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Premium large format (PLF) is one of the fastest-growing and most active areas of cinema exhibition, with significant potential to grow in size over the next ten years. The business environment for PLF cinema is also becoming increasingly competitive amid a startling array of brands and technologies.
The total digital premium large format (PLF) cinema market reached a total of 1,623 screens worldwide at the end of 2014, an increase of 15.8% from 1,401 just six months earlier. This total includes both the increasing array of exhibitor-developed and branded PLF screens plus a now-growing proliferation of global technology brands, led by the long-established large-format brand IMAX.
Exhibitor-branded PLF was one of the fastest-growing segments, rising 22.3% to finish 2014 at 926, up from 757 screens as of mid-2014. Of the 169 net new exhibitor PLF screens worldwide, the largest net gain can be attributed to Asia-Pacific (78 screens) and Western Europe (3
, which actually recorded more net additions than North America (31), albeit from a lower base.
In Western Europe, exhibitor PLF screens more than doubled by the end of 2014, driven by new screen openings in the major Euro territories. The U.K. was one of the fastest-growing markets, with PLF screens doubling over the six-month period from 11 to 22, as all major exhibitors increased their provision of PLF screens, led by Vue Entertainment with 12 VueXtreme screens. The U.K. is now one of only three markets (alongside Australia and North America) where all top five circuits have their own PLF offer. Pan-European operator Kinepolis also confirmed its reputation as an innovator, launching Laser Ultra, the first exclusively laser-based PLF brand by a circuit, combining laser projection from Barco and Dolby Atmos immersive sound.
In contrast, Central and Eastern Europe remains the most underpenetrated region for exhibitor PLF. Global brand PLFs including IMAX as well as RealD’s LUXE umbrella brand account for the vast majority of PLF screens.
North America, the largest market for exhibitor PLF screens, finished 2014 with 408 screens. Although growth has steadied, activity is still dominated by the major circuits including Regal Entertainment’s RPX brand and Cinemark’s XD screens.
China remains the second-largest market for PLF screens globally, with a combined 124 screens derived from three PLF brands: China Film Giant Screen (CFGS, originally known as DMax, with 73 screens), Poly Film’s Polymax (14 screens) and Wanda X Land (37 screens) with data up to the end of 2014. The market there is growing rapidly, up from 82 screens as of H1 2014. CFGS operates as a local Chinese PLF brand with installations across multiple circuits, but has yet to classify as a truly international PLF brand.
There are now a total of 81 individual circuits worldwide (not including multiple brands under cross-territory ownership) with active PLF screens, up from 72 just six months prior.
Global technology brands proliferate
Competition in the globally branded PLF sector has intensified following the launch of Dolby Cinema in late 2014, a new premium concept that combines Dolby proprietary technologies (and a deal with Christie for laser-illuminated projectors) for image quality (with HDR), immersive sound and intrinsic design features. Barco Escape is also a new contender in this space, based on a novel panoramic screen format (similar to CJ CGV’s Screen X) that requires specially prepared content for the three-screen configuration (one large screen at the front and two panels at the sides). This fits into the wider PLF category based on its superior technology attributes, an associated upcharge and experiential nature of the screen.
CJ CGV also launched an industry-wide proposition for its Screen X technology, initially focusing on China and the U.S. (where it also has screens). There were 75 screens in 44 sites with Screen X installed in Korea at the end of 2014. RealD Luxe, established in 2013 as a global umbrella brand for the PLF experience, had a total of six screens across Russia and Bulgaria, plus a number scheduled to open in China later in 2015, for a total of around 30 screens under contract.
Although successful PLF includes a mix of technology, marketing and service, the technology element is a key battleground in this space, with both IMAX and Dolby launching laser-based projection systems (in conjunction with Barco and Christie, respectively).Dolby will therefore be the first exclusively laser-based platform, resetting the bar for the PLF sector in general.
Together, the non-IMAX and non-exhibitor global PLF screens accounted for just 2.6% of screens in the wider global PLF category, but this share is likely to increase significantly following the signing of a major 100-screen (over ten years) deal between Dolby and AMC Entertainment in the USA. The new screens will be branded Dolby Cinema at AMC Prime, setting up a new era of collaboration in branding and design features.
