Abstracted from the weekly edition of Screen International
Russian distributor Paradise Productions is set to become the country's leading exhibitor when it opens its new $3.7m, five-screen multiplex in central Moscow this autumn.
Taken together with a single-screen cinema opened in Vyborg last week and two more complexes opening soon in the Moscow suburbs and in the Urals, the new $3.7m entertainment complex will take to 13 the number of screens operated by Paradise. That may be a drop in the ocean in more developed territories, but it is big in under-screened Russia, where the number of commercially viable screens is currently a little more than 100.
"It is just the beginning. We are on the threshold of the birth of the Russian film industry," says Paradise founder and president Gevorg Nersisyan, adding that the difficulties of getting quality screen time for his own company's releases was what prompted his entry into exhibition.
Out of a total of 300 films released in Russia last year, most of them had only one show a day in single-screen cinemas for a run of not more than a week. "You cannot give a film a chance if you don't have enough screens," said Nersisyan. "Our strategy is to develop only multi-screen projects. That is the future for exhibition in Russia."
Paradise, which as a distributor concentrates on quality independent product, has distributed three out of the last five Woody Allen films and is set to release Gangs Of New York in Russia. It also released a dozen local films last year and plans to reserve one screen at the new five-screen complex exclusively for local productions.
The improving Russian economy and steady gains at the Russian box office over the past two years has also prompted the development of other domestic exhibition chains. Both Karo Film, which operates two four-screen complexes in Moscow shopping centres as well as its flagship Pushkin Cinema, and Cinema Empire, which operates about 10 screens, plan further expansion.
But, according to Nersisyan, exhibition may not see the massive development it needs until major foreign players enter the market. The large-scale investment needed for the screening of Russia is beyond the reach of most local companies. But this is a chicken-and-egg situation.
The currently modest box-office numbers may be keeping the international players away. But the rate of growth for the fledgling exhibition sector is impressive. Last year the Russian box office totalled $50m from about 80 screens. By the end of 2002, according to Eugene Gindliss a producer at NTV Profit, the box office is expected to grow to $100m with about 150 screens.
Another factor holding back development is the cost of licensing, which is said to be increasing more rapidly than the size of the Russian box office. "This is short-sighted," says Nersisyan. "We need to attract investment and steep price increases will spoil the dynamics of the development of the Russian market."
But increasing prices for foreign product may prove a windfall for the struggling Russian production sector. Paradise now plans to invest in production as an alternative to acquiring expensive foreign productions.