Talk About Digital Cinema

Peter Dobson
Chief Executive Officer, Mann Theatres

Peter Dobson

Beginning as an owner of an independent chain of cinemas in the UK, Peter Dobson moved through the ranks at Warner Bros. International Theatres, first as their film buyer for the UK and Europe, then as CEO of the company in the UK and Germany, and finally as supervisor of all Warner Bros. film buyers for all their theatres, worldwide. Five years ago, he became CEO of Mann Theatres, a circuit of 113 screens based in Los Angeles. In addition to his CEO role, he books and schedules all movies that play on all Mann screens.

On his beginnings.

In the UK, I had 19 of my own theatres, 30 screens, for about 18 years. The name of those theatres was 'ACE' because I couldn't afford signage when I first started. My first theatre was an old 'ABC' Theatre and I looked at the sign and I thought, 'If I just change the letters around - and buy an 'E' - I've got a name.' And when people asked: 'What does ACE' stand for?' I said, 'Alternative Cinema Entertainment'. So that's the story behind that one. And now at Mann, I have the 'luxury' of not only running the circuit, but doing the film buying as well, so it enables me to do my first love and that is FILM.

On the differences between multiplexes in the UK vs. the US.

In the UK, a multiplex might have two 450-seat houses, one 350-seat screen, a multitude of 250-seat auditoriums, and even some 180-seat auditoriums. But in the US, a multiplex tends to have a couple of big houses, one or two 250-seat auditoriums, and then all the rest are very small. Building small auditoriums may be more cost effective, but a lot of the public doesn't like seeing movies in them. For me, going to the movies is a 'sense of occasion' and a 'sense of occasion' means a big screen. But, that's all relative because if you are sitting in a small room, and the screen is wall-to-wall, it's a big screen.

On what he looks for when he previews a movie.

I don't see a movie until, normally, 10 days before it's released, but I try to see every movie I book; I see a lot of movies. And in the screening, I try to judge how long the movie is going to last in the theatre - and in which theatres I should play it. In any complex, in order to program every screen to attract the most number of 'bums in seats', you need to determine how long the movie is going to run - otherwise, you 'overbook' and you upset distributors because they're relying on you to show their new movie. So, you see the movie and make that judgment based on experience. You don't get it right all the time, but fortunately, most of the time, you do.

On movies playing differently in different theatres.

We can take three times as much money with a horror movie, for example, in one of our theatres in a specific location -- than we can take from the same movie playing in our theatres in other locations. Same number of seats, same movie, same date. So audience demographics mean a lot. On the other hand, when you've got a lot of Hollywood locations which are very important to the studio community, you really need to play everything you can -- but where you play it is determined more by the pedigree of the picture - the genre of the movie, the story, and other factors - all mixed with the 'star power'. To make money on a new movie, you need large marketing budgets and popular talent in those films. Although having said that, just having a star doesn't guarantee box office these days.

On booking multiplexes.

It's arguably more difficult to keep studios happy when you book an 18- or 20-screen complex than it is to book a 6-screen complex. With a very large complex, the studios know you can play everything and they all want to get on as many screens as possible. But, with a 6-screen complex, the studios understand that you can't play everything, and providing you are being fair to all the studios, they understand. We can't play everything, but we try to play all the big movies and the reason behind that is - the public expects to see the most publicized movie of the week, at their local theatre. In addition, if the studios are spending millions of dollars on advertising, they expect it to play in a lot of locations as well -- to amortize the marketing and print costs.

On how the business is run.

It's run on APSH -- Attendance Per Staff Hour - and that's analyzed every hour of every day for every week. How many people are buying tickets, and how many staff do you have to serve them - given that you do need minimums from a safety point of view. What happens is this: our operations people sit in the film meetings, so they know which films are opening, and they know from the film buyer what sort of attendance levels we're expecting. Based on that, they'll estimate the size of the audience they expect -- and the managers of the individual theatres then bring in the right number of staff during the different times of day, to make sure those guests are served. It's almost a science.

