The motion picture industry, say many experts, is on the threshold of a breakthrough that could bring dramatic change to the economics of movie theatres and to the moviegoing experience itself. Advocates for change see potential benefits as pristine projected images free of dust and scratches and extended discrete digital audio in-theatre soundfield effects, plus controlled distribution and copy-protection. Even the making of movies would benefit. Electronic cinema would do away with many of the problems associated with film. While movies would still be shot and edited on traditional 35- or 65-millimeter film, and the end-product picture master would be at least initially on film., thereafter, the process would entail making digitalized prints using high-definition film-to video telecine transfers. High-definition transfers began first as the source elements to make non-high-definition home video LaserDisc masters, then high-definition broadcasts for the Japan high-def system, and recently for optimizing picture quality for DVD-Video home delivery and digital HDTV boadcasts. With future theatrical digital projection systems, every subsequent digital copy would be a perfect replica of the high-definition film-to-video master. When projected,there would be no wear and tear from each showing as is the case with film projection.Within two years, movie theatres are expected to begin installing the first generation of digital projectors. Reels of 35-millimeter film - which are several feet in diameter and heavy - would be replaced with electronic projectors that use magnetic tape, high-density digital discs or laser ribbon technology to store the digital code for both picture and sound. On March 10, at a meeting of the National Association of Theatre Owners (NATO) held inconjunction with the ShoWest Convention in Las Vegas, two new electronic projectors - one by Texas Instruments that relies on a chip array with more than a million tiny mirrors, and a competing technology using what is called a light valve produced by Hughes-JVC - will demonstrate what they can do. The same four-minute film clip will be shown on each of the new projectors, as well as a traditional 35-millimeter projector. The theatre owners are expected to witness, in short, the latest in ""electronic cinema"" technology.""The technology now exists to build the projectors,"" said Doug Darrow, the Manager for Market and Business Development of the electronic projector business of Texas Instruments. ""The real issues are economics and emotion. The studios have to say, ëWe want to make this change.í"" Phil Singleton, President of American Multi-Cinemas Inc., a chain with 236 theatres, added, ""We canít wait for the day when weíre unshackled from the 35-millimeter prints. But conversion is first and foremost the biggest problem to face.""Conversion will be the biggest hurdle as the new digital projectors will cost $100,000 or more for each complete booth installation, compared with about $30,000 for a conventional projection booth. Theatre owners insist that the costs will have to be shared, and studio executives are reportedly in general aggrement. The studios stand to reduce their distribution costs substantially. With digital distribution via satellite broadcast, the studios will no longer have to create and ship thousands of reels of film. Each print costs in the neighborhood of $2,000, and a major film requires from 2,000 to 5,000 prints.""As it stands, most of the savings would go to the studios and the costs would go to the theatre owners,"" said William F. Kartozian, President of the National Association of Theatre Owners. ""Obviously, this will have to be a cooperative effort. Unless itís good for everybody itís just not going to happen."" While there is no doubt about what benefits electronic cinema will create, is the technology really there to deliver those benefits?""I went into one demonstration where the only way I could tell the difference between the film and the electronic version was that the film one had that jittery movement and the electronic one didnít,"" said Martin Cohen, the head of post-production at DreamWorks SKG. ""They are down to the nitty-gritty. Theyíre finally in the ball park on the quality.""In the initial stages of electronic cinema, digital movies are likely to be delivered to theatres in the form of electronic digital videotape or discs. Eventually, however, they are expected to be delivered via satellite, then stored on a server in the theatres. Either way would be welcomed, especially by theatres in smaller towns who must wait days or even weeks to get prints of popular movies following their big city openings. The new system, however digitally based, could deliver the new films simultaneously to all markets.Digital Theater Systems (DTSÆ) pioneered putting 6 to 8 channels of discrete digital soundtrack audio on CD-ROM discs with time code on the film print used to synchronize the picture with the soundtrack. Different language soundtracks are provided on disc without having to strike new prints. DTS is believed to be working on a new theatrical system that uses extremely high bit-rate digital coding and more channels to create new in-theatre holosonic three-dimensional soundfield experiences. The new system will use higher density DVD-ROM drives and discs. DTS technology could effectively become the soundtrack component of the new system. Conventional systems already use digital sound, and generally have 6 tracks available for the audio portion of the movie. Sonyís SDDS system is capable of up to 8 tracks, but 5 of those tracks are positioned for screen channels, not to expand the holosonic soundfield experience. Similiarly is DTSí 8-track system used for 70mm projection. The new electronic cinema systems could handle as many as 12 (or more) audio channels. Those additional channels would permit innovations that could dramatically better the movie experience. There could be everything from sound from above, behind, to the sides, and below the audiences to programs in which a digital signal engages devices, such as Clark Synthesisí Tactiles, that shake the seats on cue, or devices that even emit smells into the theatre. The new projectors are fully capable of projecting screen images with the quality of high-definition digital television to accommodate theatres who want to do pay-per-view showings of prize fights, concerts or other live events.One hurdle facing electronic cinema is copy protection. It is currently estimated by the motion picture industry that the studios lose perhaps $3 billion a year or more to illegal copying of films. Most of the studios fear that, if movies are sent to theaters through a satellite transmission, cyberthieves might be able to intercept the signal and steal a perfect copy.A number of companies are working on sophisticated technology for encrypting movie transmission. Cinecomm, a new company jointly owned by Qualcomm Inc, which produces telecommunications equipment, and Hughes-JVC, a unit of JVC of Japan that produces a digital projector, is one of the companies that has developed robust encryption. Divxís encryption is being proposed to the studios as another encryption system. Divx technology was used on a prototype HD DVD-Video player at the recent Consumer Electronics Show (CES) by Thomson to demonstrate high-definition on discs.But one of the biggest issues is who will control the digital satalette transmission to the theatres, and what it will cost. Cinecommís solution is to provide one stop shopping by providing the satellite uplink facilities, the dishes for the theatres, the systems for encrypting and compressing the transmissions, the systems for decrypting decompressing, and the projectors. Cinecomm proposal calls for charging theatres (and movie studios) a fee based on the number of showings of each movie. The company says it will pay the initial costs associated with individual theatre equipment conversion to the digital transmission and projection system. Under this scenario, the studio distributors and theatre exhibitors would be dependent on a single supplier with Cinecomm serving as provider and gatekeeper.At this point no encryption system has been accepted or endorsed by any of the major studios. The upcoming ShoWest is certain to be a forum for much discussion of these issues. Stay tuned.