The maximum number of parallel PLF brands operating in a single site has traditionally been two (exhibitor PLF brand and IMAX), although with scope to potentially broaden this with multiple configurations of brands throughout a circuit as the sector’s segmentation grows. For example, Cinemark has Barco Escape screens either in combination with IMAX or its own private-label XD screen, but not all three side-by-side.
Globally, PLF screens accounted for just 2.3% of the total allocation of digital 3D screens worldwide (67,226) as of Q1 2015. However, with the sheer number of new screens and brands operating, it is clear this is now a core focus for exhibitors who are looking to strategically invest in the next generation of cinema exhibition with a view to retaining audiences but also to remain relevant amid parallel improvements in the home-entertainment sector such as 4K, UHD and also HDR. This raises a number of strategic questions regarding the opportunity for PLF screens in terms of potential footprint and pattern of incremental revenue growth, as well as the impact this niche now has on the viability of non-premium cinema in general.
The cost of a PLF screen in a new-build venue (around $125,000) equates to a cost saving of at least three times compared to a retrofit in an existing venue ($500,000 to $660,000). Therefore, the ongoing process of opening new screens in demand areas and closing underperforming venues has a strong influence on prospective PLF growth.
One of the primary attributes of PLF is a larger screen, typically over 15 meters, although Dolby has stipulated that screen size is not a factor. Early anecdotal evidence suggests around three to five percent of global screens fall into this larger category of 15 meters-plus, which would give a total addressable market of 7,000 screens out of a global total screen footprint of 141,457 at year-end 2014. This is in addition to net screen growth factoring in a greater cost advantage to installing PLF screens in a new build.
In general, cinema is moving towards an array of premium tiers and experiences based on a superior technology proposition, in combination with service, marketing and branding elements as well as improving the overall customer experience. Nonetheless, the superior attributes of PLF screens and the accompanying technology upgrades are increasingly seen by exhibitors as a primary driver of revenues. Investment in next-generation technology and experiences is seen as pivotal in regards to remaining both competitive and relevant in the wider entertainment mix.
The total digital premium large format (PLF) cinema market reached a total of 1,623 screens worldwide at the end of 2014, an increase of 15.8% from 1,401 just six months earlier. This total includes both the increasing array of exhibitor-developed and branded PLF screens plus a now-growing proliferation of global technology brands, led by the long-established large-format brand IMAX.
Exhibitor-branded PLF was one of the fastest-growing segments, rising 22.3% to finish 2014 at 926, up from 757 screens as of mid-2014. Of the 169 net new exhibitor PLF screens worldwide, the largest net gain can be attributed to Asia-Pacific (78 screens) and Western Europe (3
, which actually recorded more net additions than North America (31), albeit from a lower base.In Western Europe, exhibitor PLF screens more than doubled by the end of 2014, driven by new screen openings in the major Euro territories. The U.K. was one of the fastest-growing markets, with PLF screens doubling over the six-month period from 11 to 22, as all major exhibitors increased their provision of PLF screens, led by Vue Entertainment with 12 VueXtreme screens. The U.K. is now one of only three markets (alongside Australia and North America) where all top five circuits have their own PLF offer. Pan-European operator Kinepolis also confirmed its reputation as an innovator, launching Laser Ultra, the first exclusively laser-based PLF brand by a circuit, combining laser projection from Barco and Dolby Atmos immersive sound.
In contrast, Central and Eastern Europe remains the most underpenetrated region for exhibitor PLF. Global brand PLFs including IMAX as well as RealD’s LUXE umbrella brand account for the vast majority of PLF screens.
North America, the largest market for exhibitor PLF screens, finished 2014 with 408 screens. Although growth has steadied, activity is still dominated by the major circuits including Regal Entertainment’s RPX brand and Cinemark’s XD screens.
