1 DCinemaPhilosophy

Digital Cinema:
Observations and Considerations
Is it the next great leap or an invitation to confusion? Business

as usual or a completely new model? Digital cinema is at hand,
no doubt about it. But just what will it involve? Will it prove to
be genuine progress, or technology for its own sake?
Dolby Laboratories has been looking closely at D-cinema issues

over the last few years. Drawing on our long experience in merging
technological advances with existing systems, we frequently also
step back and take a broader view. We have analyzed what will be
needed for the transition, what will work well for production houses
and exhibitors alike, and especially, what will give audiences an
ever-better cinema experience. We recognize concerns about
technology, security, quality, reliability, and compatibility. Based
on our research, we have reached some general conclusions and
developed some more-specific recommendations.
The Need for Dedicated Products

One general conclusion is that D-cinema will need dedicated products. Our
Production Services Group has contracted for many of the current D-cinema
installations, interfacing the new world of satellites, Ethernet, and megabytes with
the existing sprockets, relays, and xenon strikes. This firsthand experience has led
us to realize that rolling out D-cinema will take more than just a video projector and
a server. The wide variety in existing cinema installations means that a successful
rollout will unlikely be accomplished with off-the-shelf equipment repurposed for
the cinema industry. Some believe repurposed products will enable our industry to
take advantage of the economies of scale afforded by the broadcast or consumer
industries. We believe this is not true due to operational and reliability limitations
of equipment that was not designed for the cinema. Furthermore, they may not
offer the flexibility to support new image formats and other standards as they
are established.
The Importance of Open, Global Standards

Having worked in film industries from Hollywood to Paris, Bollywood to Beijing, Dolby
has a true understanding of the need for long-lasting and effective international
standards. We strongly support open standards that will allow exhibitors to choose
among equipment suppliers, yet encourage innovation. We are actively involved in
all the significant standards bodies in the US and Europe, helping to define these
open standards while cautioning the organizations not to be too restrictive overall,
a stance which could stifle competition. Carefully defining the significant interface
points—such as an open standard for the encoded movie files—will enable D-cinema
system customers to choose among manufacturers while maintaining interoperability.
Digital Cinema:
Observations and Considerations
From Studio to Screen

Based on our experience in rolling out Dolby® Stereo and Dolby Digital, we’re
convinced that for any new cinema technology to be successful, it has to be
practical enough for adoption throughout the content chain. Film production,
distribution, and exhibition are separate industries, each with its own requirements.
Creating formats that flow between them is a significant enough challenge when
just a single company is providing encoding and decoding equipment, as we do
with audio. But when the technology is open to interpretation and implementation
by many entities, and as complex as today’s digital systems, the need for hand-holding
from studio to screen is greater than ever. That is why we are taking a complete
system approach in our vision for digital cinema, developing not just cinema
playback equipment but also support services, such as mastering and quality
control, to help smooth the flow of content and ensure that any solutions
are practical to adopt.
Reliability
In developing a new generation of cinema playback equipment, one of our primary
goals is to achieve reliability at least equal to today’s traditional film systems. Many
of our cinema audio processors have outlived the cinemas that housed them, and
we see no reason why digital cinema products should be any different. Our completely
digital CP650, for example, offers outstanding reliability and provides a benchmark
for new products. And even though a digital cinema storage device includes sensitive
parts, like hard drives, careful design can result in systems that are resilient to the
projection booth environment, and that can continue operation even if individual
drives fail.
A Solution to Piracy?
Digital cinema represents a serious threat to the industry—but also a tremendous
opportunity. The threat is film piracy, because the digital file is of the ultimate
quality. Were it stolen, then the copies on the streets or the Internet would be
identical to the director’s master—at which point all value vanishes. Furthermore,
as the files move from the studio to the distributor to the exhibitor, and are
eventually stored in the cinema, the chain has many potential weak spots.
But here’s the tremendous opportunity: with careful system design, the digital file
can be protected at each stage far more effectively than has ever been possible with
the film print. Sophisticated encryption techniques can easily keep the data secure
at every step, from the production house all the way to the cinema. Equally, good
engineering design of the cinema devices can ensure that the data is never “in the
clear”—that is, never unencrypted and extractable.
Finally, as the film is projected, techniques are in development to thwart the
camcorder pirate. Until these are viable, current watermarking techniques at
least allow tracing where and when the copy was made. To this end, Dolby in
2003 acquired Cinea, a team of content protection experts with significant
D-cinema experience.
So security actually represents a big plus for D-cinema. A system that’s well thought
out from end to end, designed with security in mind from the ground up, gives the
industry the unprecedented opportunity to protect content from even the most
determined criminal, and from the threat that piracy poses.
Business as Usual? Yes

