How Technology is Helping Cinemas Compete in a Post-Pandemic Climate

Photo Credits (l-r): GDC Technology, D-Box, Dolby Laboratories

Cinemas have been fighting competition for the public’s leisure time for more than 70 years, beginning with the rise of television and continuing with the growth of home-entertainment options. But the movie theater business is currently facing one of its most daunting challenges ever, now that the pandemic has shattered exclusivity windows, and a return to “business as usual” seems highly unlikely.

Throughout the decades, cinemas’ most important survival strategy has been technology, from the wide-screen formats born in the 1950s to advancements in sound to the digital revolution and the creation of luxury auditoriums offering comforts you can’t get at home. As theaters attempt to recapture some semblance of normalcy, we asked leaders in cinema technology to share their thoughts on how advanced tech can help persuade the public to return to cinemas when so many big-budget movies beckon on their home screens.

 Man Nang Chong, founder, chairman, and CEO of GDC Technology Ltd., comments, “Technology has always played a big role in helping movie theaters constantly wave off threats from other forms of watching content. At the same time, technology has kept moviegoing an affordable out-of-home entertainment choice. Although the pandemic gave rise to narrowing the exclusivity window, it did not keep GDC from continuing to technologically improve the moviegoing experience. As an industry, we cannot allow technology to stop simply due to changing business models. Because we constantly listen to the creative community, distributors, and exhibitors, there is always a new idea to improve the big-screen experience on our drawing board. For example, at GDC, we will introduce several new hardware and software products at CinemaCon, including our smallest, lightest, and quietest laser projector—Supra-5000, designed for the emerging mini-theater concept.”

Mark Mayfield, director of global cinema marketing at audio leader QSC, says this is the time to upgrade. “There are many ways that theater operators can use technology to further differentiate the experience they can deliver in the theater from what people can create in their homes. First and foremost, evaluate the presentation quality inside your theater. Are both the sound and projection systems functioning at their best potential? If not, use this post-pandemic period as sort of a re-set, to recalibrate or upgrade your equipment so that when patrons return to the theater, the difference between streaming a movie at home and seeing it in the theater will be more dramatic and persuasive.

“Also, you can use technology to expand the use of the theater for applications other than showing feature films. Even a minor investment in conferencing and collaboration technology can let you turn the theater into a presentation space with remote viewing capability for business meetings and celebrations. Use streaming technology to your advantage inside the multiplex by combining rooms to create as large or small of a ‘virtual’ space that your rental customers need, by streaming from room to room. Also, this is the perfect time to explore ‘event cinema.’ All of this can reduce your reliance on first-run feature films. Also, network technologies are available that offer ways to streamline whole building operations, allowing centralized or remote monitoring and control of all theaters, public spaces, and building systems, offering many ways to increase efficiency and save money.”

Doug Darrow, senior V.P. of Dolby Laboratories’ Cinema Business Group, cites the role of premium large-format venues like his company’s high-tech Dolby Cinema concept in luring customers back to cinemas. “From an industry perspective, we anticipate the shift to a shorter theatrical exclusivity window will increase the significance of PLF offerings to exhibitors—allowing them to capture incremental box office while providing moviegoers with the premium experiences they crave. Particularly as we see vaccination rates increase, and exciting new content release in theaters, we expect Dolby Cinema and all PLFs to be a vital part of the resurgence of the industry. Prior to the Covid-19 pandemic, premium large format had the highest PSA of any screen in the world. Coming out of Covid-19, we are seeing that trend pick up where it left off. Over F9’s opening weekend, PLF screens generated 24 percent of the total box office, despite only accounting for 3 percent of all screens in North America. And moviegoers are continuing to return to cinemas.”

Brian Claypool, executive V.P., cinema, at venerable projection company Christie, is confident exhibitors can weather this turbulent period.“Following the pandemic, the exhibition business will see a change. It is true that there will be shorter windows; however, that is a reality that many had already expected. The pandemic has simply increased the velocity at which this change occurs, but the underlying drive that creates the demand for cinema remains strong.

“People want to experience the richness offered by the presentation of a compelling story together, and technology has always been a tool that allows exhibitors to do this. We will continue to work with our exhibition partners to ensure we bring solutions that offer an experience better than anything the audience can get at home, and at a price that is economically viable for their business.”

Sean Spencer, V.P. of sales and marketing at leading 3-D provider RealD, declares, “The reduction in theatrical windows increases the options for consumption of content, but cinema is more than content. It is a venue that combines the best in modern technology with the social engagement that can only be enjoyed by watching a wonderful movie in a packed auditorium. Now, more than ever, we in the theatrical industry need to remind customers just why cinema is so special, and premium experiences will be a large part of that. Laser projection, beautiful screens, booming sound, and, dare I say it, 3-D content—cinema brings all this together, combining it with an engaged audience focusing all their attention on the best Hollywood and world cinema can offer. The big-screen experience simply cannot be replicated at home.”

