Will Home Video Finally Cause the Demise of the Movie Theater?

The enormous new 105" 4K curved screen monitor from LG.
The enormous new 105″ 4K curved screen monitor from LG.

Okay, so the Hollywood studios have agonized over being killed off by home electronics many times in the past.  Way back when VHS and Beta taping first came out, they sued to keep the technology out of consumer hands, for fear that the ability to record and replay video at home would mean the end of movies.

Of course, they were spectacularly wrong about that, as they have also been with most other new technological advancements, and rather than threats, these new technologies have proven to be enormously profitable new sources of revenue – studios now can get as much as half their total revenue from a movie via new media income such as DVDs, rentals, streaming, and so on.  Old movies that had long ago been forgotten have now been released and re-released several times onto tape and disc, each time bringing in a new wave of income for the studio.

But there’s a new technology being rolled out at present which the studios seem to be passively not picking up on, and which may indeed prove to be a real threat, albeit to the movie theater more than the movie studio, although if the studios lose their theater revenues (about half the ticket price you pay to watch a movie goes back to the studio) one wonders what impact that will have on how at-home video watching will be charged in the future.

The new technology is the development of larger and larger video display screens (it is insufficient to call them mere ‘televisions’ these days), with higher and higher resolution.  The displays are getting larger, thinner, lighter, and more affordable, and so, unsurprisingly, are becoming more and more common in ‘normal’ homes belonging to normal people.

It seems that average display sizes are growing by an inch or more per year – maybe it is common to see 50 – 60″ displays currently, and perhaps 10 years ago, 40 – 50″ were more normal, and 20 years ago (ie in mid 1990s) 30 – 40″, and if we go back 30 years to the mid 1980s, that was at the very onset of big-screen non CRT technologies, were television screens were in the 25 – 35″ range.

There’s every reason to expect the average screen size will continue to grow, and perhaps at an accelerating rate.

Quite apart from having more appealing/convenient form factors and lower prices, there’s a new technological enhancement that is potentially very significant – lower priced higher resolution technologies that are flowing all the way through the system from content creation (digital cameras) to content distribution (streaming and Blu-ray) to content display (the new large screen sets we’re discussing here).

The Reason 4K Will Become a Big Thing

Television set manufacturers – perhaps now better broadly termed video screen manufacturers – of course have to continue selling television sets/screens in order to remain in business and profitable.

For decades, their sales came from selling new sets to people buying a television for the first time, and then, as market penetration got close to maximum, their sales came from people buying a second and third television in addition to the first set in their homes.

Then, sales came from people upgrading to larger sets and to replacement sets, and then sales came from people upgrading to the first generations of semi-flat screen and digital sets.

The next big wave of sales came from people upgrading from standard NTSC type quality sets to semi-high definition sets to respond to the better image quality of DVDs, and then to people buying digital televisions when analog television was phased out, and then to people buying true HD screens – first 720p and 1080i, and now 1080p.

But then, the industry sort of plateaued, and manufacturers searched around for the ‘next big thing’ – the next reason for people to junk their older screens and buy new ones.  Now that 1080p resolution has become standard rather than esoterically expensive high-end, they can no longer sell that as a reason to upgrade, and so we saw the industry desperately turn to 3D as hopefully the ‘next big thing’.  It tried to push 3D for several years, but with very little success, and now it seems that manufacturers are coming to realize that they can’t persuade the viewing public that 3D is anything more than a gimmick and novelty.  Some manufacturers are now discontinuing the production of 3D sets entirely.

So, what can they promote next?  Enter 4K – sometimes called Ultra HD – as the new ‘big thing’ for the industry to use as a reason for us all to upgrade/replace our screens again.

This ‘4K’ resolution – an increase from the 1080×1920 pixel resolution of our current 1080p screens to a new resolution four times better – 2160 x 3840 pixels – is definitely proving to be the next new ‘must have’ feature on our screens, and unlike the nonsense gimmickry of 3D, is proving to have traction and acceptance in the market, and we expect that 4K will quickly move from esoteric high end to mainstream and must-have.

This has wide reaching implications.

