Market Insight

CGR exports its premium cinema experience to Middle East

February 22, 2019

Pablo Carrera Pablo Carrera Principal Research Analyst, Cinema
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CGR and Majid Al Futtaim’s VOX Cinemas have announced a partnership to bring ICE, the Premium Large Format offering by CGR, to cinemas in the Middle East. The first three territories where ICE will be available will be Saudi Arabia, Kuwait and the United Arab Emirates. Each ICE room has been reported to require €1M investment.

The groups are the leading exhibitors in France (where CGR ranks first in number of cinemas and second in number of screens) and the Middle East respectively. CGR operates 682 screens in 75 sites in France, of which 25 host ICE screens. Now CGR wants to take that ambition globally and the agreement with VOX Cinemas marks the start of the journey. The agreement may extend into other areas in the future.

ICE’s immersive experience features several state-of-the-art solutions in both image, audio and seating. The main screen is lit by a 4k Christie laser projector that produces a brightness up to 60,000 lumens, although the main differentiating visual factor is the Philips LightVibes technology, which consists of panels on the sides of the cinema room which offer mood lighting related to the content in the main screen to enhance the visual atmosphere. The sound is delivered in Dolby Atmos and all seats are recliners and positioned in curved rows for better orientation.

CGR expects to release 20 films in ICE format in 2019.


Our analysis

CGR Group has experienced little organic growth in the last two years (0-1%, broadly speaking France’s screen growth rate) but the group increased its footprint by 50% with the acquisition of Cap Cinemas’ 196 screens in November 2017, becoming the largest exhibitor in France by number of sites (Pathe is first by number of screens).

This deal with VOX Cinemas takes CGR to a new level as it is both expanding internationally and becoming a vendor of technology/premium cinema concept. The deal however has been described as a partnership rather than a pure trade deal, and this may have to do with the commercial terms and probably shared risks.

The transition to exhibitor-vendor has so far only been done by CGV Group, which installed its Screen X PLF format in its South Korean CGV cinemas before taking it internationally. CGR is set to take a similar route and leverage its footprint and in fact it has installed 22 ICE systems in its French theatres in the 12 months of 2018, plus two more in January and February this year, a fast deployment.

Content is the third cornerstone to a successful PLF venture, together with audience reach and technology. The existing footprint, the commitment and such a quick initial roll-out has helped secure content by bringing actual audiences to the negotiating table with Hollywood studios to reach the 20 film a year benchmark.

It is not a coincidence that CGR has started its international venture in the Middle East, one of the fastest growing regions that offers a still low screen density (10 screens per million population, compared to 67 in Western Europe) and moreover, an inclination towards premium experiences. Both 4D and PLF enjoy a relatively high penetration, with UAE in particular having one of the highest worldwide. 

Vox Cinemas had 311 screens at the end of Q4 2018 in eight territories, including Saudi Arabia where it unveiled its second multiplex at the end of January and plans a total of 110 screens this year. It has its own PLF brand, Vox Max, which features laser projection, Dolby Atmos and recliner seats and is installed in 18 screens in H2 2018. Although in theory it could conflict with ICE as both are premium large format experiences, the added immersive element brought by LightVibes should be enough to differentiate the offerings. It remains to be seen where the ICE screens will be installed and what performance it brings, which Vox will inevitably benchmark against that of its own brand.

IMAX is the most prominent PLF brand in the Middle East with 20 screens in the second half of 2018, some of them with Vox Cinemas. Although a different format with very distinctive elements and brand, IMAX expansion is somehow threatened by CGR’s partnership with Vox insofar there is a limited number of cinemas that can take a PLF offering and ICE may be taking some of those and reducing market availability for IMAX.


France Middle East UAE
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