Category: Business

Report: Disney in Talks to Acquire Pixar
LOS ANGELES – The Walt Disney Co.’s possible acquisition of Pixar Animation Studio could make Pixar CEO Steve Jobs a member of Disney’s board and its single largest shareholder, a newspaper reported Thursday.
Shares of both companies rose slightly Thursday after The Wall Street Journal, citing unnamed sources familiar with the plan, reported Disney was in serious talks to buy Pixar.
Both companies declined comment to The Associated Press Thursday.
Pixar has made several hit movies, including “Toy Story” and “Finding Nemo.” Jobs is its largest shareholder, with more than 60 million shares, or 50.6 percent, according to Pixar’s filings with securities regulators last year.
At its current share price, his stake is worth about $3.44 billion.
Jobs also heads Apple Computer Inc., the maker of the hugely successful iPod music and video player.
“Investors may hope that Mr. Jobs’ successful track record at Pixar and Apple will rub off more broadly on Disney,” Richard Greenfield, an analyst at Pali Research, wrote in a report Thursday.
Greenfield estimated that Jobs could gain a 6 percent stake in Disney as the result of a merger. Disney’s largest reported individual shareholder now is former CEO Michael Eisner, who owns 1.8 percent of outstanding shares.
Pixar shares rose $1.61 a share, or 2.81 percent, to close at $58.87 Thursday on the Nasdaq Stock Market. Disney shares gained $1.04, or 4 percent, to $26.24 at the close of trading on the New York Stock Exchange.
Disney CEO Robert Iger has made it clear that technology will be a cornerstone of Disney’s success in the future. Having Jobs on Disney’s board could strengthen the link between Disney’s content and the technology that links TV shows, movies and music to consumers.
“In our view, no company understands both technology and the consumer better than Apple,” analyst Kathy Styponias of Prudential Equity Group wrote.
Reports of a possible Disney-Pixar merger first surfaced several weeks ago after shares of Pixar jumped, leading analysts to speculate that Jobs might become Disney’s chairman.
Disney and Pixar have been talking for months about a new relationship.
Disney has co-financed and distributed Pixar’s animated films for the past 12 years, splitting the profits. But that deal expires in June after Pixar delivers “Cars.”
The company, based in Emeryville, is already at work on its next several films but has yet to decide if Disney or another studio will distribute them. The studio makes one movie a year.
Many analysts expect a new distribution deal soon but dismissed the idea of Disney buying Pixar as so expensive that it would dilute Disney’s earnings for several years.
Others said that if Disney paid only a slight premium for Pixar’s shares, as the Journal report suggests, Disney could recover fairly quickly, especially if Pixar increases its production to two films per year.
“Despite dilution in the near-term and the likely negative impact Disney’s stock would take should it acquire Pixar, we believe the deal would make sense both strategically and, eventually, financially,” Styponias wrote.

