Walt Disney Co, Viacom Inc's Paramount Pictures, News Corp's Twentieth Century Fox, General Electric Co's Universal Pictures and Lions Gate Entertainment Corp. are the five Hollywood studios that concluded an agreement in the rollout of digital cinema. Thus digital projector will replace the conventional film projector and will offer unique experiences such as 3D cinema.

The financial deal is estimated at over $1 billion with a group of theater exhibitors to digitally upgrade 20,000 U.S. and Canadian cinema screens. Our initial goal is to convert the existing theaters of our owners, AMC and Cinemark, and Regal, which operate a little over 14,000 screens in the U.S. and Canada," Travis Reid, chief executive officer of the Digital Cinema Implementation Partners (DCIP) said. Adding digital equipment is the critical first step in the technological upgrade to being able to show 3-D movies. The rollout is expected to take more than three years.

Investment banks JP Morgan and Blackstone are providing financial backup to the rollout plans.

The consortium of theater owners, which is called the Digital Cinema Implementation Partners and includes Regal Entertainment Group, Cinemark Holdings Inc. and AMC Entertainment Holdings Inc., has been willing to add the technology but hasn't wanted to bear the cost alone. Under the agreement, the studios will help defray the $1 billion it will cost to install the expensive digital projection equipment.

Under the DCIP plan, 15,000 screens will be provided with the technology next year, with a target of converting almost all in three to four years’ time. It costs around $70,000 to outfit a screen with digital projectors.