Theater chains believe there’s a way to be even more successful. They are seeking to get a head start on replacing their 35mm projectors with digital equipment.
This high-definition technology is allowing theaters in Arizona to show features that are usually only viewed live or at home.
This strategy is expensive but it could prove lucrative. Audiences seem to appreciate the difference.
People are returning to the theater and theater owners are surmising that digital is a proven moneymaker.
The biggest theater chains in Arizona committed to building only all-digital theaters earlier this year. At this time approximately 50 of the state’s nearly 900 movie screens are digital. An industry-wide conversion is expected to be complete by 2011.
TV on the Big Screen
Though customers may not be able to immediately see a difference in picture quality, they will definitely notice more variety in the programs offered…programming like sporting events, racing events, and tv shows.
This technology also makes theaters available for new uses. Showing live sporting events or live television events can be very popular…especially during typically slow movie attendance times. Even live footage of the 2007 Academy Awards and hosted red-carpet-themed parties were aired.
In August Sony Pictures released a taped performance of the show Delirium by Cirque du Soleil. It played on a limited basis on digital screens.
Delirium was marketed primarily to stay-at-home moms and retirees and had a three-day sellout and an encore viewing on Labor Day. The theater grossed about $9,000 in ticket sales for Delirium.
Risky Return
This isn’t without risk, however. Theaters don’t necessarily earn more revenue from digital ticket sales than they do from traditional movies.
The key to success is gaining new customers.
Moviegoers won’t be able to tell the differences in quality when 35mm film reels are brand new.
As far as alternative content goes…the theaters will pay higher licensing fees and are able to air the content only at selected times. They also must charge ticket prices set by the distributor and this can range from $10 to $20.
It costs about $75,000 to retrofit a standard movie screen with digital equipment. Sometimes up to 75 percent of that cost is financed because it saves money to make and ship a digital product instead of a film reel.