• by Erik Sass  @eriksass1, October 6, 2010

National CineMedia, the nation's largest cinema advertising company, announced it will be getting another digital upgrade, courtesy of founding members AMC, Cinemark, and Regal Entertainment Group. All are installing new digital cinema projection systems in their theater circuits with more 3D advertising capabilities.  

NCM, which already uses a digital network for distributing and projecting ads and other content, said the new system will also allow it to present 3D live and pre-recorded events.

In 2007, AMC, Cinemark, and Regal, the country's three largest movie theater chains, formed a joint venture, Digital Cinema Implementation Partners, to create a national network of 3D projectors. DCIP raised $600 million of new financing to carry out this formidable digital infrastructure project, which will triple the current number of 3D screens. Altogether, the upgrades will bring new digital projection systems to roughly 15,230 screens over the next three years, according to NCM.

The cinema advertiser will use the new projection systems to present enhanced versions of its "FirstLook" package of pre-show advertising and entertainment content, in conjunction with its Fathom Events experiential marketing program.

The 3D projection upgrades follow a series of initiatives to expand NCM's digital ad offerings in theaters, lobbies and online. NCM unveiled its first 3D cinema ad on April 2 -- a spot promoting Samsung's new 3D LED TV, created by Leo Burnett and placed by Starcom MediaVest.

The cinema advertising world has been especially active in recent weeks, including last week's news that Shamrock Capital purchased a majority stake in NCM's chief rival Screenvision from previous owners U.K.-based ITV and Technicolor. ITV sold the entirety of its 50% stake in Screenvision, while Technicolor is retaining a small stake.

Last year, total cinema ad revenues grew 2% from $571.5 million in 2008 to $584 million in 2009 -- a modest gain, but impressive compared to steep drops in print and broadcast last year. But the business is dependent on the health of the movie business overall, which seems to be hitting a rough patch after expansive growth in 2009.

According to The Hollywood Reporter, total summer movie ticket sales fell 1% to $4.24 billion this year, while total admissions dipped 6% to 538 million.