LOS ANGELES (Reuters) - DreamWorks Animation SKG Chief Executive Jeffrey Katzenberg is betting on 3-D films to the tune of $30 million a year in the hope of bringing a dramatic bump to flat U.S. movie attendance.
"Clearly I'm putting my money where my mouth is and the company's bet on it," said Katzenberg in an interview at his headquarters a day before making his pitch to movie exhibitors in Las Vegas at the annual ShoWest conference.
DreamWorks' 3-D initiative, using proprietary technology and processes, has been in the works for about 18 months and will make its theatrical debut on March 27, 2009 with "Monsters vs. Aliens."
A studio tour revealed more and better special effects than the handful of stunts in 3-D of decades ago. Also, concert movies in 3-D give a feeling closer to being in a live audience, as fans pop off the screen and the band appears staggered on the stage with more realistic depth.
Katzenberg, who plans to make all future films in 3-D, said that with an incremental cost of about $15 million per film for 3-D, DreamWorks -- which aspires to produce two films a year -- is spending about $30 million a year on 3-D.
Citing the recent success of Walt Disney Co's "Hannah Montana" 3-D concert film, Katzenberg has said he not only anticipates 3-D to bring more people back to theaters, but that people will pay sizable premiums to watch these films.
"There has not been anything that's come along now for the better part of 50 years that has created an opportunity to get more people to go to a movie theater in a meaningful way," he told Reuters.
The new technology could increase the number of people who go to the movies, he said. While U.S. box office revenue was up last year, attendance barely budged.
"DreamWorks isn't using 3-D as a gimmick," Katzenberg said. "By applying more of a live-action filmmaking sensibility to our digitally animated three-dimensional films, we can fully immerse moviegoers into the world of the story, he added.
Viewers don't need to wear the cardboard glasses of the past, but they do need special equipment -- polarized glasses that look like slick Ray-Bans.
One of the hurdles facing the industry has been the speed of uptake by cinemas. Some industry experts have cited concerns about whether there will be enough 3-D equipped screens to accommodate a heavy slate of upcoming 3-D titles, including: Disney-Pixar's "Toy Story 3," DreamWorks' "Monsters vs. Aliens," and "Avatar" from "Titanic" director James Cameron.
Katzenberg is optimistic that over the next few years, the amount of 3-D product will coincide with the number of theaters taking on 3-D capabilities.
Several studios and the Digital Cinema Implementation Partners, wholly owned by theater chains Regal Entertainment Group, Cinemark Holdings Inc and AMC Entertainment Inc, which collectively operate more than 14,000 screens, are nearing a $1.1 billion financing deal to deploy in cinemas digital technology.
About 1,000 cinema screens worldwide have 3-D systems, and the number is projected to hit 4,000 by 2009, according to Michael Lewis, chairman of Real D, whose digital projection 3-D technology was used in most theaters showing "Hannah Montana."
About 4,000 of the 37,000 cinema screens in the United States are currently digitally equipped, industry experts estimate.
The ultimate aim within the industry is to transform all 125,000 screens worldwide to digital projection. Once outfitted with digital projectors, theaters can add 3-D capabilities.
"I want to be able to release a movie in 7,000 screens in the U.S. exclusively in 3-D, that's my goal," said Katzenberg.
Reporting by Sue Zeidler, editing by Leslie Gevirtz