Driving Digital

With the worldwide economy in an apparent tailspin and the mainstream U.S. digital deployment stalled due to lack of capital, digital cinema in the Asia-Pacific region continues to slowly grow country by country, with now over 1,000 systems spread across the region. At the close of 2008, the driving factors in the Asian rollout are the exhibitors themselves who want to take advantage of the uniqueness of the relatively few 3D titles. The installations are being financed by cinema owners who are installing a few carefully selected screens with state-of-the-art, DCI-specified 3D equipment.

Similar to the U.S., Latin American and European markets, growth in Asia for the past year has been on a per-screen basis and usually only where justified by the expectations of short-term box-office returns that the popular 3D titles typically produce. With the possible exceptions of China and India, most Asian countries are still missing strong third-party digital providers, who might speed deployment by providing exhibitors with financing packages that offset costs with studio-supported conversion incentives.

China is a notable exception to the 3D-only trend, where government-supported initiatives along with several private exhibitor consortiums are moving forward with new cinema builds and selected retrofits using digital projectors.

The largest Chinese deployment is being managed by the China Film Group Corporation (CFGC), the Beijing-based organization leading their film industry. In 2007, CFGC commitment to install 700 screens with a state-of-the-art combo system from Singapore-based server manufacturer GDC Technology. The GDC DCI-2100 integrates a Barco DP-2000 2K projector with the GDC DSR SA-2100 server into an easily deployable package. GDC, working with Shenzhen-based Institute of Digital Media Technology (Shenzhen IDMT), ultimately plans to increase their Chinese installations to over 2,000 systems. As of November 2008, over 500 of CFG’s GDC digital systems have been installed.

GDC has also installed its SDM-4000 Display Maestro lobby and preshow system in various Chinese cinemas such as Hong Kong’s MCL Telford Cinema. This package integrates equipment for d-cinema payout, on-screen advertising and in-lobby advertising, and provides a central management system for full system control.

GDC has also been working to insure a continuous flow of digital titles from Chinese production facilities by equipping many with its new EN-2000 JPEG 2000 encoder and mastering system. “The addition of the EN-2000 will allow us to offer the latest in postproduction technology to better serve our customers. The reliability and versatility of the EN-1000 have been legendary; we believe the EN-2000 will be equally impressive,” says Wang Jian Xiong, technical director of Hualong Digital in Beijing.

Parallel to the Beijing-based CFGC installation, the Shanghai Film Group (SFG) jumped in with plans to deploy 100 systems in its own United Circuit using Christie projectors and Dolby servers — many will also use Dolby’s 3D system. “SFG holds an important place in the China cinema market. It will benefit greatly from this digital rollout and play a part in developing the enormous potential of cinema in China,” comments Lin Yu, VP of sales, Christie Asia-Pacific. Mahesh Sundaram, VP, Asia-Pacific, at Dolby Laboratories, adds, “Cinema entertainment is evolving quickly in China. Dolby’s involvement in the 3D movie premiere of Journey 3D in collaboration with Shanghai United Circuit and Shanghai Film Group has opened the door to commence the rollout and deployment of Dolby 3D, bringing a new and inspiring cinema viewing experience to consumers in China.”

In addition to the ongoing China Film Group and Shanghai Film Group deployments, there are private deployments of several hundred systems underway from independent exhibitors Shanghai Paradise, Dadi Cinema Circuit and New Alliance Cinema Circuit, bringing the total installed as of November 2008 to over 620 screens. Of these, more than 80 are equipped with 3D using equipment from RealD, Dolby, XpanD, and MasterImage.

India is moving away from just being an e-cinema market, with many of the previously installed MPEG-2 and MPEG-4 based systems around the country being upgraded to DCI-specified JPEG-2000 2K systems.

In the spring of 2008, Scrabble Entertainment —India’s leading d-cinema provider— announced its plans to begin deployment of 350 DCI-grade systems using Christie projectors and Qube servers scheduled for near-term installations, with future plans for up to 1,750 systems over the next five years. As of November 2008, their first exhibitor partner, PVR Cinemas, had installed seven systems at its Amby Valley Multiplex near New Delhi.

