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The competitive threats to companies in the cinema sector are wide, varied and often difficult to predict.
Not only is there competition between the established cinema chains to get people through their doors, but the sector is also coming under attack from newer market entrants, such as on-demand streaming services from Netflix and Amazon Prime.
The sector’s performance is also sensitive to changes in the weather, particularly in the summertime, while the broadcasting and celebration of major sporting events can reduce footfall.
Then there are delays to the release date of highly anticipated films, which can have a knock-on effect. That is precisely what happened to Odeon and UCI Cinemas Group in 2014. Several, potentially high-earning films had their release dates pushed back in the summer of that year so as not to clash with the Fifa World Cup in Brazil, leading to downbeat attendance figures.
“Despite a better Q4, 2014 was a poor year for attendance globally with an exceptionally light film slate due to the Fifa World Cup, lack of family content, and tentpole titles like Fast and Furious 7 being moved to 2015,” according to the company’s 2014 financial report.
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That same year saw some big organisation changes undertaken at the cinema group, including the appointment of a senior management team who decided to boost the company’s “digital capability” as part of a wider bid to drive up profits.
David Miskell, group infrastructure architect at Odeon, says the company’s digital push has largely centred on finding ways to improve the customer experience.
“We’ve had projects designed to get better insights into our customers and get more information about them so we can serve them more efficiently, target them with campaigns more effectively and deliver a better overall customer experience,” he says.
“The films we show are common across every cinema chain, so our focus has to be on customer experience [as a differentiator] from their first interaction with us on the web or on the app, right until they walk into the cinema.
“That’s what drives everything, including the digitalisation programme, because offering a first-class cinema experience is what will keep people coming back.”
Cloud clears way for digital transformation
The digital push is one of the major reasons why Odeon has made a concerted effort in recent years to embrace the use of private and public cloud services, Miskell adds.
“We’ve been moving away from a more traditional retail model of selling tickets in cinemas and what have you, and building our online and app-based presence and pushing more trade through those channels.
“We have used public cloud and it’s where we developed a lot of our platforms, but we also have a large IT heritage and legacy we still need to manage and maintain. There are elements of things we develop [in the cloud] we may want to keep on-premise for a number of reasons.”
There are some workloads that need to remain on-premise for latency purposes, for instance, prompting the cinema chain to favour a hybrid cloud approach to IT delivery.
“Our core ticketing and film booking systems are on-premise, and we have split test and development across both environments. What we tend to use public cloud for is brokering to third parties,” Miskell explains.
A lot of the back-end processing work for the Odeon gift cards the company sells in supermarkets, for example, is carried out in the Amazon Web Services (AWS) public cloud.
Private cloud deployment
The company has recently taken steps to reinforce its commitment to the hybrid cloud approach by enlisting the help of Manchester-based IT services provider ANS Group to deploy a managed private cloud platform within its own co-location facility.
The setup replaces an existing virtualised infrastructure that had served its purposes and was approaching capacity, according to Miskell,. It also allows the company to take advantage of infrastructure as a service (IaaS)-type capabilities in a private cloud setting.
It also comes equipped with disaster recovery and business continuity functionality, while ANS takes care of its maintenance and support on a 24/7 basis.
The Rapid cloud platform is designed to help organisations get up and running in the cloud quickly, with ANS quoting a deployment window of 28 days for the setup.
To achieve this, the platform is delivered to the customer site with all preliminary integration and test working already carried out.
The ability to get up and running quickly was a critical consideration for Odeon and its digitisation agenda, which is focused on ensuring the company is positioned to respond to changes in consumer demand as fast and efficiently as possible.
“The alternative would be buying the hardware and then layering a cloud management platform on top of that – either from VMware, Microsoft or OpenStack – that gives you the automation, the cost tracking of the VMs and that type of thing,” says Miskell.
“It’s quite resource-intensive and, in my experience of working with other organisations that have gone down that route, you typically need to take out a big professional services engagement with an IT partner after putting the infrastructure on site.
“So, you put the infrastructure on site and you might have 100 days of professional services, five days a week over 50 weeks, and it can take a long time to see a return on that.”
With the Rapid private cloud systems now in place, Miskell says the organisation hopes to have completed the process of moving its existing, legacy systems to the new setup by September 2016.
“What we’ve ended up with is an Amazon public cloud-type experience with a private cloud,” he says.
“ANS manages the hardware, the hypervisor, and monitors the health of our platforms and our virtual machines.”
The successful execution of a hybrid cloud setup is often gauged by how little the user experience differs between environments.
Odeon, Miskell says, has achieved consistency here through the use of DevOps-type automation, and provisioning tools from the likes of Puppet and Jenkins to generate new virtual machine instances in either environment.
“We can log into a portal, spin up new virtual machines, and we use Jenkins and Puppet to provision and configure environments in AWS and in the private cloud too,” he says.
“So what we effectively have is a hybrid cloud infrastructure as a service that can be consumed using DevOps tooling – such as Jenkins and Puppet – to spin up new instances.”
While the company is making use of the tools of DevOps, Miskell says the company is a little way off fully subscribing to more agile ways of managing software development and deployment.
“Getting the tooling right and taking advantage of that is one thing, and culturally things are changing as well. We have a traditional waterfall approach to projects, but we’re getting a little more iterative and agile as we proceed, which is lending itself to that change,” he explains.
“We can see DevOps is the end goal, but I wouldn’t say it’s something being actively pursued. It’s more of an acknowledgement that this is the way the industry is going, and we’re trying to do things the best way we possibly can.”