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Capex high but 4DX technology another silver lining for Palace
GRAHAM...it’s still early days, but even without a final figure I can say that it’s millions that we have already spent. It is some serious infrastructure that we’ve had to put in to get all the equipment and cinema ready. Everything in this cinema is now computerised — from the screen to the chairs, to the projection room — so it’s some real expenses that we’ve had to deal with, even as we contend with some other outstanding ones.
Business, Business Report
Kellaray Miles | Reporter  
June 14, 2024

Capex high but 4DX technology another silver lining for Palace

EVEN as expenditure to onboard the new 4DX technology continues to mount, director and marketing manager at Palace Amusement Company Limited Melanie Graham believes it’s worth the multimillion-dollar investment, which she hopes will bring more patrons and revenue to the cinema.

Speaking at a launch event on Sunday where the prowess of the new cinematic tool was showcased to a number of specially invited guests, Graham expressed high optimism for the expensive technology to further strengthen Palace’s recovery from pandemic induced fallouts and movie industry strikes.

“It’s still early days, but even without a final figure I can say that it’s millions that we have already spent. It is some serious infrastructure that we’ve had to put in to get all the equipment and cinema ready. Everything in this cinema is now computerised — from the screen to the chairs, to the projection room — so it’s some real expenses that we’ve had to deal with, even as we contend with some other outstanding ones,” she said in an interview with the
Jamaica Observer.

The new technology, expected to have been rolled out from about last year December, Graham said experienced some setbacks as issues ranging from equipment arriving later than planned due to a reduction in the level of traffic through the Panama Canal as the waterway dealt with drought conditions, and the arrival of a special compressor (oil-free and silent) needed to power the operation impeded the process.

“After much runaround we’ve been able to order the right compressor, which is to come from Germany, but we have not yet received it. In the meantime, in order to keep the shows going we have been renting one, which is charged for on a daily basis, and this continues to add to our already high initial expenses which we are still tabulating,” she told the Caribbean Business Report.

Banking on the love for new experiences by local moviegoers, Graham believes the technology, which started out slow in other markets such as Trinidad but later picked up, is likely to do well in Jamaica, especially as more blockbuster movies are engineered to utilise the South Korean, CJ 4DPlex film presentation system. 4DX, in offering a more immersive movie experience, utilises motion seats, special effects (water, wind, fog, snow etc) and other multi-sensory engagements to capture viewers, naturally resulting in the cost for these tickets being at least two times higher than that for regular ones.

At the moment Bad Boys: Ride or Die, the fourth in the Will Smith-Martin Lawrence action-comedy series and which opened with an estimated US$56 million in US theatres, is the only film available for 4DX viewing at Carib. This in another week is to be joined by the more child-friendly Inside Out 2.

After retrofitting one of its smaller cinemas at the Carib 5 flagship in Kingston, Palace should be able to rake in anywhere between $336,000-$448,000 in total revenues for a single sold out showing at its 112-seater 4DX cinema. This, given that tickets continue to retail at $3000 per child (over four years old) and $4000 per adult.

Currently constrained by space, the running order for 4DX films, Graham said, will have to be done alternately, with showings for films being scheduled from early to later times. As the cinema operator, however, looks to grow from the technolgy, the retrofitting of more spaces across its other cinemas (Palace Mutiplex in Montego Bay, Sunshine Palace in Portmore, and Palace Cineplex in Liguanea), Graham said, could become a part of its long-term objectives.

“We would love to have 4DX offered at more of our cinemas but that right now is not on the drawing board — but maybe as soon as we can see our path more clearly,” she stated.

The technology funded with a loan from directors she further hopes will be enough to attract more persons to the cinema, including those corporates who may want to buy out the house for a viewing.

“Led by the viison of one of our directors, we embarked on this 4DX journey out of a need to urgently create more excitement about coming to the cinemas. The technolgy has so far gotten great reviews, especially by the young and young at heart from audiences in all countries, and has taken movie-going to the next level. Saying its immersive is to understate its effectiveness. It has taken the theme-park ride and adopted it for the movies…its hard to describe and therefore needs to be seen and felt,” Graham further said in opening remarks made ahead of the viewing.

The launch of 4DX, which comes in the wake of strong revenues for Palace following Paramount’s highly anticipated Bob Marley One Love biopic, saw the company at the end of its third quarter ended March earning $410.8 million in revenues coupled with rebounded profits of $16.6 million — this as nine-month out-turns grew to $1.1 billion in revenues and $123 million in net profit.

“The movie industry as a whole, not just Palace, has been having a challenge since COVID so we’re really happy for the launch of 4DX locally and we are really hoping that this cutting edge technology will make a difference, as it adds more value to our bottom line. Our financial year ends at the end of June so if we are able to significantly grow current revenues, that will be wonderful,” financial controller at Palace, Carol Lee also said.

“Cinema attendance in the last few years have been really low so with this new immersive technology, coupled with a return from the Hollywood strikes and releases for some of the bigger pictures, we’re really hoping that something good will happen for Palace Amusement. We’ve tried to make sure that the price point is one that will also encourage people to come out and enjoy this theme-park-ride experience,” she added.

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