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news and views on broadcast and professional video/audio sectors, worldwide

w/e September 2, 2007 SCRI International, Inc © 1984 - 2007


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Digital cinema standard?

The number of digital-cinema screens in the U.S. could exceed the number of traditional screens employing film projection within four years.

That is, if a series of deployment plans that are expected to be under way by early 2008 stay on track. A survey by The Hollywood Reporter showed that the proposed plans call for more than 20,000 digital-cinema screen installations in the U.S. and Canada by the end of 2010.

"Once beta markets feel ready, installation will accelerate," said John Fithian, president of the National Association of Theatre Owners. "We believe that will occur in 2008."

Still, there remain a limited number of suppliers as well as standards-and-compliance issues, all of which could be among the factors that could cause delays.

Currently, there are about 3,000 digital screens installed domestically out of a total screen count estimated at about 37,000. Most of those are part of the Christie/AIX program, which aims to deploy 4,000 digital screens. The AccessIT unit already has completed the rollout of about 2,800 screens with such exhibitors as Marquee Cinemas, Neighborhood Cinema Group, Celebration Cinema, Cinema West, Cinetopia, Emagine, UltraStar, Galaxy, Rave, Carmike Cinemas and AccessIT's Pavilion Digital Showcase Cinema. Deployment of the 4,000 screens is expected to be completed by November.

Meanwhile, AccessIT continues to work on new exhibitor deals while beginning discussions with studios toward an additional phase of deployment -- where the target would be 10,000 screens by the end of 2010, according to Chuck Goldwater, president of AccessIT's media services group.

Other efforts are moving forward concurrently. Technicolor Digital Cinema has a beta program under way with about 200 installations, and deployment is expected to begin by early next year. Technicolor's plan calls for the installation of 5,000 screens in North America within three years, said Joe Berchtold, president of theatrical services at Technicolor.

"In 2007, we've seen a real stability of the technology that has been in place," he said. "Therefore I think 2008 is when we'll start to see the real momentum in the industry behind the conversion."

Deployment also is imminent at Digital Cinema Implementation Partners, a joint venture owned by AMC Entertainment, Cinemark USA and Regal Entertainment Group that represents more than 14,000 screens in the U.S. and Canada. Formed in February, DCIP is working on deals with the aim of beginning to transition its screens in early 2008. DCIP chairman Travis Reid expects to complete deployment of digital screens to the three chains in three to four years, depending on technology availability. He estimated that at least 75% of the screens would be digital by the end of 2010.

Also looking at the beginning of next year as a goal to begin rollout is Cinema Buying Group, which operates as a separate entity under the NATO banner. It has about 4,000 screens committed to go digital, and that number might climb to more than 5,000 in the U.S. and Canada by summer's end. The organization is accepting proposals that would be reviewed in the fall during ShowEast, CBG managing director Wayne Anderson said.

It is possible that some theaters are counted in more than one of the deployment projections, when considering numbers.

Still, these efforts seem to bode well for digital-cinema proponents as well as the 3-D movement. Leading 3-D provider Real D's chairman and CEO Michael Lewis said, "From Real D's perspective, the 2-D rollout will determine the size of the Real D platform (rollout)."

Concluded Fithian: "(Digital cinema) is the biggest technological transition in our industry since the advent of sound, and it is much more complicated. This rollout will take somewhere between five to 10 years."

3-D-ready screens on the rise

According to a recent Reuters report, the Walt Disney Co.'s rerelease of "Tim Burton's The Nightmare Before Christmas" in 3-D digital cinema proved a success, playing in 168 theaters and grossing $8.7 million. It even ran in some venues until New Year's Day.

The 3-D-ready screens then will be needed to accommodate the debut of Paramount Pictures' 3-D "Beowulf" on Nov. 16, says Chuck Viane, president of distribution at Disney. "I would say within 12-18 months the marketplace will take care of itself," he says. "While the initial (3-D) installations are going on, you have to be quite cognizant of what is available to you in 3-D."