On concessions

At the concession stand - 'per-caps' - the average amount each movie-goer spends for concessions -- are one measure of how a theatre is doing, then you drill down into 'hit rate' - how many people buy at the concession stands vs. how many come in. In the UK, the hit rate is around 50-percent; in the US, it's about 30- 35 percent. I don't know exactly why that is, although theatres in the UK are largely on old industrial land, so people are not likely to have eaten before they come in. Here, they're in shopping malls where there are lots of places to eat.

On his digital experience.

We've been very active in digital and as far as our expectations go, we've had very few letdowns. We did early beta testing in a number of sites, first with 1K projectors from Barco and Christie and now we have 2K projectors in several sites and they are working very well; the early bugs are all ironed out. We're now using an NEC projector in the Chinese Theatre (in the center of Hollywood) and we actually have to pull down the light on our 75-foot screen; the NEC is very, very light-efficient.

On the audience point of view.

I think the more discerning audiences do care whether they're seeing film or digital, but I don't think that digital puts any extra bums in the seats. Everyone just wants the best possible picture. Certainly, certain movies lend themselves to digital and they look absolutely magnificent on the screen. But, if you're talking about a place like the Chinese Theatre, I sit upstairs at premieres sometimes, next to the projection booth and I look at that 75-foot screen and I often don't know if it's digital or 35mm film because the quality of both are so good. It's only when you hear the tick of the projector or see the change over cues that you know it's film.

On the operational differences with digital.

Today, in some locations, when the ticketing system is changed, the signage with movies and start times can also be automatically changed. So when we apply that technology more broadly, we'll be able to have all screens and theatres programmed by the film buying department - with all the trailers, ads, policy trailers, and everything else that goes before the feature. Once that's done, no one will need to get involved until we want to move a print to a different screen - and the film buying department would do that again, centrally. And there will be cost benefits, efficiencies, to doing that.

On other potential digital benefits

I think there's also an opportunity to keep some movies running longer, because at the moment unless you are really miserable to projectionists, you don't put more than two movies on one screen on any one day. But with digital, there would be an opportunity for a very popular family film in its 11th week to be on screen in the morning with a different movie in the afternoon and a third one at night. All without the projectionist having to lift heavy prints off the platter and, more importantly, not dropping the center out of the print and losing the show.

On playing the same movie on multiple screens.

With digital, you could easily play the same feature on two screens. You can do that with interlocking today but we don't like to do that because if the film breaks, you lose two shows. So, digital does give you the opportunity to add extra seats. But I emphasize -- you would need to do that with the agreement of the studios because if you put a movie on two screens, you also have to take something off -- and every Monday we contract with the studios for what's on each screen -- and they depend on that.

On the challenges with digital.

The challenges are delivery -- it's unnecessarily expensive to ship hard drives around. I would like to see satellite delivery when the technology is there to download it fast enough. And you have to have some system of delivery so you get the movies earlier, rather than receiving everything the night before. But, in terms of keys, it all works and if it doesn't, all you need to do is to make a phone call and you can get another key.

On alternative content.

For us, because of our locations are in Hollywood, in the studios' backyard, it's something that's very difficult for us to do. It's something I want to experiment with but thus far, I'm not impressed with the cost to the exhibitor. I think the only way it is going to work for us in the short term is to "four wall" (where a content owner 'buys out' a theatre for one night or a period of time). I don't want to turn away money, but I don't want movies to become a by-product of going to a theatre - I want movies always to be the main focus of the cinema experience and the "shop window" for the life of a movie!

On the future of theatres.

I think the movies will always represent a person's 'night out'. Today, with 'home cinemas', people are getting more 'into movies', they're more aware of the quality of a large screen experience and what the theatre provides is that 'big screen experience' with a 'big audience experience'. In a horror film, you're screaming with a large number of people; in a comedy film, you're laughing with a large number of people. And that experience is especially important to the youngsters, because they also can see and be seen by all their friends. And then it's up to theater managers to keep their theatres clean and comfortable, to give good customer service. And it's up to the studios to make the right product to attract people. Admission price-wise, I think ten or eleven dollars for two or three hours of entertainment for a movie that costs $100 million dollars + to produce will always be a good value-- especially when you compare it to going to a concert, a ball game or even a bar for a drink!