DreamWorks Sale Highlights Studio Obstacles
LOS ANGELES – Steven Spielberg, Jeffrey Katzenberg and David Geffen tried to harness their collective star power in 1994 to do what hadn’t been done in more than 70 years √≥ start a Hollywood studio from scratch. They called it DreamWorks SKG, the letters standing for the last names of the founders.
Sunday, DreamWorks ended its 11-year run as an independent company by agreeing to be sold to Paramount Pictures, a unit of Viacom Inc., in a deal valued at $1.6 billion. The sale highlights the enormous, perhaps insurmountable, challenges facing an independent company with hopes of competing against massive media conglomerates.
“It’s very hard for anyone to enter the business from the ground up,” said Harold Vogel, author of the book “Entertainment Industry Economics.”
“It’s not the talent of the individuals. They were superb, they had a brilliant idea, they had connections. But the costs of running the business ran much faster than they expected.”
DreamWorks accomplished much in its short life, including winning several Academy Awards, producing a hit TV series and making the most successful animated movie in history.
The company, under Geffen and Spielberg, will continue to make films that will be distributed by Paramount.
DreamWorks Animation SKG, under the leadership of Katzenberg, was spun off into a public company last year and is not included in the Paramount deal, although it will distribute its films through Paramount.
DreamWorks had grand plans to become a major player in music, film, television, video games and the Internet. But over the years, it scrapped plans to build a high-tech studio lot in Los Angeles, sold DreamWorks Records to Universal Music Group and curtailed its TV production.
“When Steven, Jeffrey and I started the company and had to put an entire infrastructure together from day one, we had hoped to be able to make enough films to rationalize the cost of being our own distributor,” Geffen said Sunday.
“Sadly, we were never able to make enough films to make that economically sound.”
Distributing is a fixed cost that runs into the tens of millions of dollars for a staff that can sell films to theaters in the U.S. and abroad.
A handful of independent film companies still remain, including the Canadian company Lion’s Gate Films.
Lion’s Gate has been able to build a substantial library of films, in part through acquisitions. An extensive film library from which to sell pictures on DVD and to cable and television is key to producing the kind of cash that can reduce the risks of box office flops.
“Library values are like real estate in Southern California √≥ they generally go up every year,” said David Miller, an analyst at brokerage firm Sanders Morris Harris.
DreamWorks was able to build a library of only 59 live-action film titles. Ownership of the more lucrative animated films was transferred to DreamWorks Animation.
A number of production companies make films but distribute them through third parties. Those companies include Pixar Animation Studios, which produces one film a year and distributes through The Walt Disney Co. Revolution Studios, which made such movies as “The Fog” and “Rent,” distributes its movies through Sony Pictures.
One company trying to succeed where DreamWorks failed is The Weinstein Co., formed by brothers Bob and Harvey Weinstein.
The brothers formed Miramax in 1979 and sold it to Disney in 1993. Earlier this year, they left Disney to form their own company after disagreements with Disney’s management.
The pair left behind their library of around 800 films and, like DreamWorks, is starting from scratch to make and acquire films and build their own distribution network.
The Weinstein Co. does have the right to make sequels of some of its Dimension films, including “Sin City” and “Scary Movie.” And it just entered a joint venture to distribute its own DVDs, which will save it potentially millions of dollars in fees over the years.
The Weinstein Co. has raised about $500 million in cash and an equal amount in debt financing. That might not be enough. Vogel says a minimum of $2 billion is needed to comfortably finance both the production of a full film slate and distribution.
“The barriers to entry are high, which is why guys like the Weinsteins and anyone else who wants to go out and start this has to find external financing,” Miller said.
“The risk remains very high that businesses like this will crash and burn,” he said.

Cruise Control Shifts Gears
Tom Cruise is “restructuring.”
Hollywood’s leading leading man has dumped sister Lee Anne De Vette as his publicist and enlisted power publicity firm Rogers & Cowan.
The moves come in the wake of Cruise’s endless summer in which he talked up War of the Worlds, vitamins and exercise, and Katie Holmes–not necessarily in that order.
In the tradition of Hollywood divorces, the Rogers & Cowan-for-De Vette swap was announced on Friday. And in the tradition of press releases about Hollywood divorces, the statement accentuated the positive.
Technically, the release wasn’t about De Vette’s dumping. Rather, it was about her being tapped to “exclusively oversee the day to day operations of Tom Cruise’s philanthropic activities.”
Cruise, 43, praised De Vette for having done a “wonderful job” as his personal publicist. De Vette, for her part, was “thrilled” with her new duties. There was no mention of Cruise and De Vette choosing to remain friends, but it was understood they would remain siblings.
As part of Cruise’s staff “restructuring,” as the statement put it, Rogers & Cowan also will handle publicity for the star’s production shingle, Cruise-Wagner Productions. The company’s upcoming projects include Mission: Impossible 3, due out next summer.
Rogers & Cowan, PR home to stars such as John Travolta, said on Monday it was not representing Holmes. Cruise’s with-child fianc√àe recently ditched her own longtime publicist, Leslie Sloane, for De Vette.
De Vette succeeded Pat Kingsley as Cruise’s publicist last year. Under Kingsley, Cruise cemented his status as the world’s top movie star. With De Vette, Cruise enjoyed his biggest box-office hit ever (War of the Worlds) and suffered his worst publicity ever.
A recent report by Genius Insight, a New York-based marketing and research firm, found that Cruise’s likeability sunk among 13- to 49-year-olds as the actor jumped on Oprah Winfrey’s couch to declare his love for Holmes, took Matt