Digital Cinema - How Stuff works

Digital Distribution

For the business side of the movie industry, the most compelling aspect of digital cinema is distribution. In today's system, production companies spend a lot of money producing film prints of their movies. Then, working with distribution companies, they spend even more money shipping the heavy reels of film to theaters all over the world, only to collect them again when the movie finishes its run.

Because the distribution costs are so high, production companies have to be extremely cautious about where they play their movies. Unless they have a sure-fire hit, they take a pretty big risk sending a film to a lot of theaters. If it bombs, they might not make their money back. (See How Movie Distribution Works for details.)

If you take the physical film out of the equation, things get a lot cheaper. Digital movies are basically big computer files, and just like computer files, you can write them to a DVD-ROM, send them through broadband cable or transmit them via satellite. There are virtually no shipping costs, and it doesn't cost the production company much more to show the movie in 100 theaters than in one theater. With this distribution system, production companies could easily open movies in theaters all over the world on the same day.

The digital distribution system also helps out the individual theaters. If a movie sells out, a theater could decide to show it on additional screens on the spur of the moment. 

Making it Happen

It's a given that at some point, digital cinema will replace the old film system. The question is when and how.

George Lucas and many other filmmakers say it's already time to make the switch to digital production, as its quality is comparable to film and it's much easier and cheaper. Others aren't ready to give up the old standby so quickly, noting that despite what Lucas says, digital video hasn't yet reached the level of film. As technology improves, however, digital video will likely find more converts. Eventually, digital production's main obstacle will be nostalgia and familiarity. Film has served Hollywood well for decades, and it will be hard to give it up.

Digital cinema makes a lot of economical sense on the distribution front, but it would involve huge changes in the industry. For one thing, distribution companies wouldn't have nearly as much work to do -- it's a good bet it would cut down their workforce considerably. Even if the result is a cheaper distribution system, the restructuring could be a major hurdle.

The other obstacle is piracy. To make off with an illegal copy of a movie on conventional film, a bootlegger either has to hold up a delivery truck or sneak a camcorder into a theater. In the first case, bootleggers have to use expensive machinery to make video copies, and in the second, the pirated tapes really don't look that great.

But if a movie were already in the form of bytes of data, anybody could make an exact copy by hooking into the data stream. To make broadband and satellite transmission feasible, the movie industry will have to come up with advanced encryption schemes.

To movie theaters, the main obstacle to digital cinema is money. Today, it costs somewhere around $150,000 to convert a film theater auditorium into a digital theater auditorium. Most movie theaters aren't going to do this unless they're compensated in some way. After all, the production and distribution companies will save millions and millions if the switch to digital is successful, but the theaters will be conducting business as usual.

In the end, the most important question about digital cinema is how it looks to the audience. Digital cinema's proponents cite market research showing that audiences generally prefer the look of digital movies to filmed movies, but many movie buffs aren't so sure. Digital cinema will have to win over a large majority of movie fans before it can completely take the place of film.

Another concern is the convergence of home entertainment technology and professional theater technology. Today, there is a huge gap in image quality between high-end digital projectors and home models, but they are actually built on similar technologies. As home theater projectors improve and drop in price, will people still bother to go to the movie theater? In the past, the difference between film and conventional TV was huge, and theaters still had a hard time packing in crowds. In order to keep the business alive, theaters may have to add a lot more than new projectors.

Fortunately, transmitting video digitally also opens up possibilities for improved surround sound, varied programming and interactive cinema. If production companies and theaters fully explore the scope of the new technology, digital cinema may be the biggest thing to happen to movies since the talkies.