HOLLYWOOD: US movie companies who depend on exports for more than half their revenue, hope that a proposed trade agreement will eliminate customs difficulties as the industry abandons film in favour of digital formats, according to an industry official.

“The iconic spools of film we're all familiar with will soon be relegated to the Smithsonian,” Greg Frazier, executive vice president for the Motion Picture Association of America told the U.S. International Trade Commission.

By 2016 virtually every movie screen in the world will be a digital screen” Frazier said at a hearing on proposed talks to expand the 1996 Information Technology Agreement (ITA) which eliminated duties on many information technology goods.

“When you go to see the new (James) Bond movie that opens this weekend, you're probably going to see it in digital format,” Frazier said.

Frazier told the panel that the U.S. movie industry wants “digital cinema packs,” which have replaced traditional film reels, included in an expanded agreement.  Frazier said that "the devices didn't exist when the first ITA was negotiated in 1996. But by last year there were more digital screens around the world than traditional screens, something that has dramatically cut the cost of distributing movies."