Digital, schmigital... Movie theatres continue to dodge web bullets


Here’s a conference call: Moviegoing ain’t going away. At least that’s how a number of panelists at last week’s Digital Hollywood New York gathering called it.

Media/entertainment trade conferences over the past several years have been trying to get their arms around the historically transformative media/entertainment/publishing/advertising/digital/technology mash-up. But feature films and exhibition have tended to be left out of this big hug.

Not so at last week’s Digital Hollywood New York gathering, subtitled “Media Disruption: TV, Film & Video, Magazines, News, Books, Games, Commerce & Advertising.” True, movie theatres, their programming and new technologies hardly dominated a conversation about e-books, tablets, apps, video streaming, smart phones, new web paywalls, social media, etc. But movies and exhibition—often wallflowers at such events—got a good share of respect and attention.

Perhaps it’s that moviegoing in this shaken entertainment and media environment continues so strong. But a number of participants on various panels at the Nov. 10-12 event at midtown’s Lighthouse Conference Center commented that people even ten years from now will be continuing to step out of their homes (however awesome the entertainment rooms) to go to theatres.

At the “Digital Media Investing” panel, Constellation Growth Capital’s Cliff H. Friedman, on the board of Digital Cinema Implementation Partners, cited alternative content in theatres—“limited for now”—as an “interesting” prospect for growth and investment opportunities. Also promising is the growth of fiber networks into theatres, in contrast to satellite delivery and the required hard-drive housing.

Going lower-tech, Friedman suggested that theatres could do a better job with display advertising in the venues by taking better advantage of the density of foot traffic and the perfectly targeted eyeballs on their real estate.

Right now, he reminded, 3D is driving the theatrical business and providing the opportunity for higher ticket prices. But some dark clouds hover, including the already in effect day-and-date release strategies of companies like Magnolia and IFC Films that may migrate to the studios and the prospect of earlier VOD windows for theatrical features, both niche and mainstream.

As for what Friedman, whose company invests in PIPES (private investment in public equities), looks for when someone comes into his office seeking backing, his first question is “What’s the secret sauce?”—in other words, what makes the business idea unique, desirable, essential, or “what makes you proprietary in relation to everything else?”

TV as an area for growth took front and center as the funding panelists, who also included Time Warner’s Andrew Cleland and Southshore Capital’s Taz Turner, wondered what those increasingly empowered TVs will look like in seven years.

Also front and center was 3D. On the panel “Beyond Avatar: Explosion of 3D Platforms for Feature Films, Television and Games,” moderator Jon Collins, whose mostly commercials-focused Framestore NY also worked on several features, including Avatar, was quick to point out that his company was not involved in the much-criticized projects involving 3D conversion from 2D origination. But he generously offered that often in such conversions—notably that of Clash of the Titans—“there was just very little time to get the [3D] work done.”

What does require close scrutiny is to what extent 3D will apply to event watching. What is known is that movies in 3D power the appeal of the videogames they generate.

Panelists, who included CTAM’s Char Beales and ESPN’s Bryan Burns, revealed that—no surprise—market research shows an “immediate affinity” for 3D on TV and for all genres (movies, sports, special events) and for gamers especially. CTAM is the cable industry’s nonprofit trade group and sports channel ESPN is an early adopter of 3D, most notably with its World Cup telecast.

Panelists noted that surveys showed that initial buyers of 3D TV will be (again, no surprise) heavy movie watchers, sports fans, gamers and “early adopters.”

The maybe-telling feedback from marketing research is that there are far more “positives” regarding the imminence of 3D than there were for HD back in the early 2000s. Yet, in spite of so much more skepticism surrounding HD, it became, as we know so well today, a resounding success. But adoption for the now pricey 3D sets may be hampered by the fact that prices for regular TVs have been declining dramatically.

Asked where 3DTV is headed, ESPN’s Burns suggested watching for the “clues,” and these—pricing aside—are positive. Just as HD became embedded in product names, 3D as added-value is happening faster. And there’s that “huge worldwide Google search” on Google’s site for ESPN 3D and the fact that there are few health issues related to 3D viewing. (Viewers readily adjust to the rare headaches associate with 3D viewing.)

