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Real Image/Technicolor

The march of Digital Cinema continues.  Jim Mendrala, participate in the TIG, is a
member of the technical staff of Real Image.  See below for the announcement of
buy-in by Technicolor.

Regards, Bill Hogan  Sprocket Digital
(usual disclaimer--no interest in companies involved)

Technicolor projects digital Real Image
Company takes 49% stake

By ADAM DAWTREY,  August 6, 1999

Looking to secure a place for itself in the coming era of digital
exhibition, film processing giant Technicolor has acquired a 49% stake in
L.A.-based Real Image Technology.

Technicolor, a subsidiary of the U.K.'s Carlton Communications, is paying
$23 million for the stake, with an option to buy another 11.5% at
prenegotiated terms. It has also agreed to invest a further $60 million if
trials of Real Image's approach to the technology prove successful.

Real Image has spent the past five years working with studio,
theater-circuit and technology execs to develop standards for the electronic
distribution of feature films.

While equipment manufacturers Hughes/JVC and Texas Instruments are
front-runners in the race to develop high-resolution digital projectors,
Real Image is focused on the digital compression, encryption and storage of
motion picture images.

The startup has partnered with Sarnoff, a Princeton, N.J.-based research
facility, to create compression technology needed to transmit and store
image data efficiently.

Founded by Linwood Dunn, an Oscar-winning cinema technology pioneer, Real
Image launched publicly at ShoWest in March. Companyıs president is Donald
Rogers, a respected industry veteran and former Warner Bros. senior VP of
post-production services.

Digital age toehold

Technicolor's investment in Real Image comes just two months after the film
processing and print delivery company brought in former DreamWorks
technology guru Rob Hummel to help it gain a toehold in the digital age.
Before deciding to put its money behind Real Image, Technicolor kicked the
tires at three competing companies, including Cinecomm Digital Cinema.
One of Real Image's selling points was its consensus-building approach to
creating an open standard that would allow competing systems to work

Open system

"In Hollywood, the only thing that is going to fly is an open system," said
Hummel, exec VP, digital technologies development. "You don't want to get
into a situation where you have to make five different versions of your film
for five different systems."

Technicolor's move was also preemptive. "I didn't want to wake up one day
and read that someone else had done it," said Hummel.

While Technicolor's photo processing and 35mm print distribution businesses
are grounded in current film technology, the company's long-standing
relationships with studios and exhibitors could give it an edge as it
attempts to move into digital film distribution.

"We're absolutely delighted that Technicolor, a longtime force in the motion
picture industry, is taking steps to assure their involvement in the
future," said Phil Barlow, exec VP of electronic cinema for Walt Disney Co.

Thanks to Complete Post/Bob Blanks for support in 1999
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