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TOPIC: Carmike to install 2,300 DLP Projectors

Carmike to install 2,300 DLP Projectors 19 Dec 2005 11:18 #11673

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http://finance.myway.com/jsp/nw/nwdt_ge.jsp?news_id=cmt-353p9415&feed=cmt&date=20051219

MORRISTOWN, N.J. and COLUMBUS, Ga., Dec 19, 2005 /PRNewswire-FirstCall via COMTEX/ -- Access Integrated Technologies, Inc. ("AccessIT") (AIX) and Carmike Cinemas, Inc. ("Carmike") (CKEC) jointly announced today that Carmike, the third largest national movie theatre circuit, has executed a contract with AccessIT's Christie/AIX subsidiary, for the installation of up to 2,300 Digital Cinema projection systems throughout the United States. With this agreement, Carmike and Christie/AIX will begin installing 2K DCI-compliant DLP Cinema(R) projectors. The rollout is scheduled to begin in January, 2006 and to be completed by October 31, 2007.

"We are proud to have the opportunity to work with Carmike, not only one of the nation's largest theatre chains, but also one of the most forward-looking," commented Bud Mayo, President and Chief Executive Officer of AccessIT. "It would be hard to exaggerate the significance of today's development as a major milestone for the industry and for our respective companies, and we are privileged to be a partner in this important undertaking. Working together, Carmike, Christie and AccessIT are committed to elevating the movie going experience and to bringing the many benefits of digital to audiences in the months ahead."

Michael W. Patrick, Chairman of the Board, President and CEO of Carmike Cinemas, Inc. added, "We are eagerly looking forward to launching this rollout with Christie/AIX. Digital Cinema is the future of exhibition, combining eye-popping image quality that will dazzle moviegoers with unmatched programming flexibility. This flexibility will enable our company to capitalize on new programming options such as 3-D, live sporting events, and other alternative content while continuing to present traditional movies with the best picture and sound possible for even the longest of runs."

"The contract with Carmike is truly a tipping point for Digital Cinema. As a progressive company with clear vision, Carmike has identified Digital Cinema as the next growth and revenue opportunity for their business. We are very pleased that they have chosen DLP Cinema(R) from Christie, a proven technology, to bring the digital experience to the heartland of America," stated Jack Kline, President and COO, Christie USA. "The collaborative efforts of DCI, the studios and the exhibition community confirm that Digital Cinema is no longer just a dream -- it's real, and it's here to stay."

AccessIT's Christie/AIX unit serves as the funding vehicle and administrator for the company's 4,000-screen digital cinema rollout plan expanded significantly from the total originally announced in June 2005. Christie/AIX will act as the financing intermediary between content-owners -- major studios and independent distributors, among others -- and exhibitors who will receive turnkey, DCI-compliant Digital Cinema systems including 2K projectors and related hardware and software. Bear, Stearns & Co. acts as the financial advisor to AccessIT.

A series of key developments preceded today's announcement; notably, formal contracts with The Walt Disney Company, Twentieth Century Fox, Universal Pictures, Sony Pictures Entertainment and most recently DreamWorks SKG. Initial deployments in the plan began in late October in theatres in Detroit, Michigan, owned by Emagine Entertainment, Inc. and at multiple locations in San Diego and Riverside County (CA) multiplexes owned by Ultrastar Theaters, Inc. Completion on these first 150 systems is anticipated before the close of the year.

In a related development, to provide equity funding for this large-scale deployment, AccessIT intends to move forward with the filing of a common stock shelf registration in the very near future.

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Re: Carmike to install 2,300 DLP Projectors 19 Dec 2005 16:33 #11674

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Moat importantly....... "This flexibility will enable our company to capitalize on new programming options such as 3-D, live sporting events, and other alternative content"

What if we could be the outlet for live concerts, etc? That makes more sense than movies distribing.



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Re: Carmike to install 2,300 DLP Projectors 19 Dec 2005 21:04 #11675

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Something other than just movies. Alternative content is probably where we are all headed. As a way of selling tickets to the seats in our auditoriums. Sure we will still play some movies. Especially the event movies that the public want to see on the big screen. And as hollywood moves to a more direct to the consumer way of distributing their lesser product. Like a lot of the stuff that came out in 2005. That just did not sell in theatres.
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Re: Carmike to install 2,300 DLP Projectors 20 Dec 2005 01:43 #11676

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I've heard this "alternative content" angle even before Regal started filling their booths with digital projectors. Yes, "alternative content" was just one of the many projected benefits we'd all derive from the installation of this new state-of-the-art equipment. Oh... there would be a little extra advertising before the show, but that's nothing compared to the potential benefits to your community of "alternative content".

