NATO calls for equity for independent theaters
Following the agreement five movie studios signed with the three largest theater chains to pay virtual print fees to help defray the cost of buying digital cinema projectors, the National Association of Theater Owners called on the studios to sign a similar agreement with the hundreds of independent cinemas around the country.
The theater chains, AMC Entertainment Inc., Cinemark and Regal Entertainment Group negotiated the agreement with 20th Century Fox, Lionsgate, Paramount Pictures, Universal Pictures and Walt Disney Studios.
The studios will pay a vitual print fee of $800 to $1,000 per film to help the chains convert to digital projection. The average film print costs the studios $1000-to-$1500 plus shipping while a digital print can be sent on a $200 to $300 hard drive which can be used again. Digital projectors cost $70,000-to-$100,000 twice as much as 35mm projectors. The studios are promising to refund the chains their savings over film prints for the next three-to-five years, or until the projectors are paid off.
Financing through JP Morgan and the Blackstone Group will allow the three chains to quickly convert up to 20,000 screens, or more than half the country’s 38,000 auditoriums.