1. D Cinema @ Tipping Point Why we are where we are David W. Monk CEO European Digital Cinema Forum

2. Agenda The original motivation for Digital What did we learn? Where do we go from here?

3. The Original Motivation for Digital Cost savings for movie distribution. Production, Weight, Size, Shipping. Improved image quality. Consistency (print to print) Durability (over play-out time) Uniformity (over screen) Brighter, clearer, crisper colours.

4. The Original Motivation for Digital Better sound 24bit, 48kHz, 16 Discrete Channels Better Sub-titles Electronic Insertion Multi-lingual Programming Flexibility Alternative Capability.

5. What did we Learn? Digital presentation image quality is appreciated by movie industry. Producers, Cinematographers, Directors Production, Post Production. Distribution and Exhibition. Digital image quality enjoyed but not really valued by patrons.

6. Movie Patrons and Image Quality Movie patrons enjoyed digital content but wouldnt pay a premium ticket price. Higher quality presentation not a sufficient differentiator to justify upgrade. Exhibition needed support to fund the change – hence VPF.

7. Is Image Quality a ‘Don’t Care’ Perhaps more of an expectation than a ‘treat’. Presentation devices all improving  Computer LCD Screens  Large Screen TV  HDTV  Mobile Devices especially iPhone, iPad 2. Answer is ‘No’, but it is expected.

8. 3D is Valued 3D Experience is ‘valued’ Movies get bigger audiences Run longer. Patrons will pay for premium experience. Challenge is to ensure 3D aids the story and keeps the entertainment compelling. Patrons will support new experiences.

9. Impact of the ‘Tipping Point’ Not having Digital now becomes a ‘competitive deficiency’. End of film distribution in sight. VPF arrangements move to ‘last call’. Embedded features in Digital projectors no longer hampered by film constraints. Digital-only 2D releases become possible.

10. What’s in Pandora’s Digital Box? Higher Spatial Resolution. More 4K Releases? Beyond 4K? Higher Frame Rates Long standing photographic desire. Clearly demonstrated by JC at CineCom. Variable Frame Rates. Higher Contrast (Dynamic Range).

11. What’s in Pandora’s Digital Box? Larger Colour Space Using laser light sources Higher ‘lamp’ reliability. Flexible Programming. Support for interactive movie ‘Apps’. Added entertainment value. Advertising opportunities.

12. But... Projection Systems (projectors and servers) only designed to meet DCI/SMPTE standards. Projectors can provide Higher Spatial resolution – 4K Higher Frame rates 48 or 60fps per eye. Higher Bit Depth for greater contrast. More Colours with new illumination. BUT not ALL of the above at once.

13. But... Server bandwidth is also constrained. Many more models and implementations to review the limiting factors.

14. Meanwhile... SMPTE Interoperability is still 9 months away. 24fps per eye 3D is not yet fully standardised. 3D Sub-titling still a challenge. 3D Systems beginning to receive bad press in some publications.

15. Challenges... 3D Systems are still brightness challenged. Many below 6FL. 3D equipment is being left in light path in some installations. Silver screens are not helping 2D image quality and getting bad press. Lower cost solutions urgently required for smaller screens.

16. Call to Action Industry needs to agree on priorities for feature expansion in consideration of: Value as perceived by cinema patron. Cost of implementation and upgrade. Time to deploy. Standardisation and product qualification. Who pays and how change is funded.

17. Summary The Digital Majority opens many new possibilities for film makers, distributors and theatre owners. New capabilities need to be agreed and carefully managed to realise Cost savings for movie-makers. Features which are ‘valued’ by patrons. Commercial benefits for Exhibition.