Adlabs Films Limited, part of the huge Reliance Group, has installed over 20 systems in its sites around Mumbai and has plans to increase their installed base dramatically in the coming year. Adlabs has also begun to distribute the digital files to their cinemas using their sister company Reliance Communications’ extensive network of fiber-optic links that span India. Another large exhibitor network, UFO Moviez, with an existing network of over 500 e-cinema systems, has also committed to begin deploying DCI-grade equipment using Dolby servers to build a base for Hollywood content.

Chennai-based server manufacturer Qube System, which in September received a sizeable investment from Intel, has also been providing equipment and services for many exhibition networks including Pyramid Group, Cinemeta and others. Although starting with e-cinema, Qube is upgrading many of their customer’s earlier installations to fully compliant DCI systems to play Hollywood content.

Taiwan is slowly moving ahead with approximately 20 digital screens in operation, doubling the total from this time last year. As with many other markets, recent installations are being driven by individual 3D titles. There are currently six 3D screens using equipment from Dolby, RealD and MasterImage installed in Taipei and Kaohsiung. As the global economic crisis continues, Taiwanese exhibitors are slowing their digital investment while hoping for some signs of a studio-supported financing plan.

Thailand currently has 16 digital screens in operation and more are being added when needed to play specific 3D titles. Thailand’s leading integrator, Goldenduck Group, has been responsible for overseeing the recent installations at SF Cinemas and Major Cineplex.

Indonesian exhibitor 21Cineplex has installed five digital systems and this year the Philippines got their first digital installations with two 3D systems being installed at the Araneta Gateway Cineplex 10 and one at the SM Mall of Asia. Similarly, Malaysia has gone 3D with a single screen being added at Golden Screen Cinemas Mid Valley in Kuala Lumpur.

Tokyo’s T-Joy Entertainment continues to lead the Japanese conversion with approximately 40 screens equipped from Japan’s total of around 100 digital screens. Dolby has been particularly active in the Japanese market with the installation of 38 of its servers and 13 Dolby 3D Digital Cinema systems in multiplexes across Japan. “T-Joy is an innovation leader of digital-cinema technology, opening Japan’s first 3D theatre in November 2007 featuring Dolby 3D Digital Cinema,” says Naoshi Yoda, T-Joy’s executive director. “The Dolby 3D system’s high-quality image has us very excited for upcoming 3D movies. Our customers are just as impressed with the Dolby 3D presentation as we were when choosing the system for our theatre chain.”

In Australia, there are currently 32 digital screens and all are 3D-enabled, most equipped with Barco projectors and Kodak servers, and using RealD’s 3D system. Kodak Australia is RealD’s exclusive agent for the Pacific region and has been responsible for the large majority of 3D installations in the area. As with other Asian and Pacific markets, digital conversions Down Under have been driven by specific 3D titles. The independent Australian exhibitors feel threatened by the coming digital age, but also see an opportunity to take advantage of the coming 3D content, although the financial commitment is a large burden.

New Zealand also has installed five systems in cinemas located in the major areas around Auckland and Wellington, operated by Hoyts, Reading and leading independent Skycity Cinemas.

In 2008, both China and India made progress with the conversion of their industries to digital. In China, growth can be attributed to strong governmental support for programs to modernize their cinema industry. In India, the progress was seen in the upgrading from previous e-cinema to full DCI-capable systems.

It is expected that the rate of installations will speed up somewhat in 2009 as the economic situation is resolved and considering the large slate of upcoming blockbuster 3D titles. In the smaller markets and with the independent exhibitors, the economics of the 2D digital deployments remain a problem. With few if any regional deployment initiatives providing studio incentives, installations are on a screen-by-screen basis and being driven primarily by a few 3D titles. While 3D is on a roll in Asia, the 2D rollout will have to wait until the global economy recovers and hopefully some studio conversion incentives become available.

Digital Screens in Asia
China: 620
Korea: 180
Japan: 100
India: 34
Australia: 32
Singapore: 28
Taiwan: 17
Thailand: 16
Indonesia: 5
New: Zealand 5
Philippines: 3
Malaysia: 1
Total: 1,041

By Bill Mead, Film Journal International