Paramount, Kodak Reach Digital Cinema Deal

Viacom Inc's Paramount Pictures said on Wednesday it reached a deal with Eastman Kodak Co to finance the deployment of cinema technology in movie theaters.

The Kodak deal, which will be applicable to the deployment of digital motion picture projectors to U.S. exhibitors, will provide for the payment of Virtual Print Fees (VPF) to help promote the installation of digital projection systems. Exhibitors who install the Kodak system, which also supports 3D technology, will convert to a DLP-based 2K projector, along with Kodak content players and the Kodak Theatre Management System. The deal covers as many as 8,000 U.S. screens.

Earlier, Paramount and four other big studios reached a deal with the Digital Cinema Implementation Partners (DCIP), comprised of Regal Entertainment Group, Cinemark Holdings Inc and AMC Entertainment Inc, to upgrade 20,000 U.S. and Canadian cinema screens.

Paramount's Kodak agreement provides digital upgrades to theaters not covered under the DCIP. Under this deal, Paramount will pay a virtual print fee, estimated at about $1,000 per movie, every time one of its films plays on Kodak systems.

Paramount said it was the first studio to sign with Kodak.

With today's agreements, Paramount has signed a total of seven digital cinema integration deals, more than any other major studio. The others include two domestic agreements with Access IT (Phase 1 and Phase 2) and three deals with European integrators XDC, Arts Alliance Media and Ymagis. So far, more than 3,500 screens have been converted to digital under Access IT's Phase 1 plan.

By Sue Zeidler, Reuters