3D Projection - Feature Film Exhibitors Silver Bullet?

Implications: 1. Exhibitors Need to Find New Ways to Differentiate in the Marketplace 2. The Movie Going Publics expectations of exhibitors is increasing 3. CGI and Live Action content is enhanced by 3D Projection Technology

Analysis: As HD TVs become larger and HD DVD becomes less expensive and more readily accessible to the mass market, consumers see less and less of a differentiation between the 21st century home theatre systems and the local multiplex. With Comcast announcing at the recent Cable Industry trade show in Las Vegas that they plan to participate in the broadcast of first run feature films in the near future, the exclusivity of content that film exhibition companies have had for over 100 year is in jeopardy. With an ever increasing number of media outlets competing for consumers attention (and dollars), film exhibitors are in desperate need of ways to differentiate their product in the marketplace.

Enter 3D Digital Projection. With the advent of new technology, digital projectors are now available that can produce up to 8.8 billion pixels of resolution, which is more than 4 times what traditional 35mm film prints provide, so without even bringing up any of the back side economic drivers (and there are many) to the consumer it is  simple, digital projection looks better. It looks better than anything they can purchase for their homes currently (short of purchasing the same digital projectors, which can run six figures) which is a large part of why they are being drawn to to digital screens in larger numbers.

While all content benefits from higher resolution projection, digital generated content (such as CGI animation and live action with a large amount of special effects shots) are the most significant beneficiaries.

Given that the cost of the box office is typically less than $5 more to attend a digital projection of a feature film, it is usually on a larger higher quality screen, and the image quality is noticeably better, it is no wonder that more consumers are voting with their wallets for this option.

There are economic concerns to take into consideration when deploying digital projection in theatres, but the long term financial benefits are obvious and exhibitors who do not make transition will eventually go the way of the drive-in, a nostalgic memory of the a bygone era.