D-Cinema Drive-In and Roll-Out

Could There Be A Revival of Drive-Ins? Are the Financials of D-Cinema Rollout Finally Solved?

It’s hard to find anyone, at least over the age of 30, that doesn’t hold some fond recollection of going to a drive-in theater and thus laments the steady closure of these sites across the country.

Although it seemed drive-ins were headed the way of the dinosaur after declining in the number of sites and screens every year since their peak in the 1970s when there were over 4,000 sites nationwide, the last few years saw this trend not only stop but the number of sites and screens actually increase, according to the United Drive-In Theatre Owners Association (UDITOA).

The reason is essentially nostalgia. People like the privacy and freedom of watching a movie on a big screen from the comfort of their cars, even if the picture quality isn’t as good as an indoor theater. But soon, drive-in theater aficionados may not have to be resigned to this sub-par image quality much longer as many drive-in theater owners are looking at making the switch to d-cinema.

Last month, the Transit Drive-In located in Rockport, NY, hosted an exhibition for UDITOA members to showcase the power of d-cinema. This exhibition was borne partly from conversations started at the UDITOA convention in February involving NEC, manufacturer of d-cinema projectors and storage systems.

“We thought we were going do to this convention just to let them know that d-cinema was something they were going to have to look at down the road," explains Kurt Schwenk, director of Media Solutions for NEC Solutions America. “But their response was, ‘No, we need to do this now, how can we do it?’ After trying for so many years to push d-cinema forward and meeting a lot of resistance, this was quite refreshing.”

So together they organized this exhibition, which was powered by NEC’s STARUS NC2500S Digital Cinema Projector and the JPEG-2000 enabled QuVIS Cinema Player.

“The point was just to experiment and show how well it could work,” explains Schwenk. “Traditionally, drive in theaters do not come anywhere near the specifications of indoor theaters and they are used to seeing dimmer pictures. When I started my career at Warner Bros. We would still make 6-point lighter prints for drive –ins bto compensate for the longer throw distance. We tested it on an 70- 80- and 100-foot wide screen and all of the measurements showed that the d-cinema projection had nearly twice the brightness of the film projection. So the better image quality is really the incentive for these owners, plus it allows them to get into digital advertising and alternative content events the same way it does for indoor theater owners. ”

D-Cinema ‘Virtual’ Business Plan

The conundrum for outdoor and indoor theater owners wanting to switch to d-cinema are essentially the same: are they going to have to absorb the entire $80,000 cost per screen to switch to digital with no way to recoup that cost. And if the owners weren’t going to pay it, who would?

For years this has essentially left d-cinema at a standstill. But a viable business model seems to have finally been reached in the form of virtual print fees. Presently, both Technicolor and Christie AIX are both rolling out their own d-cinema initiatives with similar business plans brokered between them, the studios and theater owners, says Schwenk. (NEC is part of Technicolor’s current beta test program that is looking at a variety of systems and configurations to determine which one will be its standard for a wider rollout).

“Both these plans work off of virtual print fees,” notes Schwenk. “In effect what the studios are doing is to help subsidize the transition to digital. By the time you make a print, distribute it and bring it back in and destroy it, you’ve spent about $1,300. The virtual print fees are settling at around $900. So studios are saving $400 for every unit that goes out and are willing to pay some of the differnce to help pay the cost of the hardware installation. If a theater signs up with Technicolor for an installation, Technicolor pays for the installation though there is some financial commitment from the exhibitors, which I have heard is in the $5,000 to $10,000 range, just as a little insurance that they will take care of the equipment.”

Along with the current rollout by Christie AIX and Technicolor, Kodak and Dolby also have planned rollouts. The biggest player in this is Natinal Cinemedia, which was originally set up as the advertising branches of Regal and AMC to handle pre-show advertising, is still weighing its options. Recently CineMark also was added under the National Cinemedia group.

“They are the wildcard and represent about 13,000 screens,” says Schwenk. “So everyone is waiting to see what they do. Currently they are testing out all the systems.”