Does quality impact the business model? Case: Digital Cinema

The media scene has endured continuous changes ever since we saw the light of the motion picture in 1888 into our present digital age. The changes, innovations and expansions have generated a significant media value chain constituting a vast worldwide economy. The D-cinema business is about creating a digital media asset (the film, the feature or motion picture) and screening this on as many screens as possible. Hence enabling the studios, owning the asset, optimizing their profit and making sure the exhibitors sell more tickets. For more than 100 years this has been managed by a value chain consisting of the studios, the distributors and the exhibitors (cinema owners). Digitization has the potential of dramatically changing the industry and opens for new business models driven by the innovation and governed by change and the handling of change. This paper explores the innovation driven change in the cinema business going digital and assesses the impact quality has on the roll out and the underlying business model.