by Michael Fleck, Columnist

With an estimated 30,000 cinema screens, the Asia Pacific region is the largest untapped market in the world for this new wave of theatrical content. Across the region, there is a rapid conversion from the old optical projection to high definition digital projection. The systems range from US$50,000 to US$200,000 per screen and are being funded by governments, private investors, and cinema owners. Once installed, they allow the cinemas to eliminate celluloid, and projector movies from digital drives or ‘trickle’ downloads across the Internet. For US$5,000 per cinema (not per screen), these cinemas can be enabled to receive live content from anyplace in the world, giving them an impressive new revenue source.

The market in Asia is substantially different from the more established regions of North America and Europe. In North America, satellite service is being driven by Hollywood looking for efficiencies in feature film distribution. In Europe, alternate content is the primary benefit being sold.

Content
Alternate content provides cinemas with an additional revenue stream at little or no cost to them. It means they can attract new customers to their cinemas — people who do not want to see the usual super hero movies or romantic comedies. These attendees are prepared to pay a premium to view content that otherwise is inaccessible to them.

In 2004, Debra Kaufman of Regal CineMedia in the United States put all in perspective. “On average, on a Monday or Tuesday evening, five to seven percent of our seats are filled,” she said. “For the new forms of content, which take place early in the week, we nearly sell out. We can see anywhere from a 70 to 95 percent use of seats in the auditorium.”

These alternate types of content are:

Live-Live: Events that are screened as they occur using satellite broadcast technology. The performance stage anyplace in the world is linked with cinema screens anyplace in the world.

Delayed Live: Live-Live events that are time shifted so screenings take place at a more appropriate local time. For example, Mozart’s The Magic Flute, live from the San Francisco Opera in the evening, U.S. time, would be relayed at the appropriate delayed time for the Chinese audience.

Recorded Live: Some events are recorded then played back at a later time, usually within a month of the original event. For example, Where The Light Is: John Mayer Live in Los Angeles was recorded earlier in 2008 and played to cinemas across the U.S. for just one night on June 30, 2008. This enabled the producers to add more visuals and enhance the sound.

Archive: There is a wide range of material that is of interest to small groups that are not large enough to warrant showing on cable or broadcast TV such as old TV shows, movies, plays, and other entertainments that are distributed by satellite to reduce costs. Specialty programming for children is being packaged in North America and sent by satellite to about 150 cinemas every month.

Special Interest: Educational, marketing, sales, product releases, and religious/spiritual media: Cinemas are now generating additional revenue from special events. For example, on February 20, 2009 the Australian government’s Department of Youth linked cinemas in 10 cities and towns across the country for the Australian Youth Forum (see below).

3D
The networks will initially be capable of high definition transmissions, but can be easily upgraded to receive live 3D content. This is a rapidly growing area and will be a big revenue driver into the future. Gizmag, the print and online journal stated;

“The experience of 3D on the big screen when it’s done right...is absolutely gob-smacking. The effect is not only of watching an image unfold in glorious, full color and detail, but goes one further and puts you in the action. Instead of watching you are participating. And that adds a level of intimacy, excitement and immersion that is just not possible with boring old 2D projection.”

Home Grown Content
The events above are all sourced from existing content providers in the west and packaged for each country. While these will remain important sources of content, a larger market will be in the distribution of ‘home grown’ content. This will be compiled from a range of materials in each country. For example, pop music concerts, Meet the Director interviews for movie premiers, sports and other cultural activities

Australia
The Rural Digital Screen Network (RDSN) was designed to combat in-built structural barriers that prevent many Australian screen programs from reaching audiences outside capital cities. The RDSN uses digital content format standards, connectivity and communication infrastructure, and advanced data servers to create new business and revenue models. Another aim was to enhance small businesses in the Australian production industry, by providing greater opportunities to distribute their films to regional markets.

