By Graham Winfrey | Indiewire April 8, 2014 at 7:39AM
Last week, New York City arthouse theater Brooklyn Heights Cinema was in danger of going out of business if it didn’t raise $30,000 to purchase a digital projection system.
With just hours to go before hitting an Indiegogo deadline, the theater had raised about $26,500 toward its $30,000 goal. An extension from Indiegogo gave the cinema an extra week to reach its target, and early Tuesday, the theater ended its fundraising campaign with more than $32,500 raised. Brooklyn Heights Cinema owner Kenn Lowy estimated that without digital projection, the theater would have been forced to close its doors in a matter of weeks.
"Memorial Day season is really only six weeks away," Lowy said. "I don't think we would have made it that far."
As an added bonus, Lowy received an additional $5,000 check from Donna and Evan Wuhl – brother of the actor Robert Wuhl – separate from the Indiegogo campaign. With the extra money, Lowy plans to add a Blu-ray projector to the new digital projection system, which will allow the theater to show small independent films released on Blu-ray disc.
"With the $5,000 we can definitely afford it, so we’ll get that as well," Lowy said.
Hollywood studios have been working to phase out 35-millimeter film prints and transition to distribution via inexpensive hard drives known as Digital Cinema Packages.
"All of the distributors and film companies just kind of decided at the same time," Lowy said. "They kind of warned everybody it was coming, but then all of a sudden it was there."
Recent blockbusters such as Martin Scorsese's "The Wolf of Wall Street" and David O. Russell's "American Hustle" are among the list of films to be released in digital-only formats. According to the Motion Picture Association of America, more than 80 percent of the world's nearly 135,000 cinema screens are now digital. Digital screens in the United States account for 93 percent of all screens throughout the country, and soon all new films will be exclusively digital.
Many mom-and-pop theaters throughout the United States have struggled in recent years to cover the cost of converting to digital projection, with some turning to crowdfunding to raise the necessary funds. Last September, the Rogers City Theater in Northeast Michigan raised more than $116,000 on Kickstarter to purchase digital projection equipment.
The National Association of Theater Owners estimates that thousands of screens throughout the country could be shuttered due to the cost of digital projection systems, many of which sell for between $70,000 and $80,000.
Brooklyn Heights Cinema is purchasing a used digital projector for less than half the cost of most digital projectors. For months leading up to the Indiegogo effort, Lowy had mentioned the plan to raise money for a digital projector to the theater’s patrons, many of whom pledged their support.
"For the past 100 years, movies have been printed on film. But technology marches on and film studios and distributors have announced that 35mm film will no longer be produced and will be replaced by digital files. It has been estimated that up to 20% of theaters across North America, representing up to 10,000 screens, may close because they will be unable to afford to upgrade. We're hoping that we won't be one of them," the theater posted on its Indiegogo page at the beginning of the campaign.
Luckily, thanks to the successful crowd funding campaign, the theater seems to be in good shape to make the digital transition.
Graham Winfrey is Associate Editor at Private Equity International magazine and was a member of Indiewire and The Film Society Of Lincoln Center's 2013 Critics Academy.