Hollywood startup aims to give theaters an avatar experience

CULVER CITY, CALIF. — It is easily Hollywood’s hottest startup.

Steven Spielberg was an early investor. So were 21st Century Fox, Metro-Goldwyn-Mayer and Warner Bros. The venture’s leadership team includes the former chief of Disney’s theme park design division; the producer of the “Men in Black” movie series; and a live event kingpin.

And now AMC Entertainment, the world’s largest theater chain, has invested $20 million in the fledgling company and agreed to finance the rapid rollout of its product in the United States and Britain.

The fuss is over Dreamscape Immersive, which has been working in a warehouse here for the last year and a half on what it calls a “virtual-reality multiplex.” Instead of a variety of movies, Dreamscape Immersive locations will offer a variety of virtual-reality experiences. Its technology, developed by a Swiss motion-capture firm, allows up to six people to explore a virtual-reality environment at once, seeing fully rendered avatars of one another.

“We were mesmerized by what we saw,” said Adam Aron, chief executive of AMC Entertainment. “Their vision is to change what VR has been — away from just a heightened level of video game and toward cinematic storytelling — and we think it’s what consumers have been waiting for.”

The AMC deal, which brings total investment in Dreamscape to more than $40 million, calls for up to six Dreamscape locations to open over the next 18 months. Some will be inside existing AMC theaters, and some will be stand-alone centers nearby. Additionally, Dreamscape will open a flagship location in the first quarter of next year at the Westfield Century City mall in Los Angeles. Westfield is another Dreamscape investor.

“In many cases, we have surplus space, and we think Dreamscape will add energy and excitement to our theaters, especially during the week,” Aron said. “But this isn’t a replacement for movies. It’s a complement.” Tickets are expected to cost from $15 to $20.

Dreamscape joins a cluster of companies that are trying to take advantage of the still-untapped consumer promise of virtual-reality technology, the desperate need by shopping malls to reinvent themselves in the online retail age and the pressure on movie studios (and theater companies) to find new avenues of growth.

The Void, a Utah startup, recently announced a partnership with the Walt Disney Co. to open “Star Wars”themed virtual-reality experiences at Disney malls outside theme parks in California and Florida.

Already operating are two Imax VR Centres in Los Angeles and New York; tickets start at $7, and the Los Angeles location has attracted 50,000 people over the past nine months. Imax said it planned to expand the concept to Canada, Britain and Shanghai this fall.

The Hollywood players behind Dreamscape give it immediate cachet. Joining Spielberg are people like Hans Zimmer, the movie music composer, and the director Gore Verbinski. But their involvement does not guarantee success. Spielberg, for one, has been down this road before, with mixed results. In the late 1990s, his DreamWorks SKG invested alongside Universal Pictures in a heavily promoted venture called GameWorks, which was supposed to use new technology to revolutionize the arcade business. GameWorks never lived up to its billing.

Around the same time, Disney encountered similar disappointment with DisneyQuest, which was envisioned as a worldwide chain offering virtual-reality experiences. Only two were built.