At Home Video Quality Now Closely Comparable to Theater Quality

How good is 4K video?  To put the picture quality/resolution of 4K video into telling perspective, the next time you go to a movie theater, there is about a 70% probability you’re watching a digitally stored/projected movie rather than an ‘old fashioned’ movie that is stored on reels of 35mm filmstrip and shown through an ‘old fashioned’ projector.

These digital movies are, as you probably know from having seen them, every bit as good as movies projected the ‘old fashioned way’ via projector and indeed, sometimes can be a lot better.  These days they are usually shown at a resolution of 2160 x 4096 – a mere 7% more pixels than the consumer standard 2160 x 3840 (and these extra pixels are only useful when showing very widescreen movies with an aspect ratio greater than the 1.78:1 or 16:9 standard used by modern television).

In other words, most of the time, the consumer 4K standard and quality is essentially indistinguishable from the ‘professional’ movie screening standard.  Indeed, earlier digital movies in theaters were essentially the same resolution as we have in our 1080p sets at present (1080×2048), so we’ve progressed to a close to parity situation with movie theaters.

The new 4K technology is in the early stages of introduction.  A handful of 4K sets appeared at CES in 2013, but not only were they fantastically expensive ($50k and up), there were two other significant limitations – even if you did buy a 4K display, there was no content recorded in 4K format, and even if there was material recorded in 4K resolution, there was no way to get it to your screen.

Flash forward a year to now CES 2014 and both challenges are being addressed; indeed, 4K resolution content is now so close to reaching the mass market that Amazon has said its new video programming for 2014 will all be in 4K and Netflix is experimenting with streaming video in this new resolution.

Interestingly, although in theory, you’d expect that streaming video with four times as much pixel information in it as 1080p video would require four times the bandwidth to do so, in reality, with ever faster processors allowing for cleverer and cleverer compression algorithms, it is possible to get these higher quality video streams with less extra data bandwidth than you might think (typically little more than twice that required for current HD streaming).  Furthermore, as the internet continues to get better, bigger, and faster, what was unthinkable bandwidth just a few years ago is increasingly commonplace, so it seems likely that internet bandwidth issues may not be the crippling constraint they sometimes threaten to become.  We do however expect to see a need for 7GB and more of data per hour of 4K video streamed (ie a 15 Mbps data line speed as a minimum, and ideally able to peak over 20 Mbps so as to ‘catch up’ as and when the bandwidth occasionally dips below 15Mbps).

One related note about bandwidth.  The new ‘cleverer’ compression algorithms (in particular, H.265 HEVC) will also be able to be used on lower stream resolutions, so when we say that new 4K streams only require a little more than twice the bandwidth of a 1080p stream, we are referring to current compression algorithms on the 1080p stream.  In the future, the new H.265 HEVC algorithm will reduce the bandwidth required on a 1080p stream too, and then we will see close to a four fold extra data requirement between 1080p and 4K streams using the same encoding.

Prices Now Plunging on 4K Screens

We’ve had to make daily revisions to this section of the article, because each day has seen new products released at new lower price points at the huge annual Consumer Electronics Show currently being held in Vegas (CES).  Many of the high-end models that are being announced at CES have pricing details still vague (an enormous 105″ LG screen is thought to be listing for about $70,000).

But when we move down to more normal sizes, last year’s price premiums have already been resoundingly displaced – prior to CES – by closer to ‘normal’ pricing – you can now find 65″ screens, for example, at around the $4500 price point on Amazon, and 55″ screens for around $3000.  Indeed, Samsung says it expects 60 million 4K units to ship in 2017 – it isn’t clear if they mean 60 million a year, or 60 million in total, and just from their company, or from all companies, and worldwide or just in the US, but whatever the details, clearly 4K is expected to quickly move into the mainstream.

We next had a release at CES, where Asus announced a smaller 28″ 4K monitor that will list for only $800.  This is probably about as small a screen as could be justified for 4K video – smaller than that and the pixel density becomes ‘too high’ unless you are sitting with your nose pressed closely to the screen.

