3d projector bottleneck may leave cinemas reeling

Tokyo/BRUSSELS (Reuters)-
3D films like James Cameron\'s Avatar open a new chapter for the movie projector industry, but a happy ending depends on the ability of electronics companies to make components fast enough.
\"The challenge will not be much you can sell, and there will be much you can do,\" Eric Van Zele, the chief executive of Belgium, digital projector manufacturer Barco (BAR. BR).
\"We really have a serious problem with how we go beyond what we can do now.
About 85% of the world\'s cinema screens have yet to be equipped with digital projectors. Britain-
According to Dodona, a theater research firm, there are 115,000 cinema screens in 57 countries around the world.
The number of screens installed with digital projectors in 2009 is estimated to range from 13,000 to 17,000.
Barco thinks it can make about 0. 15 billion euros. $203. 6 million)
From digital movies in 2010.
However, unless it is able to help eliminate supply bottlenecks caused by component manufacturers, companies may be forced to check for further growth.
These small private holding companies that produce printed circuit boards, optics and dedicated chips have been working to meet the latest needs of digital films.
In the fourth quarter of 2009, Barco shipped a total of 36 million euros worth of projectors in the quarter, but its revenue may increase by 40%.
\"If we have enough parts, we can easily ship 10 to 15 million euros more,\" a spokesman said . \".
Arnaud Gossens, analyst at ING, the Netherlands international group, said: \"2009 was the best quarter in sales and delivery, and I estimate that Barco shipped about 1,000 projectors, this reflects that their maximum capacity is very close.
\"Multiply it by 4 and you will get a little more than 4,000, so 5,000 will push it to the limit,\" he said . \".
Still, Barco announced last month that 2009 was the best year ever for digital films, and sales of projectors more than doubled, adding that it plans to expand sales in 2010.
Cinema operators are benefiting from digital conversion, which means the demand for digital projectors has never been so big.
\"Our current progress
\"Out plans will enable us to further benefit from the higher revenue and attendance rates we have already experienced in 3D,\" said Drew Caza, executive vice president, digital development at ODEON . \".
ODEON, a leading European cinema chain owned by private equity group Terra Firma, has just ordered new digital projectors from NEC Display Solutions, a subsidiary of Japanese electronics manufacturer NEC Corp (6701. T).
NEC, another leading company in the market, also faces demand in short supply.
\"We are meeting very strong demand, and our supply is lagging behind demand,\" said a spokesman for NEC Display Solutions . \".
\"After the great success of Avatar, the cinema seems to be scrambling to install a digital cinema projector.
She added that the company would consider expanding production if demand maintained its current strong momentum.
Christie or Stech, vice president of Christie\'s operations, is owned by Japan\'s tail (6925. T)
Another major competitor of Barco also sees supply chain issues as the main problem.
\"The remaining urgent question is whether the supply chain can keep up with the demand for parts as soon as possible to meet the demand for projectors,\" he said . \".
\"We are working hard to work with our supply base to ensure rapid growth in component availability.
To address this issue, Barco is considering funding the expansion of its suppliers in exchange for discounts on components and even introducing a second supplier for some components.
However, it may take months for this to have any impact.
Cinema operators are struggling to adjust their screens to show digital films, which makes them feel short.
\"Of course, we are told that there are not enough machines to meet the demand.
But we managed to make sure what we needed, \"T-
Grand Hyatt Co. , Ltd. is a Japanese theater operator with 13 theaters and 119 screens, and is a subsidiary of film producer Toei Co. , Ltd (9605. T).
\"Our plan is to install digital cinema projectors for all of our screens by June and we are working to achieve that,\" he said . \". (
Editor Mike Nesbit)