Premium large formats and immersive 3D technologies are revolutionizing the traditional movie-going experience and engaging the senses of audiences like never before. For an inside look behind the visual splendor of 3D, Travis Reid of RealD joins Wim and Jim to discuss how the technology continues to evolve and enhance storytelling on the big screen.
Jim: Hey Insiders, before we start today, we wanna take a moment and thank you all for listening. We’ve heard from many of you, from all over the world, that you listen to the program and we wanna say thank you. We have obtained some Barbie t-shirts and some Super Mario Brothers t-shirts, and if you’ll email us, we’d love to send you a free t-shirt with just our thanks for being a part of our family. Send your email to insiders.t-shirt — one word — email@example.com. Tell us what size you are, whether you want a Barbie t-shirt, or a Mario Brothers t-shirt, and tell us your mailing address, so we’ll know where to mail the t-shirt to you, and tell us where you’re listening from. Thank you so much for being a part of our insiders family.
Jim: Welcome to the Inside. This is one of those moments when movies made history and gave the cinema business the chance to prove that movies are bigger than ever. Barbie and Oppenheimer dominated the box office and set records this month. Barbie now stands at over $1 billion in just two weeks, and Oppenheimer is approaching $450 million at the worldwide box office, led by premium format screens. The two films delivered audiences and revenues to the record breaking levels of 2019 before the pandemic. I am Jim Chabin in Los Angeles, and with me is Wim Buyens. He serves as CEO of Cinionic and he joins us live from Brussels, Belgium, where it’s evening. Good evening, Wim.
Wim: Hey, good morning Jim. Good to see you.
Jim: Wim, it’s so good to hear your voice. Let me just read some of the information that is coming out of this extraordinary moment at the box office. AMC Theaters hit a record revenue number last week, driven by the overwhelming success of “BarbenHeimer.” The world’s largest theater chain announced that from July 21 through 27, it earned the largest single week admissions revenue since the company’s founding in 1920. This is the fourth biggest weekend in box office history. Barbie’s number one in 57 countries, including Taiwan and Germany, and Indonesia and UK and Spain and Italy and Argentina. It’s the second biggest movie in Warner Brothers history behind Joker. Directed by Christopher Nolan, Oppenheimer just dropped 26% in its second week. It’s the biggest Christopher Nolan film in 28 countries from India to Saudi Arabia to Turkey. Also Elemental from Pixar, which people were worried about because it didn’t come out of the chute quite as strong as people thought. It’s now crossing over $400 million at the box office. Also doing well — Sound of Freedom. Indiana Jones is still in theaters. Mission: Impossible is still in theaters. What a fantastic moment here for our business.
Wim: It is Jim, it is. You know, we always say it’s hard to predict which movie’s gonna run the best! If you would’ve tried to predict it, you know, everybody said those are two big movies, right? Like, we have a whole bunch of other big movies, big titles this year. But the other thing was, what I liked was, the enthusiasm during the movie, right? The Oppenheimer movie as an example, you know, everybody was staying at a high tension the whole movie, even though it’s a long movie, but there was no moment you thought, it’s a long movie. No, we were just hanging on there, which was fantastic. On the Barbie one then, people were, were cheering into the, you know the crowd was cheering and things like that. So, so enjoying the moment there. So it was really a good treat and I think both, done stunning, like you said, box office wise, but also from a creative point of view, right? I think they both brought something different, something special. So, it’s great to see that coming together.
Jim: Well, they both delivered on their promise, right? These are films that were at CinemaCon in Las Vegas and the directors were there and talked about how important these films are, and there was a lot of hype around it. But they delivered, they got “A” cinema scores from audiences leaving. They’re both doing great; better than 90% on Rotten Tomatoes. So it’s, it’s one of those things where the movies lived up to the hype and it makes it all the more exciting.