This shift could mark the arrival of a new stage in the 3-D digital-cinema movement.

Big titles are driving installations. Paramount estimates there will be 1,000 3-D-ready screens for "Beowulf," but that figure is skewed as it counts film-based Imax screens as well as digital installations from Real D and Dolby Digital Cinema. For digital 3-D releases, 3-D provider Real D is more optimistic, saying that it expects to exceed 1,000 screens in the fall. Dolby, which announced a 3-D digital-cinema system in March at ShoWest, is testing its technology in theaters and plans to roll out in time for "Nightmare" and "Beowulf." The company did not yet have screen-count figures.

Says John Fithian, president of the National Association of Theatre Owners: "We are very bullish on 3-D and digital cinema. But filmmakers and distributors have to be realistic about the pace of integration when scheduling their movies for release."

This topic caught some attention recently when DreamWorks Animation's 3-D "Monsters vs. Aliens" was scheduled to open May 15, 2009 -- one week shy of Fox's James Cameron-helmed 3-D feature "Avatar." But this is not the only example as 2009 might see about 10 major 3-D digital releases.

"I think the biggest challenge is how quickly (2-D) digital cinema is going to roll out, that appears to be on a good track right now," Real D president Joshua Greer says. "As we get closer, I believe release patterns will work themselves out."

Adds Paramount president of distribution Jim Tharp: "So far (screen count) has not impacted our release date decisions. It would be a huge concern if there were movies coming out (in the same time frame) this year -- then it would not be adequate."

In the fall, National Geographic's "Seamonsters 3D" and "Lions 3D" are actually expected to open, but according to Real D, these would run during the day. Real D predicts there will be five or six 3-D openings in 2008, including "U2 3D" and "Journey to the Center of the Earth."

Predicts Viane: "2009 has more than its share of announced 3-D titles. Then you will see the digital revolution take over. Instead of everybody having one 3-D screen in a building, you will start to see theaters put in two, possibly even three, auditoriums that are 3-D capable. They will be able to hold over successful 3-D while still opening new 3-D. When you hear people like Robert Rodriguez talking about 3-D, they are not pipe dreams; their films are going to be made. (Exhibitors) are going to want to accommodate that product. They aren't going to want to give up those products early."

HDTV Format War

This report is by Phillip Swan, publisher of SCRI's onlne partner TV Predictions.

I have predicted that Blu-ray will ultimately win the high-def disc format war against HD DVD. However, at, we are committed to providing all the news and views that come from the battle between the two forces. We have no favorites here; we just want to present the information.

For instance, earlier this month, we featured three videos from Microsoft's Kevin Collins on why his company believes that HD DVD is better than Blu-ray. After the videos were posted, I received several e-mails from Blu-ray supporters saying that we were biased in favor of HD DVD. After one Kevin Collins video remained on our Home Page for two weeks, I received some more e-mails suggesting a HD DVD tilt.

This week, I posted my own video outlining three steps that Blu-ray supporters might take to seal the deal in early 2008. After that post, guess what? I received several e-mails from HD DVD supporters saying I was biased in favor of Blu-ray. Of course, the e-mailers weren't aware that last June after Blockbuster announced it was only offering Blu-ray in 1,450 stores -- and many analysts then said HD DVD was a goner -- I posted a video offering three steps that HD DVD supporters could take to continue to compete.

By now, I'm sure you see a trend here. The HDTV DVD format war is so bitter, so intense that any view is immediately dissected and accused of bias from those who don't benefit from that view. There's a similar development in the cable vs. satellite war over issues such as high-def picture quality. When we publish an article quoting someone saying that one is better than the other, we are immediately hit with bias charges.

But here's the scoop, folks. There is no bias here. We have no vested interest in seeing either Blu-ray or HD DVD win. (In fact, a cynical journalist might argue that we benefit from the war continuing because it provides so many good stories.) But we will post a variety of news and views that, from time and time, might make one format look better than the other.

That's the nature of news -- even if it doesn't make all people happy all the time.