In 2007, the Australian Film Commission (now called Screen Australia) together with Global Vision Networks rolled out a pilot program to equip the eight RDSN cinemas for direct satellite reception. Over the next year, thousands of people in these rural communities experienced live transmissions of ballet, opera, and live theatre.

Satellite cinema in the Asia Pacific region has recently received another boost, with the entrance of Hoyts Cinemas. Hoyts is one of Australia’s leading entertainment corporations owning and operating 45 cinemas, with more than 400 screens and 75,000+ seats throughout Australia and New Zealand. Hoyts has commenced a launch of satellite capable screens across the market.

Due to the small size of the Australian market, care was taken to develop a satellite platform capable of meeting the current and future requirements of all major players. Both the Screen Australia network and the rollout for Hoyts are using high power Ku- transponders on AsiaSat 4 to deliver standard definition (SD) and high definition (HD) content. This is creating economies of scale as the market grows.

Global Vision Networks has partnered with OmniCast, the Australian distributor for the Toronto based International Datacasting Corporation. They are deploying the SFX4104 which features dual carrier operation for file delivery and live events, that has; built-in BISS decryption for ease of interfacing with transmissions from remote (SNG) sources; can decode both legacy MPEG2 and MPEG4 AVC (H.264) HD video; and is enabled for future upgrade using Sensio™ technology for live 3D alternate content.

Australian Youth Forum
Applications in this early stage are in the delivery of alternative content as well as a strong push into the Enterprise market. The first major event using the Hoyts network was held on Friday, February 20, when hundreds of young Australians from across the country attended the inaugural Australian Youth Forum (AYF) event – youTHINK – hosted by the Minister for Youth, Kate Ellis.

In an Australian first, the 10 event locations were linked by satellite, enabling young people in every capital city, as well as Cairns and Alice Springs, to participate in a truly national conversation.

youTHINK was created by young Australians, for young Australians, through the AYF Steering Committee. This group helped design an event that encouraged young people to not only speak out on important issues, but to also be a part of a conversation about practical solutions. The national satellite link into venues of importance created the largest ‘meeting room’ in the country.

“I want to thank each and every person who attended youTHINK for taking the time to come along and give their insights, and help direct responses to the issues that matter most to them,” said Kate Ellis. “It was a great experience to be involved in an event that came up with so many terrific new ideas and generated so much energy at every venue around Australia. From the Government’s perspective, youTHINK was a great way to engage with young Australians — on the issues that affect them, now and into the future.”

Enthusiastic participants exchanged much information during the event, with the discussion topics Violence and Safety and Contributing to our Democracy, creating passionate and intelligent debate.

The satellite link-up was launched by the dynamic Master of Ceremonies Fuzzy (Faustina Agolley) from Video Hits, who joined a crowd of around 120 young people at the host event in Sydney. Participants highlighted the importance of communicating to young people in ways that are accessible to them — through digital media such as YouTube and Facebook, to reach out to every young Australian, rather than only the “usual suspects.” In the past, such a forum would have been limited to a single location, rather than including everyone who wanted to attend. By employing satellite distribution and modern cinema facilities, the technology driving the event was transparent to the participants.

Asia
Hoyts’ initiative in Australia and New Zealand is being watched closely in Asia. In the northern spring and summer, a proof of concept for satellite enabled digital cinema is being rolled out in India and China. Its focus will be the distribution of a ‘Western’ alternative content to these markets, as well as distribution of home grown material. The scope of the project also includes test marketing in the corporate environment, and ongoing regulatory issues.

As Asia is a continent and not a country, many different languages, regulations, cultures, and geographies must be addressed to successfully implement any digital cinema project. Once all approvals have been received, contracts signed, and content sourced, then the real work begins with each country’s different price points, marketing strategies, and success rates.

As the business model is new, even in Europe and America, cinema owners and other stakeholders are carefully monitoring Global Vision’s efforts in Asia, the most populated place on Earth. They are eager for the aforementioned new revenue streams and keen to be the first in their markets to offer alternative content.