Theaters weigh pros and cons of 3D conversion

By Nicole Norfleet
Washington Post Staff Writer
Monday, April 19, 2010; 17

A string of 3D movie hits this year has independently owned theaters debating whether to splurge on new projectors, special viewing glasses and other gear to show the special flicks.

Adam Greenbaum spent about $150,000 in February to buy equipment for his two screens at the Visulite , in Staunton, Va. His timing paid off with the recent 3D releases of "Alice in Wonderland," "How to Train Your Dragon"and "Clash of the Titans". Typically, the Visulite shows art films, and because there are often few new releases in the spring, ticket sales can be slow. But in March, the Visulite raked in more than $72,000 worth of ticket and concession sales, a nearly 400 percent increase from last year. It helped that a nearby competitor, part of the Regal Cinemas chain, has yet to add new projectors.

"I knew that in the near term it was the right thing to do. . . . For me personally, I didn't want to wait," he said. "We have been in this position where every April we go off this cliff."

Theaters across the country are weighing the pros and cons of renovating their screens, said Patrick Corcoran, director of media and research for the National Association of Theatre Owners. Out of 5,942 member theaters, 10 percent of screens are 3D capable and the number if growing. Currently, 100 to 150 screens are being converted a month, he said.

Interest in 3D films was fueled by the enormous success of director James Cameron's "Avatar," which has grossed more than $700 million in U.S. theaters alone since its December release, making it the biggest selling movie of all time. Movie experts point out that one of the reasons why "Avatar" has topped the list is because of the higher ticket prices charged for 3D movies. Recently, ticket prices for admission to 3D films have spiked at some theaters.

For about a decade, the movie industry has discussed conversion from film to digital not only to enhance the viewing experience but also because it is cheaper for studios to distribute movies in a digital format, Corcoran said. In a move to encourage more digital conversion, film studios reached a financing agreement last month with AMC, Cinemark and Regal, some of the largest movie chains. Studios will pay virtual print fees to theaters to help with costs of installing digital projection equipment.

The process of going digital typically costs $75,000 per screen. Complete 3D conversion, which can cost another $25,000 to 30,000, requires a 3D lens used with the digital projector, viewing glasses, and possibly silver screens, Corcoran said. Prices for conversion vary by the size of the theater and which digital system is used.

Out of the more than 50 theaters in the Washington D.C. area listed on Fandango.com, less than half show films in 3D. Most of the theaters that are able to show 3D are part of big movie chains. The only Imax theaters in the District are at museums.

For some smaller theaters, the inability to show 3D films makes it harder to compete.

The week that "Clash" premiered, the Old Town Theater in Alexandria, Va., played the movie and "Alice" on its two screens, but it did not show them in 3D like the Regal and AMC theaters in town. A large reason why theater owner Roger Fons has not made the switch to digital is because of the cost, but another issue is the lack of space in his projection room for another projector. The theater is more than 90 years old. Fons has turned it into a dinner-and-a-movie spot where patrons are served food and even alcoholic beverages after the movie starts.

"We have a different niche. . . . It's just a different way of doing business really," he said.

Cost is the major deterrent for a lot of independently owned theaters. Mark O'Meara owns University Malls Theatres in Fairfax. He said he wasn't willing to invest $100,000 to go 3D because University Malls is a second-run theater, meaning that it doesn't play movies until long after they have premiered. His other Fairfax theater, Cinema Arts Theatre, is an art house, and art movies, O'Meara said, are not being released in 3D. He said he is considering digital conversion in the next few years to coincide with the renovation of the strip mall where his theater is located.

O'Meara, who owned a deli before opening the theater almost 20 years ago, said he got into the theater business because of his passion for movies, not necessarily because of the money.

"I did this because it was empty, and it seemed like a challenge," he said.

Corcoran's organization is concerned that a digital divide of sorts could open up if smaller theaters are unable to pay for new equipment. His organization formed a cinema buying group that is currently trying to negotiate a deal with studios to help with funds for the digital conversion.

"With the kind of numbers that 3D is bringing in right now, it is going to make up for the costs of 3D equipment in a relatively short period of time even if it only lasts for five years," Corcoran said.

Another issue is that theaters with multiple screens may only be able to update one, meaning that in the case of back-to-back 3D films, movies are prematurely pushed out to make room for the most recent release. There are 14 remaining films that are slated as 3D releases this year.

At the Visulite in Staunton, even though people were still coming to see "Alice" in 3D, the theater had to stop playing it to make room for "Clash." Despite some of these logistical hiccups, Greenbaum said he still thought the change was an exciting opportunity.

"I think that in this industry, at this moment in time, with digital, with people's home access to all sorts of entertainment [it] presents a big challenge and this huge opportunity to completely reinvent what a movie theater is."

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