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Global sales continue to rise but rate is slowing

Latest figures from the IABM Industry Index indicate that global sales have continued to increase by a healthy 10.7% year on year, but the monthly trend shows that the rate of increase is falling.

Sales by North American companies have increased more than for European companies.

The increase is greatest for large companies with small companies seeing no share of the market growth.

Although 74% of companies are in profit in the latest results, this leaves a significant 26% who are loss making, a percentage almost unchanged on a year earlier. A higher percentage of companies are profitable in Europe than in North America. Profitability is still increasing much faster (28% year on year) than market growth, so aggregate performance is improving.

The global Index for profit to sales ratio remains constant at 11.7%. Again this reflects good returns from the large companies; smaller companies have aggregate negative returns. The return for European companies is much higher than that achieved by North American companies.

MTV and Apple in UK Distribution Deal

MTV Networks International and Apple(R) announced an agreement to distribute full-length hit TV shows from MTV, Nickelodeon, and Paramount Comedy channels for purchase and download from the iTunes(R) Store in the UK.

The UK agreement is the first between the two companies outside the USA. It builds on the strength of their existing US partnership and is expected to be the first step in a broad international partnership.

"We're very excited to be partnering with iTunes," said David Lynn, Executive Vice President and Managing Director, MTV Networks UK and Ireland. "Brands like MTV, Nickelodeon and Paramount Comedy create some of the most popular music and entertainment shows on television today -- from Pimp My Ride and SpongeBob SquarePants to South Park. Making our content available on the iTunes UK store gives our audiences the ability to watch our hit programming whenever they want and wherever they are."

Mika Salmi, President of MTVN Global Digital Media, said that the international roll-out of content on iTunes was a key part of the company's plans to see its programming available across all digital platforms.

"This is an important step forward. We already have programming and content on 35 mobile TV stations, 284 online properties and 141 TV channels," said Salmi. "iTunes is a natural progression for us in the global roll-out of content on digital platforms from all our brands, increasing customer choice and boosting international and digital revenues."

NewBay Media Forms New Video / Broadcast Group

NewBay Media LLC announced the formation of its new Video/Broadcast Group, combining the strengths of the video industry's leading publications and website, Videography, DV and Creative Planet, with the broadcast industry's leading titles, TV Technology and Radio World.

"Today we are announcing the formation of a new leader in the Video and Broadcast vertical markets," said Steve Palm, NewBay's CEO. "NewBay has unparallel depth, breadth and credibility in these growing markets. The integration of IMAS Publishing into NewBay is well ahead of schedule thanks to the focus and hard work of a very talented team of professionals."

The group is headed by Executive Vice President Carmel King, former CEO of IMAS Publishing. Joining her on the management team is Eric Trabb, VP/Sales and Group Publisher of the TV and Video titles including DV, Videography, Digital Cinematography, Government Video (GV), Television Broadcast (TVB) and TV Technology (all editions). John Casey, publisher of Radio World, and Raffaella Calabrese, publisher of Radio World International, under IMAS continue those roles with NewBay. Calabrese also serves as Director of NewBay Media Italy Srl, publisher of Broadcast & Production Italy.

Editorial Director duties for the group will be shared between Cristina Clapp (video titles and Creative Planet) and Carter Ross (broadcast titles including TVB and Government Video (GV)).

In addition to the print and online properties NewBay also produces industry leading trade shows; DV and GV Expo. These events continue under the direction of Events Director, Linda Cohen.

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Akamai Brings HD to the Internet

Akamai Technologies announced that a consistent, high-definition video experience is now possible online via its global content distribution network. Akamai’s customers are now delivering HD quality content on Akamai’s uniquely distributed edge delivery network that is specifically tuned for optimal delivery of HD files online.

“As broadband connectivity becomes more ubiquitous, users are demanding – and frankly should expect – a high-quality, high-definition video experience on the Internet,” said Mike Afergan, chief technology officer, Akamai. “Delivering premium HD content is a critical way for our customers to attract and delight their audiences in today’s highly competitive media environment. We are just at the beginning of a very exciting market opportunity for delivering premium HD content. Consumer demand exists, broadband is ready, and businesses are looking for ways to maximize the value of their high-production HD content.”

