IMAX: THE MAN BE­HIND THE LIV­ING SCREEN

Ev­ery child re­mem­bers their first IMAX ex­pe­ri­ence but see­ing their favourite cin­e­matic thrillers on an IMAX screen is a plea­sure that doesn't di­min­ish as we age.

Qatar Today - - INSIDE THIS ISSUE - BY SINDHU NAIR

IMAX's core phi­los­o­phy is to en­sure that the qual­ity of the con­sumer ex­pe­ri­ence is sec­ond to none and as such, our re­search and de­vel­op­ment in­vest­ments con­tinue to fo­cus on im­prov­ing qual­ity ver­sus driv­ing lower costs.”

IMAX has just opened its sec­ond the­atre in the mar­ket and they are cur­rently plan­ning to add a third at the Mall of Qatar in 2016 which will ac­com­mo­date over 600 pa­trons.

“Once that opens, we will eval­u­ate the mar­ket de­mand based on box of­fice re­sults and look to add ad­di­tional the­atres in con­junc­tion with our part­ners,” says Richard Gel­fond, CEO, IMAX Cor­po­ra­tion in an ex­clu­sive email in­ter­view with Qatar To­day.

Gel­fond goes back in time to bring back his ex­pe­ri­ence in this en­ter­prise that has amazed cin­ema­go­ers.

“When I came to IMAX, in 1994, I had been an en­tre­pre­neur, a lawyer, and an in­vest­ment banker. I didn't know much about the movie business, but I recog­nised that the movie-go­ing ex­pe­ri­ence IMAX of­fered had great po­ten­tial if we could find the right way to grow,” he says.

But it has not been an easy jour­ney with a prod­uct that is far re­moved from the con­ven­tional cin­ema.

As he ex­plains in de­tail in Har­vard Business Re­view, “most IMAX movies were na­ture doc­u­men­taries shown in the the­atres of sci­ence mu­se­ums, and fig­ur­ing out how to move into main­stream mar­kets proved much more dif­fi­cult than we'd ex­pected. That was due in part to the tech­nol­ogy

con­straints of the predig­i­tal era; it took years to find ways to make it easy and cost-ef­fec­tive to show IMAX movies in a large num­ber of mul­ti­plexes.”

First step

Soon after Gel­fond and a friend ac­quired the company, it was made pub­lic, which too came with ben­e­fits of liq­uid funds but had other con­straints. “Gen­er­ally it was a good decision be­cause it gave us ac­cess to cap­i­tal and pro­vided the dis­ci­pline to prof­itabil­ity,” he says. “On the other hand the dif­fi­culty is that a business that could be best run by fo­cus­ing on long-term ob­jec­tives and pub­lic mar­kets of­ten forces you to pay at­ten­tion to short-term bench­marks.”

But though tough, IMAX cracked the business by “con­stant in­no­va­tion” and “adapt­ing our strat­egy to fit the Hol­ly­wood way of do­ing business” and Gel­fond re­veals the lat­est suc­cess fig­ures of this in­no­va­tion.

“The de­mand for IMAX glob­ally has never been stronger with over 100 new sign­ings for screens so far this year. We al­ready op­er­ate 880 IMAX the­atres in 60 coun­tries across the globe, and our most re­cent quar­ter gen­er­ated $169 mil­lion (QR620 mil­lion) in global box of­fice – a 28% in­crease over the pre­vi­ous year. We have been de­lighted by the suc­cess of our in­ter­na­tional growth strat­egy which we are con­tin­u­ing to de­liver. This has seen rev­enues out­pace the US do­mes­tic box of­fice for IMAX in ev­ery quar­ter since 2013,” he says.

Fu­ture plans

Gel­fond has a strat­egy in place for the fu­ture with “IMAX con­tin­u­ing to ex­e­cute our in­ter­na­tional growth plans and look­ing to se­cure a greater foot­print in un­der-pen­e­trated mar­kets in the Mid­dle East. We must en­sure that we in­no­vate and adapt to suit the de­mand and shifts in the in­dus­try,” he says.

In an era where nano tech­nol­ogy is gain­ing pop­u­lar­ity, will the “big is bet­ter” screen of IMAX and its live im­agery be the fu­ture of tech­no­log­i­cal in­no­va­tions? Gel­fond is con­fi­dent that the dig­i­tal ad­vance­ments in en­ter­tain­ment have trans­formed the way in which we con­sume en­ter­tain­ment. “The cin­e­matic ex­pe­ri­ence must now su­per­sede the at-home of­fer­ing in or­der to at­tract con­sumers. IMAX's im­mer­sive cin­e­matic ex­pe­ri­ence of­fers some­thing con­sumers can­not cre­ate at home and we are con­fi­dent that we can con­tinue to de­liver, with com­pelling con­tent and state-of-the-art tech­nol­ogy,” he says.

The Mid­dle East mar­ket is the big bet for Gel­fond and his team. He says, “We are plan­ning to dou­ble the IMAX foot­print in the re­gion from 15 to 30 out­lets by 2017. We have been ex­pand­ing cau­tiously in this area since the turn of the cen­tury, grow­ing from two IMAX out­lets to 15 to­day. Al­ready we are set to open out­lets in Bahrain and our sec­ond the­atre in Egypt in 2015. The Mid­dle East is rel­a­tively un­der-pen­e­trated com­pared to other mar­kets and we are ex­cited to har­ness this op­por­tu­nity.”

Pay for qual­ity ex­pe­ri­ence

But does a pre­mium cost jus­tify an IMAX ex­pe­ri­ence, we ask the man be­hind the brand and he says: “IMAX's core phi­los­o­phy is to en­sure that the qual­ity of the con­sumer ex­pe­ri­ence is sec­ond to none and as such, our re­search and de­vel­op­ment in­vest­ments con­tinue to fo­cus on im­prov­ing qual­ity ver­sus driv­ing lower costs. Our ex­pe­ri­ence over the past decade in­di­cates to us that con­sumers are will­ing to pay a pre­mium for a qual­ity ex­pe­ri­ence that they can­not ex­pe­ri­ence any­where else.”

But IMAX went through some of its tough­est pe­ri­ods after it had ad­justed the business model to cater to the re­quire­ment of Hol­ly­wood movies and the­atre own­ers. “In the early 2000s most of the ma­jor the­atre chains in Amer­ica (and many around the world) filed for bank­ruptcy, and we were left with big re­ceiv­ables we couldn't col­lect. IMAX still car­ried a lot of debt as a re­sult of the 1994 LBO, and some­times we doubted whether we would earn enough to meet those obli­ga­tions,” he says.

And it is then that Gen­fond learnt some im­por­tant life lessons. “I've learned that fail­ure is life's great­est teach­ing les­son. I've had to learn the hard way my­self, whether over­com­ing un­fore­seen ob­sta­cles, man­ag­ing an or­gan­i­sa­tion in a down­beat mind set or repo­si­tion­ing and re­defin­ing mod­els that didn't work. Fail­ure helps you find in­ner strength. It also helps you ap­pre­ci­ate suc­cess and un­der­stand its fragility.” And then came the turn­ing point in the form of Avatar. “The mo­ment I knew we'd make it came in when Avatar opened. The IMAX ver­sion was a global phe­nom­e­non. In China there were six-hour lines to get in, and scalpers were charg­ing $100 (QR364) a ticket. Avatar did $250 mil­lion (QR910 mil­lion) glob­ally on IMAX screens; be­cause we shared in that rev­enue, it was a fi­nan­cial turn­ing point for us,” he says

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