Norway on the brink of a digital roll out an overview
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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

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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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