So.... how many shows do you think Parmount, Fox, Universal and the others have graciously allowed the digital exhibitors to pre-empt, so they could put on the latest Tyson fight, or "Monday night football"???? How much extra money has flowed into the theatre coffers, thereby ensuring a healthy economy amongst all exhibitors???


I don't think they've even tried it more than once or twice over here, and we have something like 24 equipped screens in our county.

Seems the "alternative content" gimmick has been around forever, but has never really made much of a difference that I know of. Didn't RCA or Westinghouse have a big screen TV projector that was supposed to revolutionize the theatrical industry?
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Re: Carmike to install 2,300 DLP Projectors 20 Dec 2005 05:49 #11677

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Yeah, BOTH did, as I recall back in about 1949... The concept lasted about as long as a snowball in Hades... That "alternative programming" is just another Big TV, and will make us just about as much money as the "small" ones have!...
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Re: Carmike to install 2,300 DLP Projectors 20 Dec 2005 10:40 #11678

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The news release to hte L.A. Times:

Carmike Theaters to Convert to Digital

A $150-million deal would make the chain the first to transfer to the new technology.
By Julie Tamaki, Times Staff Writer
In a big boost for digital cinema, the nation's third-largest theater chain has agreed to install thousands of systems over the next two years.

Carmike Cinemas Inc. would become the first theater chain to undertake the mass conversion to digital, putting 2,300 digital projection systems in its auditoriums by October 2007. Carmike has theaters in 37 states but none in California
The deal, valued at more than $150 million, involves software company Access Integrated Technologies Inc., or AccessIT, and projector maker Christie Digital Systems Inc.

There are only about 100 screens with digital projection equipment today. The technology promises crisper pictures and sound as well as dramatically lower distribution costs. Studios are working with digital-system makers to help finance the roll-out, which could potentially cost billions of dollars.

While the Carmike deal covers fewer than 10% of the nation's 36,000 movie screens, it represents by far the largest commitment by a theater owner.

Industry analysts said Monday that the agreement established Cypress-based Christie and Morristown, N.J.-based AccessIT as the dominant suppliers of digital cinema systems.

"Most of the [deals] have been bits and pieces," said industry analyst Dennis McAlpine. "I think this is the one that says, 'OK, everyone is going to have some digital.' "

Movie studios in recent months have signed deals with Christie and AccessIT or with Technicolor Inc. to help offset the cost of installing digital cinema systems. The studios help finance the technology and hope to recoup the expenditure through lower distribution costs.

"I think it does complete the other side of the picture," said Bill Mead, publisher of DCinemaToday.com, a website that tracks digital exhibition.

Universal Pictures distribution President Nikki Rocco said: "It's great to see exhibition is jumping on the band wagon" and looking at digital cinema "as if it is imminent."

Last week, a trio of movie theater chains — AMC Entertainment Inc., Cinemark USA Inc. and Regal Entertainment Group — signaled ambitions to deploy digital cinema systems. The chains have agreed to use a joint venture, National CineMedia, to develop a business plan to reduce the cost of purchasing equipment for their combined 13,000 screens and establish a financing model.

AccessIT and Christie plan to install digital systems on at least 4,000 screens over two years, with a goal of expanding the plan to 10,000 screens. The first 150 systems are being installed at multiplexes owned by Ultrastar Theaters Inc. in San Diego and Riverside counties as well as theaters owned by Emagine Entertainment Inc. in Detroit.

The Carmike deal calls for digital cinema systems in nearly all of the Columbus, Ga.-based company's about 2,500 screens. In exchange, Carmike will pay service fees to Christie and AccessIT to manage the systems over the next decade.

Christie President Jack Kline declined to specify the fees, but suggested that they were in line with fees charged to maintain existing 35-millimeter systems.

Carmike executives said they expected digital cinema to help them take advantage of 3-D programming and live sporting events as well as bolster the number of movies screened by eliminating bulky and expensive 35-millimeter film.

"Small town America doesn't play about half the movies the studios release each year because the cost of the print itself excludes us from making a profitable deal," Carmike President Michael Patrick said. "We also think the public will have a tremendous amount of curiosity in seeing and hearing what digital gives you.

