Sony Electronics’ Digital Cinema
Solutions group is expanding its menu of purchasing and financing options with
a new lower up-front cost, no interest
Virtual Print Fee (VPF) Program. This newest program further enhances Sony’s
efforts to help make the digital cinema conversion easier for exhibitors of all
sizes.
“The transition to digital cinema is a
reality, but so are the conversion costs for an exhibitor,” Tim Smith, Vice
President, Business Development, Digital Cinema Solutions, Sony Electronics. “That’s
why Sony has put in place several flexible purchasing and financing options for
exhibitors in North America that can make converting to digital easier and more
affordable.”
Sony has deployed its 4K projection systems under studio VPF agreements
with exhibitors of all sizes across several countries. Payment agreements are in place with all six
major U.S. studios for a variety of territories, as well as more than 100
independent studios worldwide.
In addition
to the new low up-front cost program, Sony also offers direct purchase,
exhibitor-managed financing and lease options. Each has its own distinct
benefits, and Sony also offers a full range of programs for exhibitors in other
countries, with options and benefits varying by region.
In
both the lease and exhibitor-managed programs, motion picture studios subsidize
not only the projectors, but also the library servers/networks, 10-year parts
warranty, shipping costs and Sony’s proprietary theater management software.
“Exhibitors
installing Sony 4K through the exhibitor-managed program also get certainty of
ownership costs combined with the ability to potentially take advantage of IRS
bonus depreciation* programs,” added Smith.
Through the Sony leasing program, exhibitors
essentially enter into an industry-unique 10-year operating lease arrangement
with Sony with a one-time exhibitor contribution, which is a low initial
payment bringing numerous tax* and balance sheet benefits. Many exhibitors are able to treat this
payment as an operating lease on their balance sheet, with the ability to
distribute that cost across the term of the agreement. Through this lease, Sony is providing
interest-free financing, and lower sales taxes,* where applicable, because they
are frequently charged only on the one-time lease payment, rather than on the
total value of the system. In some
instances, the lease can be assignable in the event that a complex is sold or
closed. In many cases pre-deployed Sony
systems and non-Sony systems can be included under the lease to take advantage
of the studio subsidy collectively.
All
of these terms require credit approval and exhibitors should work with their
tax advisors to understand and maximize the value of the lease.
The Sony VPF model is designed to be the most comprehensive VPF offering
on the market. The package includes Sony’s
fully DCI Compliant system (4K projector, 2D lens, screen server/media block,
Screen Management and Sony’s proprietary theater management software, central
server and storage network, 10-year parts warranty, 2-year labor warranty, 24/7
help desk, Cinewatch™ remote system monitoring), along with shipping costs and
installation. There are also options
available to extend the labor warranty to a full 10 years as well as to provide
preventative maintenance services.
“Sony’s VPF model is customizable to fit an individual operation’s
financial needs as well as its timeline for converting to digital,” Smith said. “Sony will work with an exhibitor throughout
the entire process of digital conversion, to ensure that all the exhibitor’s needs
are being met at every step.”
These VPF and
finance options are just one component of Sony’s full range of technology solutions
for digital cinema, including remote monitoring, 24/7 Network Operations Center
and help desk, digital menu board and box office signage, video surveillance,
and much more. Future Sony alternative
content offerings will bring additional value to exhibitors.
* Please see
your tax professional for guidance and advice.
Sony does not provide tax advice.
