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Rural communities across region helping theaters make costly conversion to digital

Maynard Meyer owns and operates KLQP Radio. He and a partner also lease and operate the Grand Theatre in Madison. The building and equipment are city-owned as part of a venture to keep a movie house in the town. Residents of the small community have donated more than $75,000 toward the goal of raising $100,000 to convert the two-screen theater to digital. Tribune photo

MADISON -- As a civic booster and owner of KLQP Radio in Madison for three decades, Maynard Meyer probably attends fundraising events more often than Al Lindner gets out fishing.

Yet nothing prepared Meyer for the catch that came with a fundraising event Wednesday in Madison. A block party raised more than $20,000 in contributions toward buying digital equipment for the Grand Theatre in Madison.

"Wall-to-wall people'' filled the downtown. The 650 people estimated to have attended represents nearly half of the town's 1,500 residents, he noted.

"That tells you something,'' he said.

Madison is now more $75,000 toward its goal of raising $100,000 for the two-screen theatre.

The building and equipment are owned by the city of Madison, but leased to Meyer and Kris Kuechenmeister, his radio station office manager.

From a financial perspective, the two are lucky to break even on the theatre operations, Meyer said. It is the theatre's importance to the quality of life in Madison, and consequent ability to retain and attract new residents, that makes it worth the struggle.

It's why he is hoping Madison is one of the rural communities that will be able to make the digital conversion, and keep the movie business alive in town. It's much more difficult financially for small, rural theatres to make the digital conversion than larger, urban movies houses with larger customers bases, he pointed out.

Moviemakers have made it known that the days of 35-mm film are numbered, and that movie theatres need to install digital equipment and projectors within the next year or two.

It's simple economics. It costs movie producers as much as $2.5 million per movie for the film prints to distribute to theatres. Digital copies cost a fraction of that.

The savings in going from film to digital distribution will belong mainly to Hollywood, while local theatres will see big costs.

It costs about $100,000 to make the conversion for a single theatre, and the costs rise with the number of screens, Meyer explained.

Margins are tight in small, rural theatres. Meyer said he is convinced many will not be able to afford the conversion without community support. "Definitely, there will be quite a few of them going by the wayside,'' he said.

It's an assessment shared by Peter Schoell, who owns and operates theatres in Paynesville, Litchfield, Little Falls and Montevideo. He noted that Fox Films recently announced its plans to cut film entirely by the end of the year.

Those not making the digital conversion will find themselves unable to get major movies, he noted.

Schoell is planning to convert his theatres one screen at a time.

"It couldn't have come at a worse time, economy wise, money wise. Banks aren't looking to do a lot of investing,'' he said.

Tim and Susie Kletscher are completing their first year as proprietors of the DeMarce Theatre in Benson. They credit community-support with making it possible to maintain the movie business started by the DeMarce family in 1925, and help assure its future with digital technology. The community provided a forgiveable loan package to cover a portion of the costs when the Kletscher's purchased the business. That made it possible for them to invest in new digital equipment and projector.

They are very happy to have made the conversion, Tim Kletscher said. It gives them many more options and makes operations much easier, he explained.

Combined with a new, silver screen, the new digital equipment allows them to feature 3D movies. The DeMarce will be able to show the Hobbit movie this fall while many theatres with projectors only a few years older than theirs will not be able to do so.

In Madison, Meyer said he is also looking forward to the advantages that digital technology offers, especially in regards to operations. Right now, he and employee Jim Helgemo are the only two people in town able to operate the film projector.

Helgemo's daughter will be a candidate in the Little Miss Madison program at 7 p.m. June 25. Meyer was slated to be the emcee. "So I had to get somebody else to emcee the program, so I can get over to start the projector,'' said Meyer.

With a digital system, Keltshcer said, putting the show on the screen is merely a matter of punching the right buttons ahead of time.

But getting that equipment in place is very much a matter of finding ways to raise the money. It is a cost that rural patrons will have to pay, either in higher ticket prices or by providing the community support evident in Madison and Benson, noted Schoell.

He's not sure that the success stories evident in Madison and Benson can be re-run in every rural community. And, he warns that raising ticket prices to pay for the conversion will not always work either.

"Most say they are glad to see you are here, but that is as far as it goes. You raise the (ticket) price and they will go somewhere else,'' he said.

Like Meyer, he believes that the digital conversion means rural Minnesota will ultimately have fewer screens. "It's going to be a whole different picture I think in a year and a half or two years. There will be a lot of towns without theatres.''

Tom Cherveny

Tom Cherveny is a regional and outdoor reporter with the West Central Tribune in Willmar, MN.

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