Jeff Kaplan, national account manager, digital cinema, at Sharp NEC Display Solutions, notes, “Technology is a main factor in driving consumers to the theater. As we discovered during the pandemic, we can all stream the latest from Netflix or Disney-Plus on our TV or home theater setup, but nothing can compete with 4K projection on a 70-foot screen. Overall, it comes down to capex versus opex. With so many theaters recovering from a year of lost revenue, many are trying to quickly replace projection equipment for the lowest cost. However, without evaluating, the operating costs associated with the purchase could be costly. For example, the operating advantage of laser technology is a higher-quality image at a lower overall cost of ownership. Assessing the overall costs could drastically change the ROI of a projector purchase and is an important component for theater owners to consider in order to survive and thrive.”

Sebastien Mailhot, president and CEO of motion-seating company D-Box, observes, “Moviegoers who have been confined for a long time are now looking for an entertainment experience that is different from what they can experience at home. They will go back to the cinema, but they want a premium experience, which often only technology can offer them. Whether it’s the size of the screen, the enhanced sound experience, or haptic movement technology, they want to experience something unique that exhibitors who own the technology can bring.”

Claypool touts the role of cinema technologies like Christie’s projectors with RealLaser illumination in clearly differentiating an audiovisual experience from what guests experience at home. “We also believe ensuring that audiences have a consistent, high-quality experience is key. Images need to be perfectly focused and framed on screen. Light levels need to remain consistent, as do the audio components in the auditorium.”

He continues, “Ensuring guests feel safer returning to theaters is also top of mind, which is why Christie has developed Christie CounterAct commercial U.V. disinfection fixtures with patented Care222 technology, which inactivates 99 percent of surface pathogens using 222 nm filtered light, while people are present. It is specifically designed for rooms with high ceilings, making CounterAct perfect for cinema.”

Another key factor in attracting patrons to cinemas is technology that conveys an enhanced experience unique to big-screen venues. 3-D, which entered a whole new era with the release of Avatar in 2009, is certainly one of those enhancements. RealD’s Spencer contends, “Without question, 3-D will be a part of the resurgence in cinema, for a couple of key reasons. The first I mentioned previously, as part of the premium technology offering that differentiates theaters from the home. Of course, 3-D is not the only factor here, nor should it be. The drive to improve the cinematic experience has been a continuous one, and we are proud of the role 3-D has played and will continue to play. Secondarily, 3-D offers the opportunity to generate a premium ticket price, which is vitally important, especially when occupancies are limited and maximizing revenue from each available seat is key. We saw very promising results with Godzilla vs Kong, with the number of 3-D showtimes actually increasing on week two due to the demand. And we have a solid slate of great 3-D titles in the pipeline, which demonstrates that the studios remain committed to the format.”

Motion-seating and 4-D effects are another increasingly popular enhancement. “Immersive haptic technology enhances the cinematic experience,” says Mailhot. “Moviegoers are looking for a different experience from the one they had during the pandemic. The D-Box haptic technology certainly helps attract moviegoers looking for the enhanced experience that movies, such as most recently F9, can provide.”

With theaters gradually recovering from the pandemic, what advice can our technology gurus offer? Mayfield responds, “The obvious one—be sure to have your sanitization and safety measures in place. The public needs to feel safe and confident returning to the theaters if we’re going to get back to pre-pandemic capacities and revenue. Beyond that, objectively evaluate your presentation experience, and make improvements now. Then use this period to promote the experience you can offer that patrons cannot get at home.”

Chong observes, “The best advice we can give movie theaters is to always deliver the best possible experience. Walt Disney said it best: ‘Do what you do so well that they will want to see it again and bring their friends.’ Keeping guests coming back again and again has to consist of a totally positive experience, from booking tickets to parking your car to purchasing concessions to maintaining a comfortable temperature in the auditorium. As a technology provider, our best advice is to constantly monitor and maintain your digital cinema equipment to ensure the best possible experience. The days of talking about movies around the watercooler on Monday morning are gone. In today’s social media world, the word spreads fast about a great movie, including instantly sharing images of the amazing experience with family and friends.”

Claypool adds, “Make sure that your equipment is working optimally. Because now, more than ever, when audiences return, you’ll want them to have an experience to remember. We have prepared a checklist [christiedigital.com/help-center/reopening-cinemas/] to help keep theaters ready for showtime. Staying at home is the easy choice. We want moviegoers to know that choosing to watch it at the cinema is the right one.”

Dolby’s Darrow again advises exhibitors to offer a premium experience. “Moviegoers have a lot of choices when deciding where to spend their money. Over the past year with theaters being closed down, consumers experienced their entertainment at home or on-the-go. Because of this shift in consumption, the importance for exhibitors to deliver great experiences has never been more imperative than it is today. The big-screen experience has always been the choice of creatives and remains the premier venue in the minds of most consumers. The emergence of the PLF solutions that include immersive audio and HDR are giving moviegoers a higher-quality experience every time they step inside these cinemas. Because of these expectations, it is more important than ever for exhibitors to invest in premium experiences to counter alternative offerings.”

