Screen Daily talks with IMAX CEO Rich Gelfond

Screen Daily talks with IMAX CEO Richard Gelfond on IMAX’s transformation since its early days and its future profitability:

Increasingly, audiences are seeing Imax less as a novelty and more as an essential viewing experience – especially when certain films are in 3D or sequences are shot on an Imax camera, as Christopher Nolan did on The Dark Knight. With hundreds of retrofitted multiplexes around the world alongside the older, bespoke Imax theatres, the rise of the large-screen format is a trend that Hollywood analysts say is finally going to put the company into profit.

Gelfond is an articulate speaker who seldom pauses before answering a question. However, he takes a moment to reflect when asked about the fundamental changes that promise to put the company in the black after years of struggle. “We’ve freed up the business model,” he says. “Imax has, for its 40-year-plus history, been a wonderful consumer proposition, but it’s taken us a long time to get a business model that has been as good as the consumer model, and that’s because there has been a lot of capital cost for the studios and exhibitors.

“In the early days it cost almost $5m to build an Imax theatre, and it would cost $5m-$10m to make a film and cost $30,000 to make a print. However, over the past five to 10 years we’ve engineered down that cost with the ability to fit technology into a theatre. In the last year we have had an over-the-top push in cost reduction, which is driven by digital expansion and our joint-venture business model [with the exhibitors, retrofitting Imax theatres into multiplexes].

“Digital lowered the cost for exhibitors and added programming flexibility, and helped the studios because it lowered print costs from $30,000 down to around $4,000. The cost of retrofitting was about $150,000-$200,000 and we shared the revenues. Studios were already paying for the movie and we paid for the conversion, and for the exhibitors it didn’t cost too much to retrofit their theatres. That freed up the business model.

“Our network has grown at a rapid pace and in the last year we’ve opened about 100 theatres, two or three a week. We’ve expanded our global footprint and opened our first theatres in Japan, Australia and expanded more rapidly in places like the UK. From the studio point of view, the lower cost of prints means they have been approaching us to release their films.”

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