Imax signs deal with Kodak to brighten the picture for its biggest screens
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Imax Corp. is bringing the digital revolution to its largest screens, thanks to a new deal with Eastman Kodak.
The big-screen entertainment and technology company, based in Mississauga, Canada, announced Sunday that has licensed from Kodak exclusive rights to more than 50 technology patents for a laser technology projection system.
The system will make high quality digital content available, for the first time, to Imax screens larger than 80 feet like the one at Universal CityWalk, and to dome theaters located at museums. Until now, about 170 giant Imax theaters have been limited to screening movies in the traditional analog-film format.
Imax said the technology, which it expects to install by late 2013, will increase the brightness and clarity of screens 80 to 100 feet wide and will allow the company to distribute content in its network with greater efficiency because digital prints are much cheaper to deliver than film reels are. About two-thirds of Imax’s 575 theaters, which mostly range from 50 to 70 feet wide, have already been converted to a digital format.
Terms of the royalty agreement with Kodak were not disclosed.
Imax Chief Executive Richard Gelfond described the new Kodak technology as ‘truly cutting edge’ and said that company may eventually roll out the technology to all of its theaters. ‘This 10-year agreement should give us a big advantage in terms of staying at the top end of quality,’’ Gelfond said in an interview.
Although traditionally a film-based company, Imax in 2008 developed a digital system that eliminated hefty film print costs. The system can convert a traditional film into a digital format at a cost of $1.5 million to $2 million. Studios, which distribute the films, hand over about 12.5% ticket sales from an Imax release.
It’s not clear how investors will respond to the Kodak deal. Imax shares have fallen 45% in the last six months, following weaker returns from 3-D films like ‘Mars Needs Moms’ and ‘Pirates of the Caribbean: On Stranger Tides.’ The company’s net income for the quarter ended June 30 fell 87% to $1.8 million from a year earlier, while its revenue of $57.2 million was up 3%.
Still, Imax has been expanding rapidly in countries such as Brazil, Spain, Russia and China. In March, the company announced a deal with Wanda Cinema Line, the largest theater operator in China, to open 75 theaters in China over the next three years.
in March. Credit: Stefen Chow / Bloomberg