And then, low-priced brand Vizio, a company that has for years specialized in providing good quality screens at rock bottom pricing, announced a new line of 4K screens at amazing prices.  The smallest model, with an already large 50″ screen, lists for a mere $1000, a 55″ model is at $1400 – less than half the previous normal price for such sets, a 60″ for $1800, a 65″ for $2200 (again, about half the previous normal price) and a large 70″ for $2600.

Update (mere minutes after publishing this) :  I’ve just seen an online advertisement for a Seiki brand 55″ 4K monitor, for sale at Sears (of all unlikely places), at a bargain price of $799.

These prices are very close to those of comparable sized 1080p screens, making them a compelling alternative for most potential purchasers, and forcing a fast response from other screen manufacturers.  For that reason, we name January 2014 as the point when 4k screen resolution became mainstream rather than early adopter/esoteric.

Meanwhile, at the higher end, there are of course projectors as well as hard screens, with Sony announcing an interesting new projector that has a very wide-angle lens, allowing it to project a large image from a close distance – you’ll be able to have huge wall images even in a small-sized room.

Their 4K unit is rated for up to 147″ (on the diagonal) sized image projection, and is expected to be available shortly, with a list price slightly over $30,000.  That is still a great deal of money, but it is from a mainstream manufacturer (Sony) and it is also guaranteed that over the next year or two, we’ll see at least one zero knocked off the introductory high price, making for truly affordable truly ‘home cinema’ type experiences.  It is possible, as new larger screen sizes become the norm, that external projection systems like this will become a more affordable solution because they save you the cost of the large-sized physical unit.

What is the Maximum Picture Quality of a Movie?

There’s little point in scanning a movie at a resolution greater than it was originally filmed in.  So this is a relevant question, but while it is easy to ask, it is hard to answer.  Of course, we’ll try to give a sensible answer.

Assuming the movie is filmed with 35mm film, then probably each frame of the movie takes up a rectangle of 35mm film measuring about 0.87″ x 0.73″.  So, to a degree, answering this question boils down to understanding how many pixels are on a piece of film this size.

As a rule of thumb, it is reasonable to expect a resolution of about 5000 dpi from 35mm film.  But there are a lot of issues surrounding this number – maybe sometimes the resolution is lower than 1000 dpi, but sometimes maybe it is more like 10,000 dpi.  Factors that influence this include things such as the quality of the lenses when the original image was captured onto film, shutter speed, camera shake, picture noise, and then again when the film is being projected, plus how much quality loss has been suffered at each step of transferring the image from the original film through mastering and then duplicating, the quality of the film material used at each step of the process, and its age.

So you could argue the 5000 number up or down, but if we use that for a reasonable number for this exercise, we see that each frame of film contains about 3650 x 4350 dots of information.  These are not pixels as we understand it in a digital sense, because each of these pieces of information is more akin to a 24 bit dot with simultaneous red, green and blue information on it, but that’s a detail we can lightly skip over for now.

With new 4K technology offering 2160×3840 pixels, we’re getting close to the theoretical maximum quality of film, but this theoretical maximum is increasingly becoming theoretical only, because more and more movies are being filmed digitally rather than on to film to start with.  It is common to see 4K digital cameras being used, and some cameras in use have lower or even sometimes higher resolution.

Furthermore, even those movies which are still being filmed onto film are only being scanned at a 2K or 4K resolution prior to being digitally projected in theaters (and prior to being transferred to DVD/Blu-ray and streaming formats).

So what is the point of this?  Firstly, to point out that the theoretical maximum image quality of a piece of 35mm film is irrelevant – many other factors constrain the eventual quality of the image we see on the screen, and in most cases these days, the image has been digitized prior to screening anyway.  Perhaps the simplest and clearest point is simply to show that the former enormous and very clearly visible quality gap between home video (VHS tape with about 240 x 330 pixel equivalent resolution) and the highest quality in theater movies (2160 x 4096) has dwindled down to effectively nothing at all.

This is unsurprising when you consider that there is almost exactly 100 times more picture information/quality in a 4K image as there was in a VHS image.

But we also should point out that the latest high-end digital movie cameras are offering higher than 4K resolution – for example, the Red Dragon camera, which has 4K, and also 4.5K, 5K and 6K modes.  There’s no reason not to expect an increase in resolution in the cameras, even beyond 6K, so while it might be true that many older movies will never be able to be viewed at much more than 4K resolution, all new content could conceivable be created in ever higher resolutions.