"When we are unshackled from 35-millimeter prints, it will allow us to play one movie in more auditoriums," Patrick added.

Tony Rhead, entertainment vice president at Carmike, said his company also spoke to Technicolor but chose to go with the Christie coalition because Technicolor appeared to be "months behind Christie…. In my opinion it will probably be six to nine months before they are ready."

A Technicolor executive said his company planned to start deploying a couple of hundred digital cinema systems in three to four months as a test to ensure the equipment works properly.

"There can be no risk to the box office in this transition of technology," said Joe Berchtold, a Technicolor president.
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Re: Carmike to install 2,300 DLP Projectors 20 Dec 2005 10:43 #11679

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And the Washington Posts take on it:

Carmike Cinemas plans massive digital rollout
By Bob TourtellotteReuters
Monday, December 19, 2005; 3:28 PM

LOS ANGELES (Reuters) - Carmike Cinemas Inc. <CKEC.O>, the No. 3 U.S. movie theater chain, on Monday said it will install new digital projection systems from Christie/AIX at all of its nearly 2,300 screens over the next two years.

The deal, estimated to be worth nearly $300 million, marks the first major theater chain to commit to a wide-scale digital deployment, and it could serve as a harbinger for more agreements to come, Christie/AIX officials said
Shares of New Jersey-based Access Integrated Technologies Inc. <AIX.A>, or AccessIT, gained 14.35 percent, or $1.38, to reach $11.00 by mid-afternoon on the American Stock Exchange.

Carmike shares were off 1 percent, or 26 cents, at $25.49 on Nasdaq.
AccessIT and privately-held projector maker, Christie, are partners in the venture, Christie/AIX.

"When the third largest circuit says, 'This is time,' that clearly sends a signal to the industry that, not only is the technology ready, the business plan is ready and it's good for the exhibitor," said Jack Kline, president of Christie USA.

Digital cinema systems, which can cost up to $100,000 per screen, essentially replace old-style, celluloid projectors with new computer networks and projection equipment.
Audiences get a sharp picture every time they see a movie. Theaters can program new types of content to boost box offices, and movie studios save millions by not shipping thousands of film canisters around the world. Instead, they send a digital file via a satellite or high-speed cable network.

Michael Patrick, chief executive of Georgia-based Carmike, said digital technology will put major Hollywood films in small town theaters faster than is now possible with celluloid film.

Carmike also expects to book music concerts and corporate or religious meetings in its theaters at mid-week or during daytime hours when theaters are mostly empty.
Patrick said the financial impact would be seen over time as more theaters come on line.

NEW DIGITAL THEATER

Digital systems are expected to open theaters for new 3-D movies and sporting contests because the satellite links make them a sort of closed-circuit network for live events.

"There's just no end to the number of programmings you can do," said Carmike's Tony Rhead, who is responsible for the company's digital cinema program. "You can do concerts in small towns and reach the people who are not in an Atlanta or New York or Chicago or large town that all the artists come to."

The transition to digital systems stalled in the late 1990s while theaters owners, the movie studios and equipment makers confronted issues on technology and business planning. But many hurdles have been overcome.

Christie/AIX has lined up Universal Pictures, Walt Disney, 20th Century Fox, Sony Pictures and DreamWorks to pay the print fee and make digital movies, and AccessIT chief executive Bud Mayo said other major Hollywood studios are not far behind.
He also said he is working with content providers other than the studios to secure new types of programing.

"We're going to get busy right after the first of the year to work with a variety of sources to put new things on the table," Mayo said. "The record labels are extremely excited about using digital cinema as a way to launch a new CD."

AccessIT said it will soon register with the U.S. Securities and Exchange Commission for a future stock sale to help fund the Carmike installation.
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Re: Carmike to install 2,300 DLP Projectors 20 Dec 2005 13:32 #11680

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"AccessIT said it will soon register with the U.S. Securities and Exchange Commission for a future stock sale to help fund the Carmike installation". It needs a stock sale? If it's such a good idea why not roll out on cash?



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Re: Carmike to install 2,300 DLP Projectors 20 Dec 2005 13:34 #11681

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Looks like they are not getting enough pre installation up front cash from Carmike.


Also seems like Satellite is the way all installations will go. So at least we can start planning where to put these 8 foot dishes. Guaranteed these networks won't broadcast on these little DirecTV DBS size dishes.


[This message has been edited by sevstar (edited December 20, 2005).]
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