What role could new digital technologies play in this game for the market?

- Yes, that is the future of this industry. I think in 10 years we'll no longer want to watch films in any other technology. Most cinemas will be equipped with digital projectors. But the issue remains how to finance it.

Fortunately, this is a problem first for the big movie studios. [Laughs.] Our financial capabilities are very big, and we can install many digital projectors. On the other hand, where and how fast to do it? This is a decisive issue for us! But we have another competitive advantage: we build so many new screens that we have the ability to choose what to do with the projectors that are already in the cinemas. Take for example Arkadia in Warsaw. We are installing four digital projectors there, so we can move the "classic" projectors from Arkadia to other cinemas, even in other countries. Competitors who are growing more slowly don't have that ability. Projectors purchased just four years ago may go to the cinemas in Bielsko-Biała, Zielona Góra or Bytom, wherever CCI is about to open cinemas. We are building 9 cinemas in Poland with over 100 screens, some of them will have digital projectors from the day one and some of them will have projectors previously used in other cinemas.

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However, I don't think that digital technology should determine the future in the sense of deciding about the success or failure of firms from our market sector. A wall is made of bricks. This is not that one keystone that the whole meaning of life depends upon. It's just one of the bricks you need to built the wall. Certainly it's not a small brick. A single digital projector represents a serious investment, with a cost of some EUR 80,000 to 120,000.

Faced with such costs, what rate of return on investment appears to be attractive?

- I would put it this way: first, the Hollywood studios will take on a certain portion of the costs themselves. In this way they retain the cost of making prints. Second, digital technology makes 3D projection possible, which will not in fact apply to most films. A 3D production is not going to be shown in all the cinemas, but it will increase profits. Third, you need less manpower; for example, at Arkadia when there will be 15 digital projectors, they will be operated by much less workforce.

Where is there still room on the market for expansion, including for digital projection? Multiplexes in smaller and smaller cities? What is the limit for that road of expansion?

- We don't go into cities with a population of less than 80,000 to 100,000. Of course, the lower limit is attractive because we are the only player with a cinema of 6 to 8 screens, and the investment involves creation of an entertainment center for the whole local community. People want to have a cinema close to where they live. They won't drive from Bielsko-Biała to Cracow. In this business we need to take into account that a large portion of our customers don't have a driver's license, because they're teenagers. Children go to the cinema with their parents, but when they turn 14 or 15 they want to watch movies with their friends, and they can't drive yet so in this case the multiplex in the city center with good public transportation is a good solution.

The IMAX cinemas haven't caused a revolution among viewers. How do you evaluate the share of the IMAX cinemas in the revenues of the CCI group? What lines of business have the most beneficial effect on the company's EBITDA and net profit?

- I admit that IMAX has not been a success in some countries, and that's because mistakes were made in the marketing strategy. But the IMAXes of Cinema City in Warsaw and Prague are among the best in the world. Not long ago an IMAX cinema was opened in Sofia, and it's a great success. I expect it will be similar in Budapest, where the IMAX cinema opened this January and it is sold out every weekend all the shows.

IMAX is part of the cinema business, so as the classic IMAX movies are for a specific audience: children, especially school trips we are also showing regular movies on these big screens. In Poland, IMAX tickets account for 7% of our ticket revenues, which is a lot The bulk of our revenues, over 70% comes from theater revenues: ticket sales, concessions and advertising and they are contributing the most to our EBITDA as well. Our real estate activity is also the source of profits but the level depends on each transaction individually. Film distribution, bringing some 15% of revenues, is not participating largely in the profits but it`s our strategic tool leveraging the volume of tickets sold in our cinemas.

The main risk factor for cinema owners is the repertoire of movies. Are you excited when you look over the production plans of the big movie studios this year?

- Oh, yes! I personally view the new items sent by the big movie studios. I check which film projects are delayed, and why.

Do you look forward to seeing Shrek V, or further episodes of Pirates of the Caribbean or Ice Age? Doesn't it get tiresome?

- Commercial productions bring in the biggest box office, and it's always exciting to see what smash hits might come along. Naturally, the whole industry dreams about seeing as many films as possible with the box office success of Shrek or Pirates of the Caribbean. Sequels also interest us, for example Harry Potter and Indiana Jones. On the Polish market, Polish productions are also important.

Can the cinema sector reduce the repertoire risk in some way? Are there any methods for diversifying the operations?

- Bad movies are like a holiday without sunshine - you can still enjoy it but it`s not perfect. If the movies are disappointing, viewership in the cinemas is lower than we projected, and there's not much we can do to make up for the shortfall in our revenues.

A weak film season is the main risk in the business, but the chance of this happening is relatively small. There are, after all, six big movie studios in the world, plus 20-25 big independent producers. Then there is European cinema, and local productions. Thus the risk that all these producers will go in the wrong direction in the same time is relatively limited.

CCI established a company in Hungary in 2006 which is the exclusive distributor of films and DVDs from two major American movie studios: Warner Bros and Sony (Columbia). Is this an idea to reduce business risks, and will it be repeated in other countries?

- Business is seeking out new possibilities and seizing the opportunities that present themselves. In Hungary that opportunity presented itself. Now, together with the Disney Company, we are opening a DVD business in the Czech Republic.