In other words, while you might buy a 4K screen now, the chances are that in some years, it too will be obsoleted by some other higher resolution new screen.

Is 4K the Ultimate, or Yet Another Intermediate Point?

For an apparently mature technology, television/video broadcasting has been in a period of rapid and astonishing evolution.  We’ve gone from analog to digital signals, we’ve gone from standard definition to enhanced and improved definition, to various flavors of high definition (480p, 720p, 1080i, and most recently 1080p) and now there is a very clear move towards 4K as becoming the new specification for good quality imagery.

But does 4K represent the point of vanishing returns?  Is there any additional quality that can be experienced if the resolution is to be increased still further?

The answer to that is both yes and no.  There’s a limit to the amount of detail the human eye can distinguish, but as the resolution on a screen increases, what this means is not just showing more picture information, but it also means you can have a larger screen showing a bigger size picture without pixelation (ie the visible appearance of individual pieces and lines of picture information).

This is now the key focus on higher/highest resolutions – for a small set at a reasonable distance, there’s seldom any need to even go above a 720p resolution.  But with the cost per square inch and per pixel of large screen displays dropping all the time, higher resolutions translate to being able to sit closer to bigger screens and experiencing more of a ‘big screen’ movie experience at home.

Bigger Screens Add New Uses

This is a key point.  Don’t just extrapolate from present uses of your video screen.  Higher resolutions on large screens will also permit multiple simultaneous windows open concurrently – the same as we’ve come to expect on our computers (well, at least until the hideous Windows 8 ‘Metro’ interface).  You might recall earlier PIP – picture in picture – type capabilities dating back many years; but now we’ll increasingly see multiple windows open simultaneously on one large screen.

Why you’d actually want to have two, four, or more video windows all simultaneously showing different video simultaneously is a question that perhaps also needs to be asked, but with the further integration of computer and television, it is conceivable you could have windows up along the side of a main video window showing your email inbox, your texting inbox, maybe a tweet and Facebook page, and perhaps a few graphical displays showing realtime data such as weather, traffic, share prices, or whatever else you wished.

People are already showing a propensity towards juggling two screens simultaneously – ie watching something on one screen while doing other things on a computer, tablet or smartphone; conceivably these functions could all be integrated onto one big screen, and the concept of showing multiple data in a single window is well established – look at the news and stock tickers that roll along the bottom of most news programs these days, for example.  Breaking those out into separate windows is a logical and appropriate next step just as soon as we have screens large enough and display processors powerful enough.

So we don’t think 4K is a logical end point for the march towards more pixels, and neither do we think you’ll remain happy with whatever size ‘big’ screen you currently have in your living room (and all the other rooms in your home too).

So, and unsurprisingly, it seems that resolution will not stop at 4K.  Not only are there more and more 4K sets being released, some manufacturers are fancifully experimenting with even higher resolution screens – 2160 x 5120, as mentioned in this article (and also now a very similar same sized screen has been announced by Samsung, too), and some screens are appearing at a much higher resolution.

Confirming this is further news from CES reporting on the appearance of a limited number of screens boasting a stunning 8K resolution.  While these are currently bearing six figure price tags, it seems inevitable that by the time that 4K has become the new standard, there will be more affordable 8K screens appearing in greater numbers, and who knows what will follow 8K and how quickly it too will be obsoleted.

Bigger Higher Resolution Screens are Inevitable

Our point here is two-fold.  First, yes, we will see a continued trend towards higher and higher pixel counts on bigger and bigger screens.  But, secondly, we predict that screens will become more multi-functional and will start to offer up the ability to show multiple windows of information simultaneously, just like we do without thinking at present on our computers.

The ‘need’ for bigger screens and more pixels will be driven more by the ability to have multiple video windows open simultaneously rather than by the diminishing benefits of showing a single video feed in ever larger size and ever higher resolution.

Where will it end?  Ultimately, it would seem logical to assume that our walls will become almost fully covered in video paneling, apart from windows (or will high res video screens replace ‘energy inefficient’ windows?) and areas blocked by furniture, and the resolution will increase to a point where you can stand close to the wall and still see high quality imagery.

