The movie industry is raising big money to make its screens digital, reports the Los Angeles Times. National CineMedia — a joint venture of AMC Entertainment Inc., Cinemark USA Inc. and Regal Entertainment Group — has hired JPMorgan Chase & Co. to raise $1 billion from hedge funds, private equity firms and banks to finance the conversion of 13,000 screens.

Regal is a big player in the local market but it won’t be the first to get the digital screens. As the Business Press reported in April, Galaxy Theatres has already brought the new technology to the theaters at the Cannery and expects all its theaters to be digital by 2007.

Both the studios and the theaters have an interest in the upgrade. The studios stand to save a lot of money in prints and distribution if theaters are digital and both sides will benefit if the theater experience can be upgraded and attract bigger audiences.

The one piece of the puzzle that hasn’t been worked out, according to the paper, is the fees studios will pay to repay the bonds the investment bank will sell.

One other piece is that not everyone’s a convert yet. Back in April, a spokesman for Brenden Theaters said that there was no marketing advantage in digital. Would you drive across town to see the movie on a digital screen? he asked rhetorically.