Another positive for 3D TV is that market research has shown that 3D ads are more effective. But there are the higher costs for 3D production of sports events that are severe, said Burns.

And, of course, on the negative side are those glasses. 3D panelist Neal Weinstock, founder of SoliDDD, demonstrated his company’s proprietary way to get 3D to consumers without the need for special specs (digital signage or display ads are the first target, then 3D TV, then—years away—features). He brought a poster that appeared as 3D as a kind of hologram slide and required full-frontal viewing from not more than 15 feet away. But it was a 3D image with no glasses required. Weinstock, not commenting on any cinema application, predicted that TV might be just two years away.

For now, glasses for 3D TV viewing are de rigueur, a nuisance for some and an expensive one. TV manufacturers could build much of the technology into the sets themselves, but that would drive up the already elevated set prices. So it’s left to consumers to bear the burden by plunking down well over $100 for the glasses.

The panel also touched upon a little-discussed but hugely important aspect of 3D in the theatre realm. While the dimension has been added to visuals, there has been little consideration of 3D for audio, meaning sound would not just come from the front and back but from up to down, thus creating an even more realistic experience. Panelists agreed that although some exhibitors have installed seats in theatres that allow filmgoers to experience motion, they have no access to 3D audio enhancement that would also augment the immersion experience. Might some geeks over at Dolby or in other audio labs be scratching their heads over this? Compared to 3D visualizing, 3D audio replication has to be chopped liver.

Several very well-attended panels targeted aspiring or working filmmakers. A surprising, enthusiastic and fearless number were on hand at Digital Hollywood New York to learn about the new rules to follow. Moderated by IMDB’s David Straus, an energized bunny of an Elmer Gantry-like moderator, his panels attracted indie filmmakers in droves. Could it be because everyone’s making movies but no money? But both the “Digital Indie Producer” and “Self- and Creative Distribution” panels pulled ’em in like free radio promotions. Enthusiasm, if not solutions, was boundless.

Straus’ notion was to cover what’s going on today in the first panel, then what the future looks like for indie filmmakers in the second panel. But everything was about what the heck is going on today, and how do we get our films out there and seen and make some money out of it?

Those handling the product shared their strategies for survival. Oscilloscope Labs’ co-founder David Fenkel let attendees know that his company is essentially “taste-driven,” that Oscilloscope has just got to love the films they handle, and values the theatrical window above all else. Cinedigm’s Brad Carroll shared that his company thrives on themed programming for theatres, whether in the areas of sports, “kidtoons,” animé, faith-based, etc. Gary Delfiner at Screen Media Ventures conveyed that his company’s strength is in its 1,400-film library, and Slava Rubin’s IndieGoGo survives as an entity that helps filmmakers “crowd-source” to raise money for their films. And for a fee.

Rubin laid out the strategy: Filmmakers need a good pitch, then need to get proactive in raising money from people they know (e-mailing is more effective than using Facebook) and target two circles of an “engaged community”—first, a personal circle of friends and family and, next, a mainstream circle. The validation from the first group will generate money from the second.

The subsequent indie panel, whose mandate was to move into the future and guess how things will play out for independents in the next few years, remained firmly stuck in the confounding, messy, film-saturated present. There are too many portals and aggregators and platforms for films, so that both filmmakers and fans lose out.

The panel make-up, including Snagfilms’ Stephanie Sharis, whose ad-supported website provides free doc-viewing, and Impact Partners’ Dan Cogan, whose company funds socially relevant docs, was indicative of the growth of documentaries in the art-film realm. How about a GPS for navigating a film’s journey to the end viewer?

But Cogan delivered some grim news: About 600 docs were submitted to Sundance a few years ago versus today, when the festival has about 1,000 docs to sift through for under 50 slots.

Alternative content had its champion in panelist and indie distribution vet Ira Deutchman, now atop Emerging Pictures, which has found a niche as a virtual art-film circuit whose venues are often like “pop-ups” offering alternative programming.