Update – several hours after publishing, I came across this article which seems to suggest Sony is pursuing the vision mentioned in the previous paragraph.

Current big screen displays have a pixel density of about 40 pixels per inch (ppi).  Your computer screen probably has 75 – 100 ppi, your tablet 250 ppi and your smartphone may have 300 – 350 ppi.  So there’s an enormous opportunity to add extra pixel density to big screen displays.

The New Choice :  Theater or Home Movies

So, let’s now return back to the threat of new consumer video to traditional movie theaters.  The remaining things that movie theaters offer compared to a ‘home theater’ are outrageously priced drinks and popcorn, super surround sound, and the ‘big screen’ picture.

For sure, they have increasingly lost out on convenience – now that we don’t even have to make a trip to Blockbuster (RIP) to borrow a movie but can instead select a movie for instant and probably free download, the convenience factor has swung overwhelmingly to at-home video.  The best that theaters can do to respond to this is to weakly claim that going out to watch a movie is a ‘special experience’, but exactly how special is it?

Most of us will probably willingly forego paying $5 – $10 each for a soda and popcorn that we could enjoy at home for $1 – $2, and with the latest 7.1 or even 7.2 channel surround sound available when watching movies at home, the sound issue is no longer something that theaters can beat us on.  The only remaining feature has been, until now, the ‘big screen’ experience – having a huge big screen in front of us, with a high quality picture displayed on it.

How Unique is the Remaining Big Screen Experience Offered by Movie Theaters?

A ‘big screen’ experience has not really been possible at home, prior to now.  It was never possible with standard definition television.  We had to sit a long way away from it so as to have the otherwise visible lines of picture blur into each other to create the semblance of a smooth image – the bigger the screen, the further away from it we had to sit, effectively reducing its perceived size.

To put things in contrast, a VHS tape has maybe 240 lines of resolution, a DVD usually 480 lines of resolution, compared to the 1080 ‘lines’ on our current screens and the possibly 2160 lines on a movie theater screen.

So when we switched to 1080p screens, we could sit much closer to the screen and still not see the individual pixels, which meant the perceived size of the screen – the amount of our field of vision it occupied, could increase.

Not everyone has realized that, and while most people have replaced older standard resolution televisions with new higher resolution screens that are somewhat larger, they haven’t changed how close the screen is to their seating.  In round figures, you can sit three times closer to a new 1080p screen than you could to an earlier traditional television, which makes the size of the screen in front of you that much bigger and now approaching the same perceived size as a movie theater screen.

Opinions differ a bit on how close you should sit to a modern screen, but a good rule of thumb seems to be ‘divide the screen diagonal size in inches by ten, and call the answer feet then increase that by a third or so.  So if you have a 55″ screen, that works out to sitting 7 – 7.5 feet away.  Some calculations suggest adding a bit more distance to this result, so consider this rule of thumb a close to minimum distance.

Go to the new 4K resolution, and you can either double the size of the screen (and still sit the same distance away) or sit twice as close (the cheaper option!).  So with that same 55″ screen, you could now be less than four feet away, and see a perfect picture with no pixels or lines or anything visible.  Try sitting that proportionally close to your current screen to get a feeling for the ‘big screen’ effect you’d get, and you’ll realize it is every bit as big as in the movie theater – as of course it should and could be, when you and the theater are using the same resolution images.

Our point is this.  Until this latest generation of video capabilities in consumer level electronics, movie theaters still had (at least in theory) appreciably better picture technology which could give a much better immersive experience to their patrons.  The new 4K technology gives us the same technology for home, and as we now enjoy the typical collapse in pricing of each new electronic innovation as it progresses from ‘early adopter’ pricing to mass market pricing, it will become more and more affordable and eventually will become the standard for all new screens, and with lower costs and lighter/thinner screens, it becomes easier to mount a huge sized screen in everyone’s living room (and bedroom and kitchen and most other places too).

Add to that the ability to stream video to your screen without having to spend a single extra penny, and your future choice when wanting to watch a movie will become :

(a)  Turn on the screen at home, choose from thousands of movies, and start watching; pause it halfway through for a bathroom or food break, check your texts/emails during the boring bits, all in your dressing gown at home and at no additional cost over your monthly fees.