HDTV is defined by the industry to be video with significantly high pixel resolution of 1080i, 1080p or 720p. In the broadcast world, the industry is undergoing a series of transformations that are standardizing the delivery of high-definition video to the home. For the Internet, Akamai is making the HD web possible by continuing to refine the infrastructure required to bring the HDTV experience to online audiences. Additionally, Akamai will continue to lead this effort with new service launches, device integration, and partnerships with technology vendors, expected in the coming months.

“As broadband video viewership has escalated, consumers have raised the stakes by demanding better and better content experiences,” said Will Richmond, president and founder of Broadband Directions LLC, a market intelligence and consulting firm specializing in broadband-delivered video. “To deliver against these requirements, media and entertainment companies need to offer higher bit rate files with enhanced online fidelity of video and audio files. Doing so in a scalable and cost-effective manner requires that the necessary infrastructure to support high definition content must be deployed.”

“The capacity to deliver high throughput files already exists at the ‘edge’ – leveraging the massive build-outs occurring in hundreds of individual networks. The challenge comes from how you tap into that capacity. The only way to solve this problem is to deliver from within these networks,” continued Akamai’s Afergan. “For example, on our distributed platform, we serve more than half of all the files, 500 MB or greater, at more than 1.4 Mbps, and this is only increasing. This demonstrates that, by leveraging the right architecture, there are already a large number of end-users capable of downloading higher quality content. This technical capability coupled with the market demand is exciting for the industry.”

Ascent Media Group and HP Form Alliance

Ascent Media Group and HP announced a strategic alliance to co-develop, market and deliver enterprise-level services and technologies that enable studios, content providers and aggregators to archive, repurpose and distribute media digitally for the multi-channel market.

The announcement formalizes the companies' three-year collaboration through which they have successfully enabled customers, such as Sony Pictures Entertainment and Paramount Pictures, to meet growing consumer demand for entertainment content on broadband, mobile, and other digital outlets and devices.

Through this alliance, the companies intend to transform the media supply chain by providing a hybrid solution to address both digital and physical media requirements. It marks the first formal pairing of a leader in transaction processing and IT with a leader in media operations.

"The media industry is in the middle of a massive shift from physical to virtual processes, and a transformational solution is needed that addresses both," said Jose Royo, chief technology officer, Ascent Media Group. "When you combine HP's leadership and expertise in large-scale transactions with Ascent's deep knowledge of media workflows, the result is an extensible platform that enables media companies to scale their businesses for the digital realm cost-effectively."

Microsoft: We Didn't Pay Paramount for HD DVD

Kevin Collins, who runs Microsoft's HD DVD unit, is denying that his company paid Paramount to exclusively back HD DVD in the high-def format war against Blu-ray, according to Phillip Swan at TV Predictions, SCRI's online partner.

Paramount and DreamWorks last week stunned the High-Definition industry by announcing that they will back HD DVD exclusively. Paramount had previously released films in both formats while DreamWorks had yet to pick a winner in the battle.

The news led Blu-ray supporters to quickly charge that the studios had been paid off by Microsoft and Toshiba, the leading companies behind HD DVD.

The New York Times last week quoted an industry official as saying the studios received $150 million combined to back HD DVD, although the newspaper did not say who paid the studios.

But in a post at the Home Theater Forum message board, Collins said he was interrupting his vacation to "go on the record stating that Microsoft did not provide any financial incentives to Paramount/Dreamworks' recent decision to support HD DVD."

Referring to articles saying Microsoft had paid the studios, Collins continued: "This type of 'reporting' amazes me and I challenge anyone to provide proof around these statements. They are unfounded and inaccurate."

However, Collins appeared to indirectly confirm that Toshiba paid the studios. The Microsoft executive says an article by the web site Ain' accurately described why Paramount is supporting HD DVD.

