Advantages of digital distribution (adapted from an American article)

Technology is helping tomorrow’s cinemas overcome some of the challenges that are squeezing the profitably from cinema exhibition today. Some of those challenges include:
The Challenge

High Distribution Costs – The cost of sending films out to theaters across the country and around the world is fixed today based on the cost of the film prints themselves, anywhere from £1200-2000 per cinema.
No Security – Distributors have little control over a film once it leaves their facilities. They have to hope that it’s delivered safely to the appropriate theaters and doesn’t fall into the wrong hands or is damaged along the way.
Degradation Issues – As a movie is screened it becomes progressively more scratched and dirty, eventually demanding a replacement print.
Limited Programming Flexibility – Currently cinema owners are only set up to receive 35 mm films. Since the cost of film production is so high there’s little content beyond major independent and studio movies that can afford to take advantage of a theatre screening.
Inflexible Advertising – Advertisers love advertising in theaters because they have a captive audience. But today’s theater advertising is limited to slide shows and rarely a filmed ad. But again, given the costs of film distribution not many advertisers can afford to send a 35 mm reel to each theater and even if many advertisers did so, the theater owners aren’t equipped to switch from one ad reel to the next.



The Solution

Digital distribution and exhibition of content in tomorrow’s theaters will overcome many of these limitations.
Streamlined Distribution – The distribution process will no longer involve bulky expensive film reels. Films can be sent digitally over the IP network to targeted theaters without ever having to duplicate a 35 mm reel. This streamlined distribution will pave the way for new programming options including concerts, sporting events, distance learning and more. Theater owners can program content quickly and easily, moving content from one auditorium to many, meeting market demand in a way they are currently unable to.
Integrated Digital Rights Management – Digital theater content will be secured before it ever leaves the content owners facility. DRM will enable tracking and license serving so theaters and content owners know exactly when and where the content is accessed.
Digital Preservation – The one thousandth time a digital movie is screened provides the same quality as the first time. There is no breakdown in the digital file as there is with film.
Demographically targeted advertising – Digital ads can be served from one location and targeted to specific theaters based on content being shown in that theater to a particular demographic.
The benefits of moving to digital distribution to theaters are clear. The costs for theater owners have been historically very to purchase the digital projectors and other equipment but some smaller theaters are finding that they can begin to achieve some of the benefits of digital cinema with off the shelf hardware and software.
Conclusions
Technology is changing the rules of the film industry just as it did for the music industry. With the growing interest from consumers to get movies and video content in different ways with different options, filmmakers and distributors are turning to technology to meet their demands. New technology like Windows Media 9 Series strives to achieve higher quality, greater efficiency, and greater audience reach all while driving down costs. All of these benefits open up new distribution opportunities to the film industry.