Spencer emphasizes quality control. “Theater owners know their business better than we ever will, but there are some areas we are speaking to our partners about. … Customers expect a premium experience If they are being asked to pay a premium price—so we as an industry must focus on getting that technology right. For 3-D, that means ensuring the brightness on the projector is at the optimum level and the system is aligned correctly. With both of those factors addressed, the customer will enjoy deeper, sharper images that are comfortable to watch.”

He continues, “From a marketing perspective all companies need to focus on their brands and what makes their business special. This applies to everyone in the industry, not just theaters. What makes your cinema different from everyone else and focus on those core competencies with the advertising messaging. Previously, we may have relied on the studios to generate demand with their theatrical campaigns, but there is an extra job to do now. We also need to convince the customer as to why they should select the movie theater as their method of consuming the latest blockbuster. A focus on those competencies means that we can deliver on the promise of our marketing. At RealD, we offer the best 3-D in the world. We have to make sure that message and experience is delivered consistently, and the same is true for theaters.

“We are also discussing hygiene, which has never been more important in reassuring customers they are in safe hands. We must recognize customers’ health and safety concerns, creating procedures and messaging to calm any fears they may have. We have produced marketing materials letting patrons know that our glasses are U.V.-sanitized and hygienically, individually wrapped. This has always been the case, but until recently we have never felt the need to communicate these facts to the final consumer.”

We couldn’t resist asking our experts for their forecasts about the cinema business post-pandemic.

“At GDC, we are bullish about the health of cinemas in 2022 and beyond,” Chong affirms. “We foresee big changes coming to the big screen. The naysayers have been predicting the demise of cinema for nearly 70 years, and not one prediction has come true. The pandemic slowed the industry down, but there’s a new generation of filmmakers that still understand the best venue to showcase their story is the big screen. It is our job to ensure theater owners have the technology to bring their imagination to life by displaying the content exactly as the young filmmaker intended. It’s why we feel watching a movie on a handheld device or a streaming platform will never replace a night out at the movies. However, it’s up to us as a technology provider to continually improve the moviegoing experience with technological advancements targeted at consumers, such as cinema-on-demand platforms like GDC’s GoGoCinema, where the consumers select the movie they want to see, where they want to see it, and when they want to see it.”

Says Darrow, “Dolby truly believes in the power of shared experiences, and that the cinema is a unique environment that can’t be replicated. We know Dolby Cinema provides a transformative premium offering, where consumers can deeply connect with the story onscreen. With the reopening of cinemas, we feel that 2022 box office numbers will be strong and will only continue to grow over time as possibilities for additional high-value content increases. We see cinemas focusing on the quality of the experience as well as beginning to offer more alternative events such as sports and music, simulcasted staged events, and gaming as the industry drives for more immersive experiences in a shared, community environment.”

QSC’s Mayfield observes, “If you look back at the 125-plus years of theatrical exhibition, it has always been a cyclical business that’s sensitive to technological, social, regulatory, and many other types of historical events. But it always comes back, often by implementing new technologies that increase the appeal and that enhance the moviegoing experience. Obviously, I’m one of those who is bullish on the recovery and rebound of the exhibition industry. But there is no return to ‘business as usual’—it will be necessarily different. Exhibitors shouldn’t fear this; differentiation is a powerful competition strategy, and it may be the key to survival.”

Christie’s Claypool declares, “We have always been, and continue to be, in cinema for the long term. We are stoic believers in the experience that only cinemas can offer. While the next two years may be a bit rough as exhibitors hit hard by the financial impact of the pandemic find their footing, we’re here for them. In fact, we are already seeing positive signs of recovery with studio releases we’ve been waiting over a year for that are finally around the corner, and box office returns continuing to improve as people that have been resilient during the pandemic are returning to spaces they love.”

Sharp NEC’s Kaplan is also bullish. “In my opinion, the future of cinema is a healthy, more profitable industry. Post-Covid, they are expecting 25 to 30 percent permanent theater closures. With less competition in physical theaters, there is an opportunity to create the best experience for consumers. I liken it to this analogy: Everybody has a kitchen in their house, yet they still go out to eat. People crave a shared experience and the memories of going to the movies. There is just something about the experience of buttery, salty popcorn and a large fountain drink that will continue to drive consumers to the theater for generations to come.”

RealD’s Spencer predicts, “The cinema will rebound. The opening weekend of F9 saw the best box office result domestically since before the pandemic, and there is a backlog of blockbusters waiting to hit theaters in the next six months. More than that, I believe that the increased competition will actually improve the theatrical experience in the long term, by making everyone in our industry focus on the areas that matter to customers, and that we do better than anyone else. We owe it to future generations to give them the opportunity to connect with movies in the way that we all do, and it simply will not happen without cinema. We need to make it special to keep it alive. We need the anticipation as the house lights drop. We need wonderful, pin-sharp projection that knocks our socks off. We need sound so loud we feel it in our chest. We need to laugh, cry, and be scared with an audience of strangers. We need the cinema, and right now the cinema needs us.”

Photo Credits (l-r): GDC Technology, D-Box, Dolby Laboratories

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