Digital Cinema in China

Going to the movies costs a lot in China because there are so few screens - just around 4,000. But expanding cheap digital cinema will bring down prices. Over the past four years, the sale of half-price tickets on Tuesdays by all city cinemas has delighted moviegoers.

Tuesday screenings, of course, are packed for blockbusters like Transformers 2: Revenge of the Fallen and Harry Potter and the Half-Blood Prince. Last Tuesday when Kevin Yang, an IT supervisor, and his girlfriend rushed to a downtown cinema at 6pm to see Transformers 2, they were out of luck. The next available screening was after 10pm. They gave it a pass since they needed to get up early for work the next morning.

"We postponed it until an early weekend morning when tickets are half price," he says. Before noon many cinemas also sell reduced-price tickets.

Tickets for big films costs 100 yuan (US$14.7) at most cinemas, a lot for many moderate-income people like Yang. That means the cost of a date is more than 300 yuan, including eating out and transport. In the United States last year, the average movie ticket cost US$7.18. A recent survey by the Chinese film industry shows that spending on movies represents 5 percent of a person's monthly salary. That's higher than in the US and South Korea.

The high cost of tickets in China is determined by the market, says Emi Lin, general manager of Dadi Digital Cinemas. Compared with the 40,000 or so screens in the States, China has only about 4,000, according to Lin.

"The small number of screens can't satisfy the demands of a large population," he says. Just as cell phone and computer prices fell when output increased, ticket prices will fall when there are more theaters and economies of scale, he observers.

Even for Transformers 2 and Harry Potter, Dadi Digital Cinemas only charges 10-30 yuan per screening at its four new theaters in the suburbs. The price is lower both because the theater is more distant and the digital technology is cheaper.

Though many Chinese moviegoers have little idea about digital cinema and can hardly tell it from standard one, developing digital cinema is a big trend worldwide. In 2008 there were 8,614 digital screens worldwide, 33 percent more than in 2007, according to entgroup.cn.

China has around 800 digital cinemas, ranking second after the US that has 5,474. The Chinese government is encouraging domestic cinema chains to adopt digital cinema. The National Film Supervisory Bureau under the State Administration of Radio, Film and Television (SARFT) gives financial support to new digital cinemas. The plan is to expand it to small and medium-sized cities as well as major urban centers.

"The rate of development in digital cinemas is close to that of America," Lin adds. By the end of this year, the number of digital screens in China is expected to reach 2,000.

The state-owned Shanghai United Cinema Lines, the city's largest chain, is rapidly developing digital capacity. By the end of this year it plans to have 160-190 screens.

"It is an inevitable trend," says Bao Yifan, an official from the cinema chain. "Digital cameras will finally replace traditional film cameras among common households. So will digital cinema."

The advantages include high quality, low screening cost and anti-piracy technology.

Instead of using film, digital movies are all computerized, which means digital screenings don't have the scratches, flickering images and other problems of film. A digital movie screened hundreds of times is still sharp, with bright color resolution.

A digital cinema only needs a single digital cinema projector compared with standard film cinema which requires two projectors. A digital movie hard disk only costs around 1,000 yuan and can serve as the "mother disk" for a whole city, which dramatically brings down the cost of movie projection.

It can thwart piracy because each screening of the digitally projected movie can have its unique code buried in the pixels, invisible to the audience but copied into pirated DVDs. It can be used to track a movie right down to the theater and the time it was shown.

Digital cinemas are also good news for young film makers. Lin, from Dadi Digital Cinemas, says that distributors for low-budget films usually can't afford to develop several hundred traditional Data-Transmission System (DTS) film copies around the country.

"But with the increasing number of digital screens, their dream to promote films at major theaters will come true," he says. "Going digital can also drive diversity in Chinese cinemas."

According to film professor Gu Xiaoming from Fudan University, the rapid development of digital cinemas will give movie theaters new functions.

"Besides movie screenings, cinemas can also provide digital projection of a live broadcast of a performance, a game or other events," Professor Gu says. "Many Western theaters can also reap big profits from acting as a meeting room or a 3G product demonstration center."

Experts suggest that theaters offer lower ticket prices for second runs of popular films and for less-desirable seats closer to the screen.

By Xu Wei, ShanghaiDaily