Cinema owners may not have ordered popcorn to watch Monday’s Budget speech, but the Finance Minister was their knight in a shining suit when he announced funding for digitisation.
A total of €500,000 will be allocated to cinemas over two years to help them make the upgrades necessary to show movies in digital format.
“This assistance will safeguard the industry for the future,” said Simon De Cesare, general manager of Eden Leisure Group, which owns Eden Cinemas in St Julian’s.
He added exhibitors had been asking for Government support since 2011 because of the “unfair situation we are facing due to Malta’s size”.
“We are extremely grateful that this administration has finally taken it forward.”
Earlier this year, Times of Malta reported that cinemas faced having to downsize or close because they were denied access to overseas funding for digital technology. They were faced with the stark choice as Hollywood studios were expected to cease producing 35mm film prints for major markets by the end of 2013.
In most countries, cinema chains and collectives can apply for a subsidy from movie studios and distributors to replace 35mm projectors with digital equipment.
Known as a Virtual Print Fee (VPF), this financing mechanism was designed to share out the savings made from distributing digital prints instead of film prints. But Maltese cinemas had been denied access to VPF because Hollywood studios and distributors felt the potential returns did not outweigh the risks due to Malta’s size.
The Culture Parliamentary Secretariat has yet to respond to questions on how the funds will be shared among picture houses.
Although cinemas were consulted at length over the scheme, Mr De Cesare said he had not received official confirmation of the final details.
“I believe the funding would be according to the normal EU support mechanisms, that is: 50 per cent of the total investment for small companies, 40 per cent for medium companies and 30 per cent for large companies,” Mr De Cesare said.
He said this should be sufficient to convert to digital all the screens in the country that have not been converted already.
“This assistance will allow exhibitors to continue their normal investment plans,” Mr De Cesare said.
In addition to its State funding, Eden Cinemas is earmarking €500,000 for investment in digital equipment and a further €250,000 in product upgrades and refurbishments.
Cinema managers estimate the cost of converting one screen to digital from €40,000 to €60,000.
Bettina Azzopardi, managing director of Embassy Cinemaworld, said exhibitors had exhausted all options for overseas funding before they turned to the Government.
“We welcome any assistance towards the substantial cost of digitisation that will allow us to continue operating cinemas in Valletta,” she said.
Tal-Lira Cinemas managing director Malcolm Sant said the funding was “needed to ensure the cinema industry survives during this uncertain period”.