Although distribution and exhibition are the end points in the value chain of the film business, they are of utmost importance because "goofing" up at this stage means that the film , however well made, will be a flop at the "Box Office". With post production accounting for 20% of the film budget and taking 20% of the total time, any savings in this would go directly to the bottom line. Digitalization has the potential to bring in the desired savings and drive up profits substantially.

Typically a distributor buys rights for a 'territory' and recovers costs from the exhibition of the film. The distributor buys into the risk with the producer.

Today, before a film is released, no distributor knows the fate of the movie. Copies are made based on a guesstimate and the stakes are high. The copies are sent to various distributors in the country, who in turn rent them out to theatre owners.

If the estimate goes awry, all that the theatre owner, the distributor or the producer can do about it is grin and bear the costs.

The digital world, however, works differently. The problem of physically moving the reels from one place to another does not exist. All it requires is a license to make another copy. And, making copies is as easy as clicking a button. The cost of distribution is significantly lower. The theatre owner will no longer be forced to show a movie that is doing badly. He simply has to switch over to the one that the audience wants to watch.

Further, with overseas becoming a major territory and considerable costs associated with the same any savings in the distribution costs will be a great boon for film producers and distributors alike. Distribution of films around the world has become such a big business that it fetches about as much business as Delhi-Uttar Pradesh, one of the six distribution territories within India.

With tickets in US being priced at $8 and those in UK being priced at 8 pounds the collection from the 10 million population from overseas is same or more than the collection from the 150 million population in of Delhi and Uttar Pradesh .

Other disadvantages of physical distribution are because of the high costs of making excess prints and because of the physical nature (rather than digital nature) of prints people in remote corners of the country deprived of seeing a hit film till the print is available for them. Further, if a movie is a flop then because the film is not simultaneously released (because of the physical nature of prints) all over the country at the same time bad publicity may spread and therefore no one may want to see the movie.

A primer on digital technology in film distribution

Digital cinema or eCinema or eMovies is the latest buzzword that has the potential to profoundly affect the distributors in the industry.

Electronic cinema refers to film-less digital distribution and exhibition system of films using high quality digital projectors that are brighter and have higher resolution versions of video projectors. With this, feature films can be projected in small to medium size theatres with DVD playback equipment .

It is expected that by 2005, movies as bitable digital data files will increasingly replace physical prints as the preferred medium of distribution.

Financial Benefits
Electronic cinema like any disruptive technology has the potential of drawing the studios, production houses and exhibitors alike and gaining considerable marketshare at the expense of traditional film distribution. The benefits to distributors will be in the form of:

Print costs are currently about 15-25% of a film's production cost. A print costs around 80,000 rupees, a set of DVD-ROMS will cost as low as 8000/- A whopping 90% saving. In USA, release prints cost $2,000 each. Further, shipping and insurance add another $1,000 per print to the distribution costs. Thus an average big- budget release chalks up print and distribution costs in excess of $15 million. Imagine the benefit if these costs were slashed by upto 90%.

Digital production will be completed in lesser time and thus speed up the entire process from finish to release as innumerable disks can be made in a day.

The film could be released in more cinema halls simultaneously as the cost for the distributor is relatively high. Thus, no more worries for theatre owners and exhibitors and distributors who have to physically carry the film reels from one theatre to another and time shows accordingly, thus enabling faster recovery of investment. Further , by the time bad publicity of a flop movie spreads it will have recovered a table profit.

Every print is a perfect copy. Thus gone will be the days where the print is really bad if we don't see a movie in the first month. All the quality issues from the right hue to color drift to print degeneration by repeated theatrical telecasts will be a thing of the past with the advent of digital technologies. Film Buffs do not mind paying a few rupees extra if they will receive "Picture Perfect" Movies due to digital technology.

Exhibitor is at greater ease of operation- as all trailers, feature films and advertisements can be pre-programmed. There would be no operator errors and no operator manipulations.

Boost box offices. As has been said by all the gurus in the Internet world, industries where the final product can be digitized will be turned upside down. As the compression technologies develop and prints are digitized, the economies of scale that can be achieved will be significant . Just imagine the day when a movie is digitized at a central location and then transmitted to various theatres in the city at the same time thus avoiding the painful task of making countless prints and moving these prints from one place to another . Anyone who has gone to a Hindi movie in the US would have observed how the print is brought to the theatre just before the show and then taken to the next destination immediately after the show.

