Shindler's Site: Hail to the Prints!

By Marty Shindler

While content is, and always will be king, it is time to say, Hail to the Prints!

After resolving content issues and fees with the distributor, one of the most important determinants in an LF theater’s decision to book a film is the price of the 15/70 print. For too long the cost of a print has been exorbitant.

The rule of thumb has been that a 2D print costs the theater $20,000 – $25,000 and a 3D print is twice that. An 8/70 print of the same film is about 47% less than 15/70.

Considering that the exhibitor does not own the print, this is a substantial investment for both institutional and commercial LF theaters. And I believe that in many respects it has stymied growth in the LF industry and has prevented many operators from booking films that would have succeeded in their theaters.

Conversely, when a film is booked and fails to draw patrons, regardless of the reasons, the print investment looms large. This is compounded when the contract sets a minimum number of screenings. A poorly performing film thus represents a double whammy that the theater can ill afford.

Of course, one cannot be certain which films will attract an audience, and without a sufficient flow of product the market will not have the opportunity to decide. Lower print costs, along with other needed changes to the economic model, will allow exhibitors to book more films and reach wider audiences.

Therefore Technicolor/CFI’s recent announcement to lower the cost of prints must be hailed by everyone in the LF food chain. Perhaps CFI’s own words say it best: "We are doing this as our part to answer the cost challenges that face the entire Large Format industry and to contribute to the overall need for improved economics to support new growth and future success."

CFI cut its prices by 25%, dropping the lab costs for a 40-minute print from about US$12,000 to under $9,000. Distributors must also pay for quality control and inspection, sound tracks, and shipping, but I assume there is also some markup in those $20,000-25,000 print charges.

Thus distributors could choose to pass along only the lab savings, or they could help the industry even more by cutting their markups somewhat. I suspect the markup they lost would be made up by additional bookings. It’s just a question of which business they would rather be in: print handling or film production.

Lowering print costs should allow theaters to increase their bottom line, assuming all other variables remain equal. As that process moves forward, the box office allocation between distributor and exhibitor can also shift back toward the producer. It will require a concerted negotiation between the two sides.

The benefits are not limited to reducing the price of release prints. Lowering laboratory costs throughout the production process will benefit producers. As these costs come down, funds are freed to enhance production values and marketing.

Even for those who are not directly affected, there could be an indirect positive impact as changes to the overall financial picture trickle down. By lowering the investment threshold, a much needed stimulus could become available to all members of the LF community.

The supply and demand equation is taking an important leap forward. Let’s all cheer this change: Hail to the Prints!