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Norway – on the brink of a digital roll out An overview. Presentation Oslo 03.05.10 Jorgen Stensland Director of Consultants Film & Kino. Norways Cinemas. 4,5 million people, annual admissions about 12 million. 230 Cinemas/420 screens & ambulatory cinema.

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norway on the brink of a digital roll out an overview

Norway – on the brink of a digital roll outAn overview

Presentation Oslo 03.05.10

Jorgen Stensland

Director of Consultants

Film & Kino

norways cinemas
Norways Cinemas
  • 4,5 million people, annual admissions about 12 million.
  • 230 Cinemas/420 screens & ambulatory cinema.
  • 50 Cinemas have 90% of the business.
  • Unique cinema structure cinemas/culture houses nationwide.
  • Political authorities agree that people should be offered culture where they live
  • Digitalization will benefit smaller cinemas and give them new opportunities
film kino
FILM&KINO
  • Hybrid organization. Owned by the Norwegian Local municipalities
  • Interest organization for the Cinema and Video industries
  • Collects a tax on behalf of the government: The Norwegian Cinema and Film Fund. Tax on cinema tickets and DVD.
  • Approximatly 80 mill NOK yearly (10.4 mill Euro)
pilotprojects tested
Pilotprojects tested
  • Technical issues, how the projects use formal testing and routines for interoperability, automatization, functionality and moving of equipment.
  • Organizational issues: How the bigger cinemas in the region can help the smaller ones. (support, advisory work)
  • Digitizing multiplexes to understand and evaluate how a theatre will function with most screens digitized in regard to content and revenue
digital roll out
Digital Roll-out
  • Total roll-out costs are estimated at 400 mill NOK (50,6 mill Euros).
  • 40 % of the roll-out costs will come from VPF-agreements.
  • Total contribution from Film & Kino and the cinemas will be about 60% of total costs.
  • Film & Kino will contribute with 100 mill NOK.
  • Film & Kino are guarantors of the whole agreement in regard to a financial institution.
overall model structure simplified
Overall model structure (simplified)
  • Master leasing agreement
  • Lease payments
  • VPF invoice/payment

Distributors

Film & Kino

Financial institution

Technical and commercial advisory board

(Representatives from distributors, F&K, system integrators and theatres)

Project organizationSupporting roll-out process and information sharing

  • Selection of system integrat-ors through public bid
  • Master agreement for standard digitization packages
  • Payment NOC/service
  • Reporting
  • Net payment/ contribution
  • Reporting

System

Integrators

(equipment suppliers)

Exhibitors

(cinemas)

  • Payment for extra equipment

Payment for digital system

benefits after roll out
Benefits after Roll-out
  • Increase in premieres and early access to popular films (average time in small cinemas to get a copy of a new film in Norway is 45 days)
  • Easier and Cheaper distribution
  • Alternative Content.
  • Better quality on the shows. ”Only first runs”
  • Increased business! Lillesand Cinema (NDA) had an increase in business of 26% 2006 with only a few digital premieres.
  • Not only for cultural purposes. Local cinemas generate business for restaurants, shops, cafes etc. A study in Bergen (population 350 000) stipulates this to 100 mill NOK a year (13 mill Euro)
successfactors for total rollout
Successfactors for total rollout
  • Political support on governmental, and local levels (and European).
  • Financial support through the political level.
  • One project leader must plan and control the process.
  • Joint venture: All participants in the business chain must cooperate.
current status
Current status
  • Deals with 6 studios signed
  • Agreements with cinemas and System Integrators signed.
  • Film & Kinos contribution not considered state aid by the European Surveillance Agency in a preliminary assessment.
  • Public tenders finished in february.
  • Roll-out starts may/june.
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