China remains the second-largest market for PLF screens globally, with a combined 124 screens derived from three PLF brands: China Film Giant Screen (CFGS, originally known as DMax, with 73 screens), Poly Film’s Polymax (14 screens) and Wanda X Land (37 screens) with data up to the end of 2014. The market there is growing rapidly, up from 82 screens as of H1 2014. CFGS operates as a local Chinese PLF brand with installations across multiple circuits, but has yet to classify as a truly international PLF brand.
There are now a total of 81 individual circuits worldwide (not including multiple brands under cross-territory ownership) with active PLF screens, up from 72 just six months prior.
Global technology brands proliferate
Competition in the globally branded PLF sector has intensified following the launch of Dolby Cinema in late 2014, a new premium concept that combines Dolby proprietary technologies (and a deal with Christie for laser-illuminated projectors) for image quality (with HDR), immersive sound and intrinsic design features. Barco Escape is also a new contender in this space, based on a novel panoramic screen format (similar to CJ CGV’s Screen X) that requires specially prepared content for the three-screen configuration (one large screen at the front and two panels at the sides). This fits into the wider PLF category based on its superior technology attributes, an associated upcharge and experiential nature of the screen.
CJ CGV also launched an industry-wide proposition for its Screen X technology, initially focusing on China and the U.S. (where it also has screens). There were 75 screens in 44 sites with Screen X installed in Korea at the end of 2014. RealD Luxe, established in 2013 as a global umbrella brand for the PLF experience, had a total of six screens across Russia and Bulgaria, plus a number scheduled to open in China later in 2015, for a total of around 30 screens under contract.
Although successful PLF includes a mix of technology, marketing and service, the technology element is a key battleground in this space, with both IMAX and Dolby launching laser-based projection systems (in conjunction with Barco and Christie, respectively).Dolby will therefore be the first exclusively laser-based platform, resetting the bar for the PLF sector in general.
Together, the non-IMAX and non-exhibitor global PLF screens accounted for just 2.6% of screens in the wider global PLF category, but this share is likely to increase significantly following the signing of a major 100-screen (over ten years) deal between Dolby and AMC Entertainment in the USA. The new screens will be branded Dolby Cinema at AMC Prime, setting up a new era of collaboration in branding and design features.
The maximum number of parallel PLF brands operating in a single site has traditionally been two (exhibitor PLF brand and IMAX), although with scope to potentially broaden this with multiple configurations of brands throughout a circuit as the sector’s segmentation grows. For example, Cinemark has Barco Escape screens either in combination with IMAX or its own private-label XD screen, but not all three side-by-side.
Globally, PLF screens accounted for just 2.3% of the total allocation of digital 3D screens worldwide (67,226) as of Q1 2015. However, with the sheer number of new screens and brands operating, it is clear this is now a core focus for exhibitors who are looking to strategically invest in the next generation of cinema exhibition with a view to retaining audiences but also to remain relevant amid parallel improvements in the home-entertainment sector such as 4K, UHD and also HDR. This raises a number of strategic questions regarding the opportunity for PLF screens in terms of potential footprint and pattern of incremental revenue growth, as well as the impact this niche now has on the viability of non-premium cinema in general.
The cost of a PLF screen in a new-build venue (around $125,000) equates to a cost saving of at least three times compared to a retrofit in an existing venue ($500,000 to $660,000). Therefore, the ongoing process of opening new screens in demand areas and closing underperforming venues has a strong influence on prospective PLF growth.
One of the primary attributes of PLF is a larger screen, typically over 15 meters, although Dolby has stipulated that screen size is not a factor. Early anecdotal evidence suggests around three to five percent of global screens fall into this larger category of 15 meters-plus, which would give a total addressable market of 7,000 screens out of a global total screen footprint of 141,457 at year-end 2014. This is in addition to net screen growth factoring in a greater cost advantage to installing PLF screens in a new build.
In general, cinema is moving towards an array of premium tiers and experiences based on a superior technology proposition, in combination with service, marketing and branding elements as well as improving the overall customer experience. Nonetheless, the superior attributes of PLF screens and the accompanying technology upgrades are increasingly seen by exhibitors as a primary driver of revenues. Investment in next-generation technology and experiences is seen as pivotal in regards to remaining both competitive and relevant in the wider entertainment mix.
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