(b)  Drive car 5 – 10 miles, park car, walk to theater, buy movie tickets, maybe buy food/drink, wait for movie screening time, turn off your phone, then at advertised screening time, watch 10 – 15 minutes of trailers and commercials, finally watch movie, walk back to parked car (oh yes, it is raining/snowing/jammed traffic….), drive home, maybe pay babysitter – for two people, a $50+ cost, and an extra time cost of an hour or more over and above the less than two hour movie itself.

Which do you think people will increasingly choose?

How Can the Movie Theaters Respond?

And the really big problem for movie theaters?  There’s no way they can viably respond to this – well, sure, they could stop wasting 15+ minutes of our time forcing us to watch stuff we don’t want to see before showing us the movie we paid to see, they could halve the price of admission and reduce the cost of food and drink four-fold, but that ‘cure’ would destroy their profitability.

Alternatively, they could make the movie experience more ‘special’.  One approach is to offer an Imax type experience, with an even bigger screen, and better picture and sound quality.  But that’s an expensive undertaking/investment for the theater, there are only a limited number of movies available in Imax format, and it drives up the cost of the event for the theater goers, thereby marginalizing the market size and accelerating the move to at-home high quality video experiences.

Some theaters have tried a different route, showing ‘normal’ films but in a special environment.  They offer Lazyboy type recliner seating in pairs with gaps between each pair of seats, and add at seat-service for reasonably high-end food items and alcoholic beverages.  This does create a special and enjoyable night out, but is much more expensive than an ‘ordinary’ movie visit (I’ve never been able to do this without paying $100 or more to the theater for me and a friend, plus all the additional related costs of going out for a night).

Will movie theaters follow bowling alleys into irrelevance and become merely a marginal footnote to our normal lives?  A curiosity rather than a key part of our social fabric?  The answer seems to increasingly and unavoidably be yes.

6 thoughts on “Will Home Video Finally Cause the Demise of the Movie Theater?”

  1. David, We got one of these before Christmas – a 55 inch, made by THC (this company owns RCA) for $750 from Amazon. Other than the cost of a mounting bracket (also an Amazon “deal”) and a wall mounted shelf (yet another Amazon “deal”), the only unexpected cost was to upgrade the remote control device since the original remote did not have the code for the THC units. The picture quality is excellent.

  2. An amazingly comprehensive analysis. Bravo.

    I can’t remember the last film I watched at a cinema. But I need to explain that. I can’t remember the film, but I remember very well the visit to the cinema itself, complete with recliners, wine and excellent nibblies. I remember that — the environment, the “event” — but not the film because my local indie cinema sells an evening out, and I find it enjoyable. Yes, it’s expensive, but not much more so than a visit to a good pub. In other words, the cinema in question, along with some others, has repositioned itself in the leisure & entertainment industry and is no longer competing with big multi-screen chains. Even some of them are starting to adapt. An Odeon near me recently relaunched as an Imax theater. I’m not interested, but probably others are. Which represents the future? Hard to say, and probably there will be other formats still to be tried. But I suspect the large auditoriums we call movie theaters will survive in some form, because there are still quite a lot of good reasons NOT to sit at home on a couch watching even a huge screen every evening.

  3. I at age 65, haven’t been to a movie for the past 5 years, but until a week ago, I got the bug again. I don’t have a huge screen (only a 24 inch) but plan on getting a 50″ soon, along with a sound bar so I can enjoy Julia Roberts “in my lap”.

    A few miles away is a large multiplex cinema which now offers half price Tuesdays. Along with a membership card, they offer 10 movies and you get one free, along with 20% off on snacks. This makes movie going more affordable. It will have to be a huge epic film before I shell out $12 + tax for a ticket. Parking, mercifully, is free.

    To me, 4K sounds great, but I’m not willing to wait until they come down in price. I’m looking for a 50″ Plasma smart TV and have seen them available locally in Vancouver B.C. for $725 + tax. Am waiting for a better sale price, but Boxing Week sales produced almost nothing.

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