Wim: No, you’re right. I mean, I heard people say, we wanna see the movie again. We wanna see them a second time. But I wanna see them in a different experience, right? I wanna see them in a private setting. I wanna see them in an IMAX or in a premium setting. So this is what these titles really do well, and I think that, it shows things coming together. I think the content is really made for the big screen, there’s no doubt about it, but also the different experiences on the big screen and people have choices. And I think as an industry it shows the proof point that we have to keep on investing in providing different experiences so that the audience can choose. And the directors did a good job in bringing fantastic content to bring on those screens today.
Jim: With that in mind, we couldn’t have a better guest, speaking of premium experiences, than our guest today. Travis Reid serves as president and CEO of RealD, the world’s leader in 3D cinema. The company’s 3D technology has served as a partner for filmmakers and studios who have used the RealD system to present recent blockbusters, including Guardians of the Galaxy, The Little Mermaid, Transformers: Rise of the Beasts, Elemental, and of course, Avatar: The Way of Water. Prior to RealD Travis served as CEO of Loewes Cineplex Entertainment, ScreenVision, and the DCIP consortium. He joins us today from Los Angeles and we’re thrilled to have him. Welcome, Travis.
Travis: Thank you, Jim. Happy to be with you.
Wim: Travis, first of all, fantastic to have you here with us. How is 3D performing in 2023? What’s your view on this?
Travis: Well, so it’s been a real interesting ride for us on the 3D market, because 3D was probably the most impacted format through the pandemic. Patrons were really looking to limit the touch points as were the staff. So we saw 3D go practically to nothing, and then it came back slowly in 2021. And then in 2022, we found a really interesting thing starting with Dr. Strange and through Thor, and we saw results that were already higher than 2018 and ’19, we thought it would take Avatar to get us there, but we saw that happen for the balance of 2022. And then of course, Avatar just exploded. It was everything that we had hoped for and waited for, for so long. We saw that the satisfaction scores with those that saw in 3D versus 2D were quite a bit higher. The majority of those polled told us that they were more interested in seeing more 3D movies than they were before seeing this movie. So really, it was just a fantastic story for us, for the industry and for the patrons. It just had a huge satisfaction rate.
Jim: John Landau, Jim’s Cameron’s producing partner, was quoted recently in the press as saying that making a movie in 3D doesn’t really change the movie, it enhances whatever the movie is. He said, it’s no different than lighting or focus or camera movement. A filmmaker needs to bring a sensibility of how to use that to enhance that narrative storytelling. With that in mind, what do you tell filmmakers when you’re asked when and where to use 3D Travis?
Travis: You know it varies on the experience. Scream was in 3D recently that’s gonna be used differently, right? That’s gonna be used to amplify a scary moment, and I thought it was really very effective. Then you look at what James Cameron did with Avatar and he just created environment that you didn’t know where the screen was. You know, sometimes things were in front, more times it was depth. So, more of the opportunities, we believe, are the usage that, like James Cameron’s, to really just create a more immersive situation where the plane of the screen just sort of disappears and you’re in the environment. That’s what we think is the most effective use in most cases.
Wim: Travis RealD has been offering specialty screenings, also using 3D posters, billboards to market the upcoming titles. How has co-promotion with studios helped drive audiences to consume the 3D content?
Travis: Yeah, I think we’ve had really good results when we’re able to get the studios to give us some good assets on an early timeframe, and especially they’ll invite us to their content days and their premiers and we’ll be able to capture some footage of a star or the filmmaker advocating for 3D. We find that those things really make a difference, particularly of a known filmmaker or a very credible actor, really calling out 3D and endorsing it. We see a jump when we get that kind of result.
Jim: I’ve got a question for both of you. A recent article by writer Lane Brown of Vulture, shared the fact that many of the original projectors sold for the original Avatar in 2009 are now older and use last-generation bulb technology, and in desperate need of replacement. Is laser rolling out fast enough? And Travis, I’ll start with you. What does laser do for 3D?
Travis: Oh, it’s a real game changer to me. I mean, the brightness is there. The contrast levels are enhanced, so I think it’s a big, big improvement with this new equipment. The one thing that we and Disney, we did a pretty thorough case study to see what kind of light levels each theater could accommodate. In most cases, there’s screens in those buildings that can reach pretty decent levels. So, we were able to help guide that a bit to get to the right auditoriums, the right presentation level. But as this next cycle comes in, I think it’s gonna improve the baseline significantly.
