers twice the resolution of current digital projectors but at higher cost. Studios lining up to fund a rollout of equipment must decide whether to buy 2K or 4K projectors, or a combination of both.

At least some studio-funded projectors likely will be bought and installed by the end of this year, but for now there are fewer than 250 digital systems worldwide considered useable for major commercial releases. And only about 90 of those are in the U.S. and Canada.

  • On-screen advertising — Regal, AMC and Loews Cineplex love the ancillary revenue from running product commercials before trailers. But some exhibs fear moviegoer backlash over the trend. Watch for talk to turn electric when execs debate the subject.

John Fithian, topper at the National Assn. of Theater Owners (NATO), says: “NATO-California did a survey not too long ago … showing there isn’t much of an impact, but we might take another look (once the cinema advertising market) matures a little more.”

By sharp contrast, Century topper Ray Syufy is a vocal skeptic on the subject. His San Rafael-based circuit doesn’t accept cinema advertising other than simple slide-show ads. “We don’t know if cinema advertising is a good thing or not,” he says. “We so far have found nothing to indicate that advertising is being accepted by the public.”

  • DVD windows — Studios are releasing pics into homevid ever more quickly, and exhib complaints about the practice are growing louder. But most of the grousing will go on informally in the lounges and on the links around Vegas, as exhibs feel it would be imprudent to confront Hollywood execs publicly on the subject here, where the tenor of official sessions stresses cooperation among distribs and theater owners.

Theater owners seem more upbeat on the subject, noting that studios have been displaying more flexibility in film rental negotiations to balance the shorter theater runs.

“There have been some adjustments,” says Mike Campbell, co-CEO at No. 1 U.S. exhib Regal, but he adds that the skedding of DVD releases ever closer to theatrical bows continues to be a sore subject. “Video windows are creeping up, and I think it’s something the entire industry needs to monitor. Exhibitors realize that DVD is an important revenue source for studios, but the (theatrical) business has got to stay healthy as well.”

State of the biz

In his keynote remarks this week, Glickman is expected to strike an upbeat assessment of the state of the movie biz in general.

Box office was up last year, admissions down only slightly and industry grosses are outpacing the same period of 2004 so far this year. Exhibs expect a strong summer, with May offering a new “Star Wars” episode and subsequent months dishing up seemingly surefire fare such as Steven Spielberg’s “War of the Worlds” and comic-based actioner “Fantastic Four.”

But all is not completely rosy, as a recent uptick in the U.S. movie screen count is an area of concern, warns NATO’s Fithian, a co-keynoter whose father Floyd served in Congress with Glickman. He points to U.S. screen growth of 1,000, to about 36,600, compared to a year ago.

In contrast, growth at Sho-West is relatively flat. While exhibit-floor space should outpace last year’s 490,000 square feet by about 5%, organizers predict that they’ll match 2004’s attendance with a projected 2,750 fully paid registrants.

“There are still some lingering effects of industry consolidation,” explains Mitch Neuhauser, co-managing director of ShoWest.

Despite the moderate attendance compared to peak years, organizers were hit with a shortage of hotel rooms due to a big construction industry convention in Las Vegas this week. Hundreds of ShoWesters have been lodged at the Aladdin and other nearby hotels rather than the host Paris or Bally’s.

Timing and format of the Vegas convention make it unlikely that ShoWest ever will screen major summer tentpolers the way October’s ShowEast showcases holiday titles. Studios tend to confine their summer tub-thumping to lavish show reels. But with many pics still in production, even show-reel costs run upward of $1 million per studio.

On the other hand, studios have reduced their share of costs associated with ShoWest banquets by taking on technology sponsors to fund those events. Studios still pay to fly in talent for the bashes, and hiring private jets can cost well into six figures.

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