TOKYO (TR) – Though the studio arm of Toho has made its name by bringing powerful beasts and sword-wielding samurais to the screen over its 75 years, it wasn’t until recently that its exhibition division became a true industry dominator.
Last October, Toho Cinemas, formerly Virgin Cinemas, merged with Toho’s exhibition department to become Japan’s largest exhibitor. But in shaping its future the company will be looking beyond simply girth.
“These days,” explains Chikara Murakami, president of Toho Cinemas, which operates 560 screens, “people can watch DVDs at home on a large, clear screen. So it is vital for us to increase the different types of attractions that we offer.”
This can be seen in the recent trend that has connected the cinema experience to shopping, with screens increasingly popping up inside malls on the outskirts of big cities. To add to its empire, Toho Cinemas is skedded to open a 10-screen multiplex in November at a northern Tokyo shopping center anchored by retail giant Ito Yokado.
“It is beneficial for both shopping centers and multiplex cinemas to work together,” Murakami says. “We do not know whether this combination is the future of the Japanese film exhibition, but for the time being, it is a win-win situation.”
Toho Cinemas will merge four other local Toho exhibition subsidiaries by the beginning of March. By the end of next year the chain expects its total number of screens to be 600, with box office receipts totaling $500 million.
This ongoing restructuring is rooted in the bottom line. In addition to strengthening the organization by focusing on screens clustered in multiplexes, overhead costs can be reduced.
Important, too, has been the push to improve the cramped and unpleasant theaters that have marked the local exhibition industry.
The Virgin Toho Cinemas nine-screen multiplex in Roppongi Hills, one of Tokyo’s ritziest shopping centers, offers a “premier” experience. With select tickets priced at $25, a $10 premium over a regular seat, the theater boasts the largest screen in Japan (28 feet by 66 feet), full-meal dining, and plush cinema seating.
From the perspective of sheer enjoyment, perhaps Toho Cinemas’ most noticeable move is with its ongoing experiment in digital.
The 4K Pure Cinema program, which this month included Steven Soderbergh’s “Ocean’s Thirteen,” involves transmitting film data via fiber lines from Hollywood to Japan. Since the project began in 2005, Toho Cinemas has used up to four digitally equipped theaters in Tokyo and Osaka to screen a handful of films each year, including the pioneering pic “Tim Burton’s Corpse Bride.”
A sharper picture, better sound and easily readable subtitles are all advantages, says Murakami, but the cost of digital equipment — which the prexy puts at three to five times that needed for a conventional theater — is a barrier to full implementation. Murakami believes producers, exhibitors and distributors must agree on a means of sharing this cost before the idea can be fully embraced.
“It is burdensome for the exhibitors to invest such an amount initially for each cinema,” Murakami says. “So there is hesitation because the establishment of an appropriate business model is still ongoing.”
The flexibility of the format, however, might trump the drawbacks. During last year’s World Cup, Toho Cinemas provided digital broadcasts of certain matches. Other nonfilm content, such as shows by the all-female theater troupe Takarazuka and rugby matches, could be coming soon.
By 2011, terrestrial television is expected to switch from analog to digital in Japan. Murakami believes audiences will by then be more accustomed to the format’s high resolution, and it is probable that theater owners will need to cope with this new appetite.
“The digital system is an attractive element,” Murakami says, “in that we can add to the cinema experience and hopefully make our target audience wider and wider.”
Note: This story originally appeared in the August 27th issue of Variety.