First, he brought mobile boarding passes to airports. Now, Sam Sahana is helping theaters make the most of the mobile and digital experience. From mobile apps to speed the sales of tickets and popcorn to booking a theater via social media just for friends, Sahana understands the value of bringing a mobile device to the theater even if you are expected to turn it off once the movie begins. He also understands that the new economic frontier in the film exhibition business is e-commerce.
"This time in the industry is critical," says Sahana, currently CTO of Odeon & UCI Cinemas Group. "I've been very fortunate because I led transformation with the airlines launching their portals. That was the beginning of my e-commerce career, and I have a long history of doing this. I'm fortunate to have the right team and industry climate so that I can replicate the experience with Odeon."
What does that mean, exactly, for movie exhibitors like Odeon, the number one cinema chain in the world outside of the Americas? For starters, it means Odeon's leap into the world of film digitization in 2011—a leap that took it far afield of its competitors, about two years before Sahana came on board—is being taken to the next level. "Until 2009, pretty much every movie you went to see, aside from IMAX, was an analog print film played on a projector, a technology that's been around for 100 years," says Chris Coulter, a partner in Morrison & Foerster's London office and a member of the firm's Technology Transactions and Global Sourcing groups. "The big studios were very keen for that to change because shipping a copy of the film costs serious dollars."
While the moviemaking community (distributors) was eager to save that cost by getting theaters on a digital platform, the exhibition community (theaters) was looking at a huge technology investment to show a film sent via satellite or shipped on a hard drive. Odeon, with assistance from Coulter, came up with an innovative plan to finance the conversion. "The structure involved the establishment of a tax-efficient vehicle backed by private investors, Digital Deployment Associates that acquired and deployed the digital platform for Odeon," Coulter says.
From this digital platform, Odeon has been able to deploy more 3-D technology and live sports and to try out more new content than other cinemas. And last year, Sahana— whose background includes stints in private equity and as CIO of a global airline trade body—came on board to expand the platform. Sahana's initiatives have included Odeon's deal last spring consolidating electronic digital content delivery via broadband to a single technology platform provided by MovieTransit from Unique Digital. "The MovieTransit system also allows Odeon to transport all the different kinds of content—theatrical content or movies, trailers, advertisements, and live content such as sports or opera— across one technology platform," Sahana says.
Most important, the technology enables Odeon to offer customers some unique opportunities, such as booking a theater for a group to see a film that is out of theaters but not yet available at home, or filling a theater with your child's friends for a bigscreen viewing of The Wizard of Oz. "Unique Digital has created a content catalog and booking system enabling exhibitors to allow consumers to digitally book content on demand," says Sahana. Good for the customer, and good for the theater, which may fill no more than 20 percent of its seats on an ordinary day.
Sahana is translating transaction data into customer insights that will allow Odeon to deliver increasingly personalized offers, driving up sales to satisfied customers. In a business with high fixed costs, the frequency with which customers fill seats matters a great deal. But personalization comes with legal issues. "As customer data increases in importance, understanding privacy and protecting data become essential," Coulter says.
Odeon is also the first chain in Europe to launch free consumer Wi-Fi and is investigating new mobile and online payment and self-service tools such as PayPal on the Continent. As Odeon develops customized enhancements to its platform, issues emerge involving ownership of apps and interfaces, providing more legal and business challenges in this wild digital Western.
Keywords: E-commerce, Outsourcing, Sourcing, Technology Transactions
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