Changes & Challenges: Cinemas embrace innovation, but some dangers lurk
Technical innovation in cinemas is not a new phenomenon, but in the same way that digital has sped up the pace of technological change in the wider world, so it is in the film and cinema sectors.
Technology is one of the core topics driving cinema in the present day. Issues such as HDR (High Dynamic Range), immersive sound and laser illumination are at the heart of the consumer experience, and it is by this measure that the future of these technologies will be judged. In recent times, it began with digital 3D, which remains the dominant format in cinema screens (56% of cinema standard digital screens are equipped with 3D), even if box office does not match that. While Xenon lights the vast majority of screens in the world, newer technologies such as laser and mercury bulbs are on the up. RGB laser is growing and the number installed now exceeds 375 around the world (Barco, Christie, Dolby and IMAX are driving this trend), whereas laser phosphor is being pitched as the workhorse of the sector with over 5,000 machines installed globally (NEC is behind many of these). Beginning with smaller auditoriums, these machines can now work on screens up to 17 meters wide.
Screens with immersive sound systems have now reached around 3,300 globally, just over two percent of the world’s screens but more important economically than that figure, due to the nature of these screens (typically PLF and high-earning). HDR, for its part, is just setting out and probably needs to be better defined and understood by audiences, but outside of Dolby Cinema (70 screens), projector manufacturers have also launched machines with higher contrast ratios to enable it. There is also a more affordable software-based system in the market, named Eclair Color, which is now in 18 screens in France and Germany. High Frame Rates (HFR) are still being experimented with and while it could be argued that we have not found the best way to proceed with HFR, it does add another layer to the creative process.
Multi-screen formats are not taking root as quickly as the manufacturers would like. The issue with such technologies is often finding a sufficient supply of content that will drive customers to watch their proposition, and to prove that the concept works. However, the two main companies (Barco Escape and ScreenX) have around 140 screens between them trying this technology out.
4D is making inroads into cinemas, with 437 screens in place at the end of 2016. The major player is Korea’s CJ 4DPLEX, with more than 43,000 seats in 370 screens in 47 countries around the world at the end of 2016. Rival U.S.-based company MediaMation offers MX4D, with 84 screens as of end of 2016. Immersive motion seating (IMS) is more subtle than 4D, just offering the motion seats and not the environmental effects. The main player in the IMS space is Canadian company D-Box. Its technology is present on 615 screens (installed or in backlog) as of end 2016.
Virtual reality is also making its presence felt in the cinema space, with IMAX taking a lead. VR in cinemas takes immersivity in a different direction to that being targeted by immersive technology in the auditorium (sound, image, seats, etc). So far, VR in cinema is looking to complement the film experience, not replace it.
Of course, technology is not the only area where innovation is possible, and indeed desirable. The digitization of projection has allowed for more innovative programing and scheduling, including new content forms such as event cinema and eSports. The cinema venue can be taken in new directions, and the design of the film-viewing venue can make use of innovation, such as the Magi Pod.
Social media is also allowing an innovative approach to communicating with and increasing engagement with existing and potential customers, starting a conversation with the guest weeks before an actual visit and continuing it after the screening itself. Analytics is also driving more effective marketing, pricing and scheduling within the cinema. In the cinema itself, the approach to service is learning from other experience-led sectors to heighten the customer experience.
However, there are one or two dissonant areas emerging, being heightened by the growth of technology. The sector may need to revisit the DCI specification, as many of the recent innovations were not foreseen in this document, and in a market the size of cinema (relatively small by industrial standards), unchecked growth is not an effective option. There is an argument for a review of the standards and industry practices in place if all parties are to be working on the same lines. Secondly, there is the danger of a disconnect between the creative process and the projection of films in cinemas. Whereas Avatar drove exhibitors into digitizing around 10,000 screens (and equipping with 3D) in the anticipation of extra revenues, the next technological step (The Hobbit in 48fps) wasn’t as successful and by the time we reached Billy Lynn’s Long Halftime Walk the number of cinemas upgrading technology to show it in its full technological glory was zero, despite the combination of film and technology offering something quite extraordinary. The projection end of the business needs to know what is being done at the creation end early on in the process so that it can come onboard (or not).
Innovation is driving a new energy in the business. While the industry needs to keep an eye on technology proliferation in order to maximize every investment dollar spent in what is a relatively small industry, especially with the challenge of projector replacement to come, technology and innovation have radically altered the business of cinema, which is feeding through into the consumer perception, and the sector is a vibrant and positive one. That is not something we would have been confident of a decade ago.
David Hancock is research director, film and cinema, at IHS Markit and the president of European Digital Cinema Forum. For further thoughts on this topic, please see UNIC’s recent report, “Innovation and the Big Screen.” Mr. Hancock will discuss cinema innovation during CinemaCon’s international seminar sessions on Monday, March 27.