Village Centre Cinemas Wandermere, a 14-screen complex, soon will equip one of its theater rooms with a high-tech, 45-foot-wide screen and a larger projector for 3-D movies.

This final piece is all that remains to finish a conversion of the North Spokane multiplex to all-digital equipment. It's also part of a roughly $3 million overhaul for a full-digital conversion under way at a total of five independent movie theaters in the Spokane and Palouse regions that operate under the theme name, Village Centre Cinemas, including one in Airway Heights.

The movie industry is abandoning 35mm film production, and by sometime in 2013, all new distributions are expected to be available only via highly secure digital hard drives or satellite downloads.

"Basically, if you're not going digital, you'll go dark," says Duane Brelsford, a partner in four of the Village Centre theaters. He is president of the Pullman-based Corporate Pointe Developers, which oversees operations for all five theaters. Each theater is a single-entity LLC business and has a different mix of owners.

He says national movie outlets have either converted to the all-digital format, or will soon as well.

National chains with theaters here include the AMC Theaters River Park Square 20 cinema complex, and AMC Entertainment Inc.'s Spokane Valley Mall Stadium 12, Coeur d'Alene Riverstone Stadium 14, and NorthTown Mall Stadium 12.

Village Centre Cinemas Wandermere's 60,000-square-foot theater opened in 2006 at 12622 N. Division. Three screens have had digital equipment for about two years now, says manager Sergio Contreras. Work began in May to convert the other 11, with 10 screens done by early June.

Village Centre Cinemas Airway Heights, a 33,000-square-foot complex built in 2008, has one of 10 screens digitally equipped but has a full conversion scheduled this fall. The other theaters include an eight-screen Pullman complex, where the retrofit was just completed; a 12-screen center in Lewiston that's being converted now; and a five-screen theater in Moscow, which will follow Lewiston.

Brelsford says that for Village Centre theaters, the digital upgrade costs about $60,000 to $70,000 per screen, which in the industry includes everything that supports a movie shown per auditorium, including the screen, projector, computer server to download film, satellite, and sound system.

The Village Centre Cinema group will participate in an incentive reimbursement program offered by major movie studios called Virtual Print Fee (VPF).

"We have gotten into a program the studios have set up, the VPF program, and the studios will pay a certain amount back to theaters for the conversion per film," says Sean Warner, a Pullman-based Village Centre general manager. "It helps recoup about 70 percent of the investment costs."

Warner adds that technology with movies is only getting better. This fall's "The Hobbit" will have a much higher frame rate per second, allowing for a better picture quality he calls "phenomenal."

"With this equipment we're putting in, that will allow us to run that at the higher frame speed, and more films will be coming out that way," he says.

Another benefit of technology upgrades will be the ability for the theaters to offer concerts and sports events via satellite, Warner says. The group has had success with this concept in Pullman, he adds, through individual ticket sales and a series package showing the San Francisco Opera.

"They've negotiated to where we'll be able to stream live the Metropolitan Opera," Warner adds. "We'll look at expanding this to other theaters. Some theaters have offered the World Cup."

Drew Devlin is a Bozeman, Mont.-based co-owner in many of the Village Centre theaters. He also buys films for about 300 independent screens mostly in the West, including Village Centre Cinemas.

While some 35mm prints may be available "somewhat into next year," he says, "It's a sweeping change affecting the smallest mom-and-pop theater to multiplexes. Most of the multiplexes have converted, and now it's just filtering down to some of the smaller theaters."

The National Association of Theater Owners says more than 27,000 movie screens in the U.S. were digital as of April, a number that represents about two-thirds of total domestic screens.

At another independent Spokane movie outlet, the Garland Theater, owner Katherine Fritchie says a digital upgrade is planned in the next several months. Located at 924 W. Garland Avenue, it shows second-run movies, but the conversion is still necessary, she says.

"If we want to stay in business, we have to participate," Fritchie says. "It's more cost effective for the studios to have everything in digital format. It's expensive for them to print in 35 millimeter."

Garland Theater manager Dena Carr says the digital conversion is expected to cost "slightly higher" than $60,000 to $70,000, because of the larger sizes of Garland's single screen and auditorium, which has a 608-seat capacity. The 1945-built theater doesn't qualify for the movie studio VPF incentive program, Carr says, because it isn't a first-run movie theater.

Another independent theater, Hayden Cinema 6, is said to be exploring the digital conversion as well, but the owner of the theater didn't return a call for more information. That theater is located on the northeast corner of the Prairie Shopping Center at Highway 95 and Prairie.

Corporate Pointe also manages a separate discount movie theater in Lewiston with three screens, but that site isn't scheduled for the digital conversion, Warner says. He adds that the Lewiston discount theater is expected to close once the movie industry converts to the solely digital format.

Village growth
As far as business growth for all five Village Centre Cinemas theaters, they have experienced a rise in annual revenues by operating in what Brelsford calls underserved outlying areas, away from the shadow of national movie chains here. Combined, the five theaters employ about 200 people in full- and part-time jobs.

"We're seeing a good gradual growth in all of our theaters," Brelsford says. "It grew because we saw underserved markets, and we were just trying to fill those voids."

He says Wandermere Village Centre draws customers from North Spokane, Whitworth University, Mead, and farther north from Deer Park and Colville.

"When the Newport (Cinemas) was closing; that's where we saw opportunity," Brelsford says. "Airway Heights is projected to grow both commercially and residentially."

Brelsford says that at this time, Village Centre Cinemas isn't considering development of any new movie complexes.

He says annual revenue for Village Centre theaters is up 10 percent to 12 percent this year as compared to a year ago. He also credits a steadier crop of hit movies. Recent big movie draws include "The Hunger Games," "The Avengers," and "Brave," which will be followed by the July release of "Dark Knight Rises."

He adds, "You'll find the quality of the films is getting better. Certainly, the summer is one of the best seasons, but they're sprinkling it out more."

Brelsford says that operating the five independent theaters together offers some group buying advantage to stock concessions, which he says results in lower costs to customers. Ticket prices in the Spokane area are comparable to the national chains here, he adds, and slightly lower on the Palouse.

"We can control the environment and prices," he adds. "Our concession prices are considerably lower than our competition in the Spokane market. We try, obviously, to keep our prices down."