The Ain'tItCool article notes that Paramount received an "advertising incentive" from Toshiba to make the switch, although it adds that the decision was based on other factors such as manufacturing costs and technological advantages.

Collins also seems to dismiss rumors that Microsoft is offering financial incentives to Warner Bros. to back HD DVD exclusively. The studio now releases titles in both formats.

"I hope this clears up the misinformation that has been reported regarding Microsoft’s involvement in the Paramount/Dreamworks decision or in the 'rumored' involvement with Warner," he writes in the post.

Optibase Completes Partial Cash Tender Offer for Scopus

Optibase Ltd. announced that it has successfully completed its tender offer to purchase approximately 5% of the outstanding ordinary shares of Scopus Video Networks Ltd. for $5.75 per share in cash, less any required withholding taxes and without interest.

Optibase has been advised by the depositary for the tender offer that, as of the final expiration of the tender offer, a total of 6,091,470 Scopus shares had been validly tendered and not properly withdrawn pursuant to the offer. As contemplated in the offer to purchase, as amended, Optibase has accepted for purchase 690,000 of such tendered shares on pro rata basis from all tendering shareholders, based on a proration factor of 11.32732%.

Payment for the shares accepted will be made through Computershare Trust Company, N.A., the depositary for the tender offer.

After payment for the shares tendered in the offer and accepted for payment, Optibase will beneficially own 3,725,223 ordinary shares of Scopus, representing approximately 27.3% of the issued and outstanding ordinary shares of Scopus.

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Flat Screen HDTV to Replace Projection

Flat-screen LCD and Plasma High-Definition TV sales are booming, but a new study says they will virtually take over the entire TV market by 2011, according to an article by

The web site says IDC Group, the research firm, estimates that sales of DLP and LCoS rear projection sets will fall to under 30,000 units by 2011. The Consumer Electronics Association reported that 3.5 million rear projection sets were sold in 2004.

The reason for the decline: Shrinking prices on the flat-screen TV which has become a status symbol in many homes, in the United States and elsewhere.

The shift from the rear projection set to the flat-screen has been chronicled by other research groups. DisplaySearch reported this month that flat TV sales accounted for 75 percent of all total TV shipments in Japan, Western Europe and North America in the second quarter of this year.

However, if IDC is correct, falling sales of rear projection sets could lead to lower prices on existing models in the near future.

Fujitsu Introduces New H.264 Transcoder

Fujitsu Microelectronics America extended its family of high-performance H.264-compliant ICs, announcing a new transcoder designed to compress full high definition (1920 x 1080) MPEG-2 video data to H.264 data for high-volume consumer applications.

The new Fujitsu MB86H52 can compress MPEG-2 video data to less than half its original size, enabling transmission of full HD video over narrow bandwidths while maintaining high video quality. The combination of capabilities makes the MB86H52 ideal for high-volume consumer products, including hard disk recorders (where recording time can be lengthened by more than 2.5 times), video recorders (PVRs) and set-top boxes (where the compression technologies reduce video data sizes significantly, creating longer recording times).

"The MB86H52 delivers an H.264 compression ratio that is 2.5 times the ratio of MPEG-2, providing customers with significant savings in total hard disk space," said Davy Yoshida, director of business development, Fujitsu Microelectronics America. "For bandwidth-limited applications that require transmission of high-definition video streams, the benefits of compressing from MPEG-2 to H.264 are compelling. The new MB86H52 transcoder is ideal for these applications."

The new MB86H52 transcoder will be available in September. It is packaged in a 496-pin PBGA, and sample pricing will start at $250 each.

Sony relies on HD

Sony unveiled 15 new flat TVs and a new remote control for the domestic market on as a part of a world-wide effort to win back market share during the year-end shopping season. The world's second-largest maker of liquid LCD TVs, is struggling to catch up to South Korea's Samsung. Sony hopes its new 40-inch to 70-inch high definition TVs and a new remote that does not have to be pointed at the TV will help its Bravia-brand LCD TVs turn a profit this year, from a $176 million loss in April-June

Dalsa to Host 4K Screening at IBC

Dalsa's upcoming plans for the IBC show in Amsterdam include the presentation of a 4K screening of The Trident, a short film directed by Anurag Mehta and shot by cinematographer David Stump, ASC, using the company's Origin 4K camera.

