Digital Cinema in Russia in the First Half of 2009

According to Nevafilm Research, by July 1, 2009 there were 127 sites in 54 cities operating 162 DLP Cinema screens; a remarkable increase considering the first digital systems began opening in Russia only two years ago. Even more significant is that almost all digital screens are 3D (only two screens still without this opportunity). It is a turning point for the market of cinema equipment: the amount of new digital screens rises increasingly.

So, if the first 50 digital screens in Russia were opened during almost 2 years (21 months), the other 50 took just 8 months, and another 50 - 3 months. Along with this 3D exhibition is a main driver for national cinema operators installing digital cinema equipment. That is, according to our forecasts the market growth rate will slow down by autumn.

1/4 of all Russian digital screens are located in Moscow - 42 screens in 26 sites. Moscow is followed by Saint-Petersburg - 13 screens in 10 sites. 7 digital screens are in Ufa. Krasnodar, Krasnoyarsk and Novosibirsk have 5 digital screens in each. Tyumen, Vladivostok and have 4 screens in each.

Today digital cinema equipment is installed in every tenth movie theatre in Russia.

Cinema Park network holds the position of leader in Russian digital cinema exhibition market - 29 screens of its chain are digitally equipped. Rising Star Media is on the second place with 12 digital screens. It is followed by Luxor and Karo Film cinema operators - each has 8 digital screens. Kinomax and Formula Kino have 6 screens each, Illuzion operates 5 screens. 42 digital screens belong to independent cinemas.

As for companies that provide digital cinema equipment installation and integration services, in the middle of 2009 the leaders are Nevafilm - 33% of all digitally equipped cinemas, Kinoproject and Cinemeccanica - 18% each, and ASK - 11%.

Most popular digital projector brand in Russia is still Christie. It dominates with 55% share of the market (though within 3 months it has drop by 3%). Cinemeccanica holds 21% (also drop by 5%), NEC - 12% (+2%), Barco - 10% (+4%), and newcomer Kinoton - 2%.

Dolby has a priority in Russian market as digital cinema server and 3D system provider with 65% and 64% shares respectively. The market of digital cinema servers is also presented by Doremi Cinema, which has 33% market share (-3% within 3 months). There are also Kodak and Qube - 1% each.

As for Digital 3D systems, the market leader Dolby, which share has increased by 2% since April, is followed by Xpand that occupies 26% (-5% within 3 month) of the market. RealD has entered Russian digital cinema market and since April its share increased by 4% to 7%. There are also few digital 3D systems from MasterImage, Dual Projection and IMAX. And just two screens are still without 3D technology (one in Moscow and one in Magadan).

The number of digital releases in Russia is growing. In the first half of 2009 52 movies have been released digitally in Russian cinemas, including Ice Age: Dawn of the Dinosaurs 3D, released in Russia on July 1, 2009 (vs 63 in a whole Y2008). Among them are 7 movies of local production. 7 movies were screened in Digital 3D.

The slate of digital 3D movies for the rest of the year includes Sea Monsters: a Prehistoric Adventure, Oceans 3D: Into the Deep, Little Hercules in 3D, G-Force 3D, Final Destination: Death Trip 3D, Rolly and Elf: Unbelievable Adventures 3D, Toy Story 3D, Cloudy with a Chance of Meatballs 3D, A Christmas Carol 3D, The Descent: Part 2 3D, Avatar.

It is necessary to note that Digital 3D is the main driver of digital cinema opening in Russia.

In the first half of 2009 the first practices of alternative content distribution and presentation in digital cinemas took place. Nevafilm Company has launched Nevafilm Emotion, a new department specializing in theatrical distribution of alternative content, special events and live broadcasts in cinemas - the first of its kind in the country.

It has successfully organized the first alter-event for digital cinemas in Russia - Iron Maiden Day on April 21st with the screening of Iron Maiden: Flight 666 (42 digital screens in 35 cities) and on May 26 - Tribute to Pavarotti: One Amazing Weekend in Petra (30 screens/23 cities) in cooperation with More2Screen.

The nearest project will start in August 15, 2009 - special screenings in digital of Last Hero. 20 Years Later documentary dedicated to cult Russian rock musician Victor Tsoi. Opera and ballet programs will be presented in digital cinemas of the country. 2009/2010 season will feature series of performances prerecorded in High Definition in Mariinskiy Theatre in Saint-Petersburg and 8 operas from LaScala.

Svetlana Mudrova, Nevafilm