Digital cinema

Updated: March 3, 2008

The advent of digital cinema offers the opportunity to enhance the cinema-going experience in terms of picture quality, more diverse programming and in offering audiences the chance to experience cutting-edge digital 3D.

Digital cinema in the UK is now starting to take hold, building on the UK Film Council-funded Digital Screen Network comprising some 240 screens across the country, but more recently with the installation of a significant number of digital 3D screens at operators own expense. At the end of 2009, it was estimated that there were some 540 digital screens in the UK. of which some 420 were 3D-enabled. 

While the benefits to the cinema-goer will become increasingly apparent, it remains the case that the key financial benefits from these developments accrue to the distributor.

Distribution of films is currently via 35mm celluloid prints, which are expensive to produce and to transport. Digital technology offers the opportunity for the distributor to produce and ‘transport’ copies around the country (via the internet or satellite) at a significant cost saving.

Against that, while as systems develop these are likely the come down to a degree, the costs for many cinema exhibitors of converting their cinema will remain prohibitively expensive. The CEA therefore strongly believes that it is the studios and distributors, rather than the exhibitors, who should meet the bulk of the costs for this transition.

In the US and Europe, various third party organizations have proposed financing and installation plans to exhibitors, backed by agreements with the studios. Under these plans, the third parties raise the necessary finance to buy and install digital equipment in cinemas, with the studios over time paying "virtual print fees" (VPFs) to the third parties for the use of the equipment.

The CEA has no strong view on whether such an arrangement is viable in the UK, but is keen to ensure that as many of its members as possible are able to make the transition to digital, should they so wish, without experiencing financial hardship. Its position on who should pay for these changes is therefore clear.

The CEA has supported the establishment of the Digital Funding Partnership (UK) [DFP(UK)] a grouping of small and medium-sized operators brought together to negotiate the best possible fundng deal to support digital conversion.

You can find out more about progress of the DFP (UK) here.