We must remember that cinema is indeed a business, with business relationships
firmly established among distribution, exhibition, and their respective suppliers.
In designing a next-generation film presentation system, we will work to enable
continuation of current business practices with as little disruption as possible.
While D-cinema will eventually simplify certain aspects of both distribution and
exhibition, we must be careful not to let technology for its own sake force changes
in business practices. Any changes should evolve only with experience, at a pace
acceptable to both parties, and only with their active involvement.
The Ultimate Cinema Experience

Dolby’s goals have always been twofold: first, to provide filmmakers with tools to
tell their stories in the most effective way possible; and second, to make sure as
many cinemagoers as possible see the films as their creators intended. We believe
that digital cinema will provide multiple opportunities for further innovations within
the framework of the open standards currently being discussed by Digital Cinema
Initiatives (DCI) and others. We also think that the quality of both picture and sound
will continue to improve, and that these improvements will keep audiences coming
back for more.
To ensure that our digital cinema systems deliver on the promise of outstanding
images, with quality at least as good as the best 35 mm prints, we have steadily
built an image technology team already renowned in Hollywood for high-quality
video. We were thus able to actively participate with DCI in the evaluation of an
image compression system for D-cinema. Beyond much better video and audio,
an entirely digital system will provide optimum playback of any film in any cinema,
regardless of the film’s format or the specifics of the installation. Such flexibility
and consistency will be a great improvement over today’s presentations.
continued on back
Where We’re Coming From
Ever since we introduced Dolby Stereo, cinema technology has played a leading role
in our company’s history. Dolby Stereo brought a practical multichannel sound
system within the reach of all cinemas, not just the roadshow houses. We followed
with Dolby SR, Dolby Digital, and Dolby Digital Surround EX™—each making the
cinematic experience more real and more exciting, each giving customers all the
more reason to buy tickets.
Throughout, we’ve always focused on solutions that will work for all parts of the
film industry. We’ve stressed compatibility, with existing production techniques and
in-place exhibition equipment. We’ve emphasized reliability and cost-effectiveness.
As we—and the industry—move toward digital, these same considerations remain in
the forefront of our thinking.
Of course, some of our thinking is already evident in our current product range.
Our latest cinema sound processor, the CP650, includes digital inputs, Ethernet
capability, and the extra processing power that might be needed for a future sound
format. These features have already been used in many of the current D-cinema
installations, and currently there are almost 13,000 processors out there, ready and
waiting. We have also designed two integration products specifically for D-cinema,
the DMA8 Digital Media Adapter and the NA10 Network Automation Interface. They
help integrate the new formats with existing audio and automation systems.
In Conclusion
Some issues remain for D-cinema, but we believe the industry has the will to resolve
them and move forward in the very near future. In the meantime, DCI (together with
the standards bodies) is developing what was once considered impossible—a technical
specification based on open standards and agreed to by numerous industry experts.
The experiments of the past three years have been valuable in determining what
works and what doesn’t. The roll-out phase is almost here and Dolby hopes to be
there with you, offering practical and reliable digital cinema products and services
that benefit filmmakers, exhibitors, and especially the audience.
Dolby and the double-D symbol are registered trademarks of Dolby Laboratories. Surround EX is a trademark of Dolby Laboratories.
© 2004 Dolby Laboratories, Inc. S04/15258

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Digital Cinema:

Observations and Considerations

Is it the next great leap or an invitation to confusion? Business

Dolby Laboratories has been looking closely at D-cinema issues

The Need for Dedicated Products

The Importance of Open, Global Standards

From Studio to Screen

Business as Usual? Yes

The Ultimate Cinema Experience

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