The CEA today launched an exercise to explore interest amongst UK cinema operators in some form of collective negotiation for the funding for digital cinema.

For a significant number of operators, the costs of purchase and installation of such equipment are likely to remain prohibitively high. The CEA therefore want to look at whether a grouping of companies could drive a better deal, with this initial exercise intended to give a better idea of the potential size and nature of those who might be interested.

Announcing the launch of the initiative, which seeks provisional ‘expressions of interest’ from UK cinema operators, CEA Chief Executive Phil Clapp said:

“In recent months, the economic downturn has made immediate progress on digital cinema roll-out much less likely. But as the wider economic situation improves, so an increasing number of deals will be concluded and the momentum of change will again increase.

When that time comes, many cinemas, not least smaller independent operators, are unlikely to be able to negotiate favourable financing deals on an individual basis given their limited market power. It therefore seems sensible to explore whether some form of mutually beneficial negotiation might be feasible.”

Looking ahead, he added:

“Once we have a clearer idea of those with an in principle interest in taking part, we will be better-placed to decide on next steps. It might be that the CEA leads on this going forward, or it might be for example that some other exhibitor or grouping of exhibitors takes the lead. The important thing is that we begin a structured dialogue on how we might find a sustainable and market-driven solution which allows as many as possible of those who wish to, to convert.”

“Inevitably it might not be possible for all of those interested to participate in any final arrangement, but at this initial stage we wish to hear from all cinema operators who are potentially interested in being involved.”

The closing date for responses is 1 July 2009.

Download further information on this exercise, and details of how to register interest.