Jim: Wim, are the cinema operators changing out that old technology fast enough to take advantage of Travis’s movies?
Wim: With laser I think, like Travis said it very well, I mean, it is a game changer, but also with laser, we can operate the projector as a digital instrument. What I mean by that is, when you put in a lamp, you just have to, whatever the age of the lamp is, undergoing you know what the performance is, at that point in time. With laser, you can stream up and get more power out of it for that specific movie. Those capabilities are not possible with lamp projectors. So I think that we can make 3D shine much brighter, better, and by that influences the quality expectation, or better the satisfaction of the moviegoer afterwards. So I think as a whole industry, we need to embrace that as soon as we, of course, economically can, because the movie-goer expects it.
Travis: You know what I would just add, I have been really pleasantly surprised at the amount of change that is taking place where they’re upgrading. And not to be specific about any particular circuit, but most of the circuits are doing some upgrades and we know that it’s still a tough economic situation for them. So I applaud them that they’re really leaning into the future. A lot more has gotten done than I would’ve expected given the state of the recovery that we’re kind of just getting there at this point.
Jim: What does the power of what we’ve just seen with Barbie and Oppenheimer at the box office and cinema’s packed, really, and the sensation is global, what impact is that having on your business and the ability to look out in the next few years with optimism about the health of the cinema business and Travis, we’ll start with you.
Travis: Yeah, well, I think it’s a huge signal. This phenomenon is really interesting in that I feel like generally studios are focused on finding a runway for their movie where there’s not something that’s a real strong title in that demographic that they expect to play to for the most part on that movie. This case, these two did have slightly different demographics. I would say they’ve helped each other rather than actually just didn’t impact each other. And that’s a real phenomenon that I don’t think we’ve seen too often. Sometimes there’d be a Christmas slate where there’s ten good movies, five of them nominated for awards, and I felt that helped through January for that kind of a slight effect as well. But this is a really unique situation where I don’t think anybody could have planned it, and nobody did plan it, but these two movies are helping each other, and I hope that’s a dynamic that somehow plays out more often in the future.
Jim: There have been quite a few commentaries from studios and analysts that movie-going’s on the wane and the pandemic hurt movie-going, which it did, but what do you think the last few weeks and these two films mean for the overall confidence in the cinema business that you touch worldwide?
Wim: When we talk with customers, they typically said, yeah, we are committing to the future of technology, but the speed of rolling it out will be dependant on how the box office performs. And the proof is in the pudding. And it’s not just what the slate, which looks good, but it’s about how the box office performs. So I’m very positive encouraged with, because it’s always what is the next quarter gonna do, what is the last quarter has done? And we need a few of consecutive good quarters. And this is showing definitely a very strong quarter we are moving into now. So that is the proof we need for people to be confident.
Jim: I was at the cineplex and as I was walking down the the hallway to Oppenheimer, you would see Mission: Impossible, Indiana Jones, Elemental, Sound of Freedom. So as you walk down the hallway, you saw five great movie titles and then Oppenheimer and Barbie, and you realize we really are in that moment. To your point, Travis, around the Christmas time when there are lots of good movies, where we’ve got a great number of movies, and then everybody was discussing, when are you seeing X, when are you going to the movies? Going to the movies became an urgent kind of thing that everybody wanted to participate in.
Travis: Jim, you bring up a really good point there, there were four other movies domestically that did over $10 million this weekend. So we had depth as well as strength.
Jim: Fantastic. Our guest insider today is Travis Reid of RealD. We’ll be right back.
Ad Spot: The Insiders Show is made possible through the generous support of Cinionic, providing future-ready technical solutions to cinemas. With more than 100,000 projectors installed, Cinionic now illuminates more than half of the world’s cinemas every day. Visit cinionic.com.
Jim: Our guest today is Travis Reid. He serves as president and CEO of RealD, the world’s leader in premium 3D technology.