Deutchman, alum of Fine Line Features, commented on the huge volume of indie product that each weekend vies for attention at theatres: “We used to worry about the other five films opening on Friday, but now your competition is every movie ever made.”

But theatrical is still the place to get press, he added, and it’s still “an incredible piece of the pot.” He’s “defiant” about his Emerging venues not being DCI-compliant: “It’s just too expensive.”

To get through all the clutter that everyone bemoaned, IndieGoGo’s Rubin, whose company helps filmmakers bag funding for a fee, called for a universal database that reveals where empty screens are available in theatres for booking. He also said that he dreams of some sort of algorithm that would help brands find appropriate films to support and partner with.

Digital, of course, has been the big game-changer. Notice was taken on several panels of how digitally enabled alternative programs are more and more becoming a viable choice for cinemagoers and a rare new option for an entrenched industry and investors.

Panelists spoke of new no-cost theatrical distribution strategies that can help filmmakers and theatres alike—e.g., experimenting by showing a movie one night only in thousands of theatres as a way to gain press, generate word of mouth, and launch a film into ancillaries. Also in the interest of creating word of mouth, a film might be programmed only on Tuesdays at six p.m. for a number of weeks in order to get some buzz going.

Theatres were given warning that they have to continue to improve, even on the analog front. Examples included allowing patrons to purchase alcoholic beverages and participate in Q&As with filmmakers. Q&As can even enhance that valued communal experience of cinemagoing by being pumped out to a number of theatres simultaneously. This communal appeal, we were reminded, has everything to do with people and not technology, because nothing else duplicates that collective experience.

The Digital Hollywood New York event kicked off deep in new-media territory with a keynote from Wikipedia and Wikia founder Jimmy Wales, whose comments supported the notion that moving images will be everywhere on the Web. Among many things, he promised that his hugely popular online encyclopedia will have many more video offerings embedded in its entries (in other words, don’t just read about Winston Churchill, watch the videos) and that Wiki is now encouraging such content creation.

The conference had its share of familiar mantras for filmmakers. Again, we heard that DVD submissions to distributors get lost in those tall piles, that the promo material in submission packages is very important (but don’t give too much away), and few indie films belong in theatres. But theatrical releases are critical for marketing and they create more value down the line in ancillaries (although revenues steadily decline as a film transitions from the ten-dollar theatrical ticket through VOD, cable, etc. to a final stop in a streaming worth five cents).

Another takeaway from a conference that offered plenty to take in was the advice that everything you learned about movies prior to the digital evolution should be thrown out. And filmmakers strapped for cash should think in terms of hooking up with deep-pocketed sponsors, as corporations do get on board when a film is the right fit.

Sundry panelists indicated the inevitability of studios giving certain of their bigger films a VOD shot (at maybe $30 a pop) in tandem with a theatrical release, while Cinedigm’s Brad Carroll delivered the not surprising news that exhibitors hate the fact that their window is going away. And, as IMDB’s Straus noted, is a festival screening a theatrical screening?

The blessings of digital cinema weren’t ignored: the flexibility that theatres enjoy, including the ability to manipulate schedules depending on audience interest and fill seats during non-peak periods. But exhibition wrists were slapped with one panelist’s observation that “it’s hard for exhibitors to learn something new.”

Deutchman summed up the dilemma for those on the creative side and of existential inclination: “Everyone in the world is a filmmaker. There’s no magic to this anymore.” He also called attention to the celluloid wall: “Hollywood has nothing to do with what independent filmmakers are doing.”

But there was plenty of good news. Many panelists reiterated their love of getting out and going to the movies, in spite of all the leisure-time options. After all, people in the industry are also consumers and it’s the consumer today who is in the driver’s seat, enjoying an unimaginable and ever-improving bounty of affordable media and entertainment products and services. (Even those 3D TV prices will soon fall to earth.)

But how does one make a living—even a fortune—out of this revolution? As the conference suggested, no one has yet figured that out. So maybe it’s just best to step out to a movie or kick back on the sofa with a tablet or smart phone and chill. The storm continues to rage, so let’s just enjoy it until the skies clear.