Studios, Theaters Reach Agreement On Digital Conversion
The impasse between Hollywood studios and theater chains over who should pay to convert theaters to digital projection may have ended Wednesday with an agreement by the studios to pay each theater $800 to $1,000 for each print they deliver on digital media instead of film. Although the cost of a digital print is negligible, the payment still represents a savings since film prints can cost as much $3,000 each to process, distribute, store, and dispose of. The "virtual print fee" would be used to cover the theaters' costs to install digital projectors, which cost $70,000 to $100,000 each. Once the projectors are paid for, the payments would cease. Initially, the theaters had said that they planned to use the studios' commitments to borrow $1 billion to pay for the conversions, but they acknowledge that the current credit crunch could delay such plans. In an interview with today's (Thursday) Los Angeles Times , Julian Levin, head of digital exhibition for 20th Century Fox, commented, "I'm hopeful that the financial climate will get stabilized, [and credit] will loosen up a little so that the funds can flow and become available for the conversion."