Wim: Travis, what do you make about the new Apple Vision Pro headsets and it’s 3D capability?
Travis: I haven’t yet tried it myself. I think our hope and expectation is that this becomes another use for the 3D conversions, that there’s another way consumers are seeing 3D and I would expect that that will be a very high quality, although singular experience. And I think that could be a helpful driver. You know, 3D didn’t successfully integrate into the home entertainment systems. You know, with 3D you wanna be at the right viewing angles. You want the light levels to be right and you know, in a living room it could be any situation. The TV could be four feet too high for a good viewing angle. There’s just a lot of additional variables that you can’t control like you would in a theater environment.
Wim: Do you think that the Apple Vision Pro will influence the amount of people going to a 3D experience in a cinema?
Travis: It could be another revenue stream for studios to be convinced to convert to a 3D on a movie that they think is kind of on the edge of whether it would be financially accruent to them. And then I think that it could be a great marketing tool for 3D because I expect the experience will be great.
Jim: Films like Guardians of the Galaxy and The Little Mermaid, of course, Avatar and Super Mario Brothers all offered in 3D, and probably the most common question I get is, What percentage of those movie tickets are 3D tickets? What’s kind of the average?
Travis: The average is about 20% of the box office on a 3D-enabled movie being in 3D tickets sold. The biggest variable there, frankly, is market mix, is some markets have very high 3D percentages and some are lower. So it kind of depends on the regionality, like Transformers after Avatar had the highest total box office, I think about 40% of the tickets sold were 3D performances on Transformers. That had very strong 3D characteristics, it had strong take rates everywhere, but the biggest piece of that was that it performed really high in certain markets that are always high take rates.
Jim: China’s always been a one of those markets that, at least in my experience, they love and consider 3D to be a premium way to see the motion picture, period. Does China continue to lead the world as far as 3D ticket sales?
Travis: I guess the answer to that is that it isn’t right now, but it’s because there’s been a shift, at least temporarily here to, I believe 81% of the box office in China, year to date, is on Chinese films. So there’s been a much lower performance on some of the MPA films, but Transformers was an example of a very strong performance in China that had almost a hundred percent take rate. Same thing on Fast 10, but a lot of the movies have not performed the way that they would’ve historically, and I’m not sure what’s happening there.
Jim: If 80% of that box office is domestic content in China, are there 3D filmmakers within that 80%? Are there 3D films there?
Travis: Cost of conversion, you know, Chinese films don’t play very strongly anywhere else. So it’s about what it will do in China and what kind of genre it is. There’s a lot of lower budget movies there as well that would not, but there are 3D enabled Chinese films often on the animateds, in particular.
Wim: Travis, directors like James Cameron and I think, you know, years ago also people like Jeffrey Katzenberg, which was the beginning of 3D, worked very closely with RealD right? You have really being the company, which is really echoing what 3D is all about. How does filmmakers describe the value about RealD and how do they see the value you bring to the movies, to their films? How would they describe that?
Travis: I think the biggest impact that we have is we’re the only pure 3D company, because IMAX and Dolby, they do 3D, but we’re the only ones that I think are participative. We don’t sell our equipment. We provide it to the exhibitors generally on our expense. And then we have participative deals. So we’re the only company other than the studios and exhibitors themselves that are marketing 3D. And so our biggest role today is we spend a lot of time at every releasing distributor of a 3D movie. The studios are very helpful with us. They create specific assets for us that we can use to promote the 3D presentations of the films they’re releasing in 3D. And then we go to the exhibitors and we use the exhibitor’s media assets so that we can actually use those assets to directly reach ticket buyers. When it’s not a sale model, you have skin in the game, and you continue to work with the parties to try to maximize the opportunity, versus just looking to sell them something.
Jim: Travis, Wim and I were just speaking about the popularity of the premium format and the perception that many of these filmmakers are making their films to be seen on the big screen. They talk about it. Tom Cruise talked about it, Christopher Nolan talked about it, and to see it in a premium format, whether that’s XD or IMAX 3D is a premium way of seeing it. How does it fit into that and what parts of the world do you see growth opportunities for the 3D filmmakers?