With files replacing prints, a single screen can show multiple films and if audiences on a given night do not want to see "The Chick Flick – Charlies's Angels" the theatre owner may switch to "Kasoor". Thus, depending on audience taste, revenues can be kept high .

"Cut and Paste" leading to considerable time and cost savings. Haven't we all seen so many similar scenes in Movies like a sunrise in Mauritius or a view of the Savannahs . With the rise of digital technology, it will be possible to cut and paste any scene from a movie into another file a la Powerpoint and thus avoid expensive shooting overheads and star tantrums. Why it will be accepted

Most of theatres in India have old projectors; hence they can straight away jump from old projectors to state-of-the-art digital technology provided government provides tax benefits and these equipment get the status of infrastructure equipment .

It is not too big an increase in cost for new multiplexes.

DVD ROMS cannot be decoded outside a Digital Cinema playback unit, thus it provides a strong safeguard against piracy- the biggest problem faced by the film industry today.

Every show can have watermarks indicating theatre, time and date. Thus, foolproof reporting of playback data also prevents unauthorised shows. International experience

"Star Wars: Episode 1, The Phantom Menace" is the first major studio film to be shown the E-Way. Sometime in the middle of 1999, a few theatres in New York began screenings of the "Phantom Menace" using digital technology. They used Texas Instruments and CineComm digital projectors for the test screening. This experiment allowed lay audiences to see digital projection systems running real movies, while movie industry experts could compare competing projection systems operating in real theaters. Further proliferation of digital technology happened when Miramax exhibited "An Ideal Husband" in the USA .

Officials at 20th Century Fox Inc. and Cisco Systems Inc have digitally transmitted a Hollywood movie across the country over the Internet and then digitally projected to a cinema audience, going from the studio in Hollywood to a theater in Atlanta without ever touching the film. The idea was to demonstrate the potential of digital distribution, which many believe will one day supplant traditional canisters of celluloid, and to allow Fox to have the world premiere of its new animated feature, "Titan A.E.," at Atlanta's Supercomm trade show .

Using Cisco's latest technology, the movie was hurled from Qwest CyberCenter in Burbank to the Woodruff Arts Center in Atlanta, where it was projected on a Barco/Texas Instruments DLP Cinema digital projector.

Obstacles that will have to be overcome to ready digital technology for the masses

Projector costs will have to drop quickly. While digital projector prototypes cost $250,000 today, mass production will reduce the price to between $100,000 and $150,000 by 2001.

As of now capturing "Live Action" digitally is prohibitively expensive and while special effects are now created digitally, live action is not. This will change as digital content dominates feature films. More films like "Raju Chacha" where digital technology is used will be created as costs fall.

Dramatic reduction in distribution costs will cause industry wide encryption standards to become prevalent. CineComm incorporates Qualcomm's patented compression algorithm and encryption scheme into its projection system to guard against piracy. EMovies will be successful only if arguments over cost sharing between exhibitors and distributors are sorted out . Most probably since crores of Rupees will be at stake these differences will be surely sorted out.

Another issue is that many in Hollywood think, that once their films are upon the Internet, they will be pirated like music has been in recent months. As a result, Cisco 7140 Virtual Private Network, a method for isolating and protecting data traveling across the internet, including fire walls, security routers and encryption devices is being developed. Conclusion

E-cinema envelops the entire process from filming to storage, transmission, distribution and projection of movies, all of which can be done digitally.

The technology demonstrations have already started in India. The next year awaits the HDTV (high definition TV) telecine and mastering facilities.

Shekhar Kapoor's digital studio and Sony Corporation's digital motion picture camera are just the beginning . When e-cinema really takes off in the country, it will spark a revolution in the industry .

As for transmission, the film can travel instantaneously over computer networks in the "frictionless economy". Film distribution, now a complex affair, will take place at the "click" of a mouse.

2006.... Multiple versions of a film exist with different scenes , extra songs , films being edited accurately after release- with remote controls , multiple language sound tracks and even multiple language sub-titles exist at the same time.

It probably only a matter of time till technology drives the change in the film world, making the industry more corporatised, and, therefore, suited to digital cinema.