Does a little movie signal the end for cinemas?

Industry rattled by simultaneous theatrical, TV and DVD release of Soderbergh's new film

It's a film that has the industry on tenterhooks. Is it the beginning of the end of the movies as we know them - or does it mark an exciting new departure into an almost unlimited future of digital entertainment?

The subject of this speculation is Steven Soderbergh's experimental new film Bubble, which comes out in the US on 27 January. A low-budget arthouse project, it has been shot with an entirely non-professional cast in and around an Ohio doll factory.

It's not the film itself that has the movie world in a lather but the way it is being distributed, for Bubble will be the first feature released simultaneously in cinemas, on pay-per-view television and on DVD. As such, it is widely being seen as a portent of things to come.

The production company behind Bubble, 2929 Entertainment, has no fewer than six low-budget movies by Soderbergh - the award-winning director of sex, lies and videotape, Erin Brokovich and Oceans Eleven and Twelve - that it intends to distribute in exactly the same way. The company's principals, Mark Cuban and Todd Wagner, don't have to worry about industry resistance, as they already own a chain of arthouse cinemas and are launching their own DVD label.

Besides, the industry is quickly coming to accept that the age of the delayed DVD is coming to an end. The gap between theatrical and DVD release has been closing fast in recent years, from six months or more to as little as six weeks.

One reason for that is that the DVD market is going from strength to strength, while America's cinemas have just suffered their worst year in memory. According to a preliminary estimate, published by Variety last week, the number of ticket admissions fell a staggering 11 per cent in 2005. The top 15 money-makers, led by the final instalment in the Star Wars saga, Revenge of the Sith, were roughly on a par with 2004's box-office leaders but everything else fell far short.

Does this mean the age of the multiplex is coming to an end? Many analysts suspect it does, although they don't necessarily see this as a bad thing. The big "event" movies will still get a theatrical showcase. Arthouses, meanwhile, are likely to grow in strength as niche marketing via the internet becomes more sophisticated. It is only the mediocre schlock in the middle that is likely to go straight to DVD - where it may well be missed by precisely nobody.

Simultaneous, or "day and date" releasing, as it is being dubbed, may help the marketing of small films that can only hope to find theatrical release in major US cities but which may well appeal to audiences scattered far beyond.

"DVD and other technologies have liberated cinephilia from the parochial confines of New York and a scattering of college towns," the New York Times critic A O Scott wrote excitedly last week. We can expect a restructuring of the industry - analogous to the advent of television or the home video - but certainly not its demise.

Asked what he thought of the doomsayers who worry that DVDs will replace movies entirely, the veteran producer Mike Medavoy said recently: "There'd be no DVDs without the movies, so I don't know what they are thinking."