Conversion conversations: Demetri Kouvalis, owner of the Patio Theater

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The historic Patio Theater edifice (photo courtesy the theaters website)
  • The historic Patio Theater edifice
Last week I posted an interview with Music Box Theatre head projectionist Doug McLaren about DCP, or digital cinema package, which is rapidly replacing 35-millimeter film in this country as the primary form of movie exhibition. To get another perspective on the issue, I spoke with Demetri Kouvalis, who reopened the historic Patio Theater last year and is currently upgrading the cinema to accommodate DCP. Kouvalis managed to raise most of the necessary funds through Kickstarter, though he still has a fair amount left to do. He explained to me some of the work involved with converting a theater to digital projection and why he prefers to do this without the assistance of Hollywood studios, as many other theater owners have. Our conversation follows.

Ben Sachs: Now that you've raised the money to buy a DCP unit, do you plan to abandon your 35-millimeter projectors?

Demetri Kouvalis: No. I'm keeping my 35-millimeter projectors on top of adding a digital projector, since I have space for both.

What prompted you to invest in the new system?

Well, Hollywood isn't very merciful when it comes to theaters projecting from film. If I want to continue showing new Hollywood films, I have to upgrade to this new format. I don't really have a choice. And since I didn't want [the Patio] to purely show older films on 35-millimeter, I had to have both [projection] options.

On top of that, with a digital projector you have opportunities to show many more things. You can play whatever movie you want, basically. So you can accommodate private parties, school outings, company outings ... It opens new areas of business for us in that way. Also, most film festivals in Chicago—and all around the midwest—are using digital formats because it's so much easier and cheaper to use. So if we ever wanted to be part of a film festival—or start our own festival, even—we would need digital [projectors].

But since you're keeping your film projector, do you have plans to screen older movies from 35-millimeter?

Of course! Since we spent so much money last year when we reopened the theater getting the best 35-millimeter projectors in the city, we're not just going to throw them away or let them gather dust. Those projectors are here to show older films, if we decide to do that. Or if an institution devoted to screening older films—like the Northwest Chicago Film Society—wanted to come over to the Patio, we would be capable of accommodating them. We want to leave that option open.

We try to set aside one weekend a month where we show an older movie from 35-millimeter. We've had The Blues Brothers, Back to the Future, and things like that. I'm trying to book The Princess Bride for later this month or sometime in September. Once we get the digital projector and I can start scheduling [movies] in both formats, I'm going to create a booklet for each season that lets people know what movies will be playing and in which format. Until then, I'm working with people to install the projector and print up the schedule. It's a rough time, getting everything organized.

Tell me a bit about the Kickstarter campaign you started to raise money for the DCP conversion.

We started it at the beginning of June and ended at the end of July. The goal was to raise $50,000, and we raised that amount seven days ahead of schedule. That amount covers most of the upgrade, but not all. I didn't want to ask for $75,000 [the full cost of a DCP projection system] and then not be able to raise it. I chose a number that I believed would be attainable. With that, I'm going to try get the unit installed in the near future.

When do you think that will be?

I would love to have it done in September, but I'm still talking to leasing agents and banks for financing options [on the remainder of the cost]. I'm looking at three or four bids from different contractors who sell and install the projectors. It's a long and tedious process. And once I find someone who offers a good price, I would have to accommodate their schedule, and most of these people are very busy right now. So I don't foresee us getting a digital projector until October or November, but it will definitely be before the end of the year.

Are the people who lease the projector to you also the ones who install it?

Since I have most of the money to cover the cost of the unit—probably about 80 percent of the funds—I only need to borrow a relatively small amount of money from a bank or another financial institution. So I'm going to pay the people who install the projector up front and then owe the remainder to the lender, just like I would with any loan.

I understand that the studios are so eager to get every theater converted to DCP that they've actually set up leasing plans for theater owners making the conversion.

That's true, and for most theaters it's fine. The program is called VPF—Virtual Print Fee—and it works with multiplexes or theaters with four or more screens. But for a single-screen theater like the Patio, it poses a problem. The studios are essentially giving you money to have this projector. They're like, "Thank you for upgrading to this new format; here's some money every month to cover the cost."

Now the problem is, once they give you money, they have a hand in the pot. They start controlling what you show. They start coming up with rules, like, "We want you to show this movie for two weeks instead of one week [like you had planned] or for 16 shows instead of 13 shows." A multiplex has so many screens that they would hold those movies for a longer time anyway; none of this bothers them whatsoever. But for a single-screen theater, it's really difficult to do that. And that [plan] really ruins the creative freedom that the owners have.

Some things about VPF look really enticing, but other things about it hinder what I'd want to do with a theater. I want to be the 100 percent owner of a digital projector, but that wouldn't happen for at least five years under that type of program. So I'd much rather pay up front with the money I've been able to raise—with the help of the community and a bank—and own the property outright. I don't want to worry about other people telling me what to play and how many times to play it.

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