Travis: That’s an interesting question. So there are some growth markets. India is a market that we’re deploying new equipment all the time. It’s already a huge marketplace, but it’s the subset of the marketplace that’s actually playing the MPA films, and leaning into 3D now. And we’re working with them in that market also to create more marketing, more awareness of the 3D format. Indonesia’s and other area, North Africa. So there’s multiple markets that are developing in terms of a 3D ecosystem. Most of the other markets have been pretty mature. Latin America is a very, very good market for us. Europe is a very good market, although it’s interesting, you can have countries side by side, one that does very strong 3D and one not as much. And those are the kinds of things we’re working on to try and demonstrate the value of those parties, start to lean into it a little bit more.
Jim: Travis, how much is the average premium for a 3D ticket today?
Travis: Well, that varies significantly by market and it’s both market driven and strategy driven. The domestic market is about $3 and 25 cents on average of charge, which is one of the higher levels in the world. In some markets like Latin America, it’s much, much lower. There’s also different models, which, I don’t know, we don’t have to go too deep on that. In the domestic market, the patron doesn’t pay anything for glasses. In some other markets, the 3D ticket charge is quite a bit lower, but they sell glasses. So there’s different models in different markets.
Jim: There’s a cost involved in conversion or creating a 3D movie, and various assessments that we hear are $3 to $5 million and, obviously that adds to the cost. So when you’re advising filmmakers, at what level does a movie need to be at in order to easily recoup the investment in 3D?
Travis: You know, that’s a good question, and it obviously is varied based on what the average take rates and the regionality of a given film. A movie that’s gonna do $300 million or more in most cases, is a good candidate for a conversion — a global number.
Wim: The promise of 3D without glasses: is that something which is gonna happen Travis? Is that something you guys believe in or working on?
Travis: We’ve have had our scientists work on that. We think it’s a long ways away for a multiple-person experience. I think it’s pretty achievable on a single-person experience over the next few years, but when it comes to like, how do you make that work in an auditorium with lots of different viewing angles, that’s a pretty big challenge. We don’t really see a timeline on that yet, until there’s some kind of breakthrough.
Jim: Travis, you’ve had a distinguished career on so many levels with Loewes and ScreenVision and DCIP. I mean, you’ve really helped develop so many of the evolutions the industry has had over the last few decades and really been at the forefront. How do you feel about the cinema business? You’ve seen it from so many different sides. How do you feel about it and its future?
Travis: I think the results that we’re seeing now are just both the overall box office and attendance levels, the higher expenditures that people are doing when they go to the movies. And it’s not just on the premiums, but I think the food services and such, and the exhibitors have done a good job of expanding their offerings to meet these demands, and I think it’s got a very positive future. There are probably some theaters that need to come offline. That’s probably been true forever. But in the long term, it feels really good to me that way things are coming back right now. We’re all worried about the strikes and what that impact will be, but other than that, I think all the signs are really positive we’re getting back to having a very robust, large platform of theaters that do really well globally.
Jim: Well, Travis, we’re lucky that you are in our business. You take on the big tasks of our industry and you do it so well, and we’re so grateful that you’re taking the lead on premium technologies like 3D. So, thank you so much for being with us.
Travis: Thank you, Jim, and thank you, Wim.
Wim: Thank you, Travis.
Jim: Our quote of the day comes from Francis Ford Coppola. He wrote, Barbie and Oppenheimer are a victory for cinema with a capital C. The fact that people are filling big theaters to see them and they are original and not sequels is a victory for cinema. My hunch is that we’re on the verge of a golden age, wonderfully illuminating cinema seen in theaters. Thank you, Wim. Thank you, Travis. Thank you all for listening.
Jim: The Insiders is presented by Cinionic and produced by the Advanced Imaging Society in Hollywood. Our executive producers are Adam Cassels in New York and Mike Piltzecker in Los Angeles. Brett Harrison produced today‘s show and our technical director is Matthew Bach-Lombardo. This is AIS.