Greasing the Rollout of Digital Distribution of Movies

But it took more than the distribution costs savings to make the sale — but 3-D movies? Really? Hollywood studios agree to digital rollout (pdf)

Five Hollywood studios have agreed to help pay for a $1 billion-plus rollout of digital technology on about 20,000 movie screens in North America, a precursor to showing movies in 3-D.

Digital Cinema Implementation Partners, a consortium of major theater chains, announced the deal Wednesday. The rollout in the U.S. and Canada, covering about half of all screens, is planned to start early next year.

To help offset the costs — about $70,000 per screen — the studios plan to pay the consortium slightly under $1,000 per movie per screen, roughly the same amount it costs them to print and ship a celluloid film copy.

Adding digital equipment is the critical first step in the technological upgrade to being able to show 3-D movies.