The head of Canada’s largest chain of movie theatres is joining other media companies in calling for changes to digital copyright and licensing laws.

CINEPLEX CEO ELLIS JACOB said Canada needs new digital laws to protect entertainment industry jobs as it continues to struggle with pirated movies downloaded over the internet.

Most jobs in the movie industry aren’t filled by celebrities but by every day people such as theatre staff, he noted.

“They depend heavily on the incomes they make from what they do in Hollywood or what they do in Canada and I think it’s important that those jobs be preserved,” Mr. Jacob said in an interview after the company’s annual shareholder meeting Wednesday.

“Piracy is very very unfavourable to our business and the government was very sensitive initially when movies were being pirated out of theatres and they changed the law to make it a criminal offence.”

Mr. Jacob stated that the government’s first step should be learning about the challenges the industry faces before it drafts any potential laws.

The CINEPLEX CEO is the latest to express concern over the country’s current internet regulations, which others have complained allow movie providers like NETFLIX to escape obligations faced by telecoms and broadcasters in Canada.

Last month CORUS ENTERTAINMENT, ROGERS COMMUNICATIONS and ASTRAL MEDIA – among others – said they wanted Canada’s telecom regulator to examine the operations of internet based services like NETFLIX.

The 40 member group from the telecommunications, broadcasting, cable and satellite and production sectors has asked the CRTC to initiate public consultations on the industry.

They say overall funding for Canadian content will be reduced as viewers bypass distributors which pay a percentage of their revenues for creation of Canadian content and head straight to places like NETFLIX.

Companies like NETFLIX are currently exempt from rules that require distributors and broadcasters to fund Canadian content and programming. It has argued it should be exempt because it is a distributor, not a producer of content.

In addition to concerns over Canadian content fees, Canadian copyright and trademark laws have been criticized internationally for failing to address intellectual property crime. The music industry has long complained that illicit copying and downloading has killed record company jobs and robbed artists of income.

Last June, the federal government introduced new copyright legislation that would allow companies to sue consumers for damages of betwen $100 and $5,000 for breaking software that prevents copying of music or movies.

The bill was scrapped when Parliament dissolved ahead of this months’ federal election, but the election of a Conservative majority has paved the way for copyright legislation to find a clear path to royal assent.

ELLIS JACOB feels that digital technology is becoming a bigger part of CINEPLEX’S future. The company currently owns conventional and mobile websites that allow customers to check movie times but also stream and download movies.

Mr. Jacob said CINEPLEX will be evolving its website as cloud technology becomes available in the next six to eight months, though he didn’t get into many specifics on what future features might be included.

“Once you’ve got a digital locker where you can actually store the movie — other than in your computer — I think it’s going to change things for everybody because then you can digitally access the movies on whatever device you have,” he commented, mentioning computers, televisions and mobile phones.

A study published Tuesday indicates that Canadians have a growing appetite for the convenience of digital movie downloads.

The study, published by Sandvine Corporation, said NETFLIX movies and TV shows account for nearly 30 per cent of traffic into homes during peak evening hours.

NETFLIX, which originally competed with video rental stores by mailing out copies, has seen its downloadable movie service grow rapidly since coming to Canada.

The rental video business in Canada — including retail stores, mail order services and digital offerings, but not TV video on demand products — totalled about $970 million in 2010, down 12 per cent from the previous year, saids Toronto based Convergence Consulting Group.

Movie theatre exhibitors such as CINEPLEX have responded by supplementing their traditional theatres with technology to show big screen or three dimensional movies, chairs that move along with explosions in action scenes and alcoholic beverage services in addition to legal online movie downloads.

Mr. Jacob said that CINEPLEX will also expand upon some of its diversified businesses — which include an in house magazine and loyalty program — offering more alternative film options such as South Asian movies and big screen opera, ballet and wrestling productions.

The company is also planning on expanding its number of UltraAVX theatres this year, which charge a premium ticket price for wall to wall screens, more comfortable chairs and reserved seating.

CINEPLEX GALAXY converted from an income fund to a corporation in January and operates CINEPLEX ENTERTAINMENT, which runs 131 theatres from British Columbia to Quebec with about 1,352 screens that include digital projectors, Imax screens and its UltraAVX screen and sound systems.

In an earnings reported earlier this week, CINEPLEX stated that it lost $800,000 in the first three months in the year because of lacklustre Hollywood movies that didn’t provide a runaway blockbuster.

The company has about 10,000 employees (give or take) under its numerous brands which include Cineplex Odeon, Galaxy, Famous Players, Colossus, SilverCity and Scotiabank theatres

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