Attendees will have a chance to speak with Stump at the presentation regarding his experience using the Origin 4K. After the presentation, Dalsa will screen additional footage captured using the Origin 4K camera. The company will then open things up to a Q&A.

The Trident screening will take place on Saturday, September 8th at 11:00am in the IBC Auditorium.

Sony Unveils PC/HDTV Computer

Sony today introduced a Vaio computer that includes a Blu-ray player and it can operate as a High-Definition TV cable receiver.

Priced at $2,900, the Sony Vaio LT19U comes with a CableCard slot so users can insert the card to display their digital cable signals on the 22-inch LCD screen, including high-def channels. (The CableCard can be obtained from the cable operator.)

The computer also has built-in wireless networking, a built-in ATSC and NTSC TV tuner and the Blu-ray feature which includes playback of Blu-ray discs and burning high-def video on discs.

Sony stressed that the computer could be used as a PC and a television.

"The LT model has everything you need- it's a PC and HDTV set in one breathtaking device," said Mike Abary, Sony's senior vice president of VAIO product marketing. "It's the ultimate showstopper for media lovers who appreciate high-def performance and cutting-edge technology in a saving space design."

Sony also introduced a less expensive model ($1,900) that does not include the Blu-ray support.

The computers will be available at retail in October.

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Graphics Add-in Board Market Rebounds in Q2’07

All parties with a vested interest in the graphics AIB market are breathing a sigh of relief. While Q1’07 proved to be a bust for the market, Jon Peddie Research reports that in Q2’07 the market bounced back with nearly the same vigor it had nose-dived the previous quarter.

JPR places much of the blame for Q1’s particularly poor ASPs on the clearing of inventory as both market leaders AMD and Nvidia were at varying stages of major product transitions. The research firm’s expectation – and industry’s hope – was that Q1 was likely just a temporary adjustment rather than an indication of a longer-term trend.

Fortunately, Q2 results appear to confirm just that. Not only were units up but ASPs experienced a strong recovery after the dismal Q1. In all, Q2’07 saw 21.1 million AIB units shipped, along with about $5.8 billion in revenue (street value). The rebound in revenue represented an increase in sequential growth over the disappointing Q1. But Q2 was more than just a rebound making up for the Q1 drop, as the quarter looked respectable viewed in the year-to-year context as well, with units up 10.6%.

With Q1 now thankfully appearing as an anomaly, JPR sees a healthier short-term outlook on the market. Both Nvidia and AMD have recently released more mainstream-priced product derived from their latest generation GPUs. Nvidia has pushed out the cost-reduced GeForce 8600, 8500 and 8400 series to complement the top-of-the-line GeForce 8800 models. Meanwhile, AMD has the Radeon HD 2600 and 2400 out, offering up its latest R600 generation technology at lower price points as well.

However, the long-term, big-picture trend that will continue to pressure the AIB market is the encroachment of graphics processors integrated in chipsets (IGPs). IGPs have vaulted Intel to the top of the graphics heap, taking a big chunk of the market formerly owned by add-in boards housing discrete graphics processing units (GPUs). And beyond IGPs, the market will also have to deal with pressure from the impending combination of CPU+GPU coming in ’08.

Too much choice in IPTV?

Consultancy firm Deloitte suggests that the jury is still out as to whether the IPTV sector in the UK can replicate its success in France, where provider Free now has around 1.5m customers and forecasts 2m by the end of 2008.

The report suggests that too much choice may actually put customers off, saying: "For some, choice may be a chore. Choosing a movie a week may be enough deliberation. For the other 20 hours of viewing however, being told what to watch by schedulers skilled at guessing what people want to watch might be an easier option."

Deloitte's report adds that the next year will be a crucial time for the IPTV sector, when further information will become available about customer's attitude to "infinite choice".

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