Digipix managing director Steve Quartly has designed software to make 3D cinema advertisements. Photo: Chalpat Sonti
Cinema advertising has been much like movie-going during the advent of home theatre systems - little interest and falling revenue.
But that could soon change, thanks to an ambitious plan by two Perth-based companies at the forefront of a technological revolution in the way ads are shown at movies.
As the countdown to blockbuster director James Cameron's much-hyped comeback movie Avatar has a month to go, moviegoers at its WA and South Australian screenings will notice something unusual before the 3D film starts.
Cineads managing director Wes Stansfield. Photo: Chalpat Sonti
The film will mark the official debut of 3D advertising in Australia, thanks to technology developed by Digipix, the brainchild of Perth man Steve Quartly.
But it also marks another step in the attempt by Digipix and its half-owner Cineads to expand the reach of their technology.
The next move will be a presentation by Mr Quartly and Cineads staff to a trade conference in Sydney next week.
Apart from cashing in on the explosion of interest in 3D movies worldwide, they hope to find foreign interest in what they are doing.
And that exposes an unusual situation in Australia.
Cineads, started in Perth by former employees of rival cinema advertising company Val Morgan, focuses on the small-to-medium business segment of the advertising market, while Val Morgan concentrates on national advertising campaigns.
However, Val Morgan has the advertising rights to virtually all the movie screens interstate.
But with Digipix having designed the 3D advertising technology, it will for now be shown on screens in WA and South Australia, where Cineads has deals with cinema operators.
Interestingly, one of those deals is with major player Hoyts in the two states. Hoyts and Val Morgan are owned by Pacific Equity Partners.
It is a delicate situation, made more intriguing by a decision by Hoyts about two years ago to take its WA advertising rights off Cineads and give them back to Val Morgan.
That decision - made amongst debate about Cineads only being effectively allowed to show still-frame ads, while Val Morgan could screen moving pictures - has since been reversed.
But with that behind Cineads, managing director Wes Stansfield is bullish on the potential of 3D advertising, with the number of screens catering for the technology set to explode.
WA leads the way - as it did with digital cinema - with about 25 screens from Warwick to Bunbury, including 11 in theatres of independent operators Ace and Grand Cinemas. By contrast, there are just a handful in total in independent cinemas interstate.
And it is Cineads' bread and butter - small business - where Mr Stansfield believes huge growth in advertising will come from.
"We can now make a commercial for about $5000, depending on the amount of (computer-generated imagery)," Mr Stansfield said.
"Compare that with a TV ad, which costs about $30,000, and you can see we're making it cost effective.
"With us, you don't have to spend $100,000 to make one of these ads."
Cineads has already signed the likes of big-hitting "small" local businesses to advertise during Avatar, including Barbagallo Group, Rick Hart and Ross North Homes.
WIth more and more 3D flicks set to hit the screens in the wake of Avatar - including Tim Burton's Alice In Wonderland and Shrek Forever After - Cineads hoped 3D advertising would make up at least 40 per cent of its revenue next year. The company has an annual turnover of about $5 million at present.
3D advertising was one of the fastest growing mediums in the US and UK - where there was virtually no small business cinema advertising - and there was no reason it could not provide a big boost to the Australian market, Mr Stansfield said.
The industry turned over about $100 million a year at one time but Val Morgan, with more than 90 per cent market share, now has revenues of about half that.
"(Industry turnover) could easily go to $200 million. I mean $50 million is the advertising campaign budget of just one big company in Australia. People going to 3D movies are spending about three times more than those going to 2D," Mr Stansfield said.
Recently-screened horror film My Bloody Valentine had taken in 7.9 times more on 3D screens than on normal screens.
Figures from ratings agency Nielsen show the animated film Up generated $122,861 average revenue on 3D screens, compared to $43,213 on normal screens.
Larger Australian companies had shown interest in the advertising, and Cineads was "exploring options", Mr Stansfield said.
The next task was to get advertising agencies familiar with the technology so they could design campaigns around it. At present, ads go from drawing board to screen at Digipix.
And with the novelty of the "new" 3D - a far cry from the coloured glasses of the past - sure to remain with audiences for years yet, Cineads can realistically offer advertisers a captive audience.
"What we've found (during test screenings to industry) is that no one takes the glasses off - they just want to know what's going to happen next," Mr Stansfield said.
