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23 Jun 07
Country: USA, UK, Germany, South Korea
Source:
Online Services/Intelligence/Cinema/Updates
Screen Digest report 'The Business Case for Digital 3D Cinema Exhibition' provides an economic analysis for the continued roll-out of 3D screens. The Hollywood studios are investing heavily in movies designed exclusively for 3D, although the number of screens will need to increase dramatically from its current low base in order to support this new wave of 3D films.
At the end of 2006 there were 258 digital 3D screens worldwide and the expansion has been rapid with each new release resulting in a mushrooming of screens. During the first six months of 2007, the number of screens worldwide has almost tripled to 750, with 85 percent of them in the US and much activity in Korea, Australia and Germany. With seven screens, the UK is second in Europe behind Germany, which boasts 22. RealD is currently the leading provider of digital 3D equipment, accounting for 94.4 per cent of all screens at first half 2007.
Our take...
The roll-out of 3D equipment is highly concentrated among the leading multiplex operators, and the top five movie theatre chains in the US now control over 80 per cent of the market by screens. Globally there are now 41 cinema chains in 21 different territories that have equipped more than one digital 3D screen. By 2009 Screen Digest forecasts that there will be over 5,000 enabled digital 3D screens worldwide, equivalent to around 5 per cent of modern cinema screens. Three quarters of these will be in the US. Analysis of box office data from the first four digital 3D releases (Chicken Little, Monster House, Nightmare before Christmas 3D and Meet the Robinsons) has shown that digital 3D screens generate on average three times more revenue, driven by a 2.4 times higher attendance ratio per screen when compared with 2D screenings for the all-important first weekend. Moreover, the introduction of flexible ticket pricing has opened up a new profit share structure in which exhibitors share the resulting 'surcharge' revenue from higher ticket prices with the Studio(or distributor), an incentive for both sides of the industry alike. Screen Digest has also produced a financial analysis which suggests that exhibitors will require a regular supply of at least three 3D movies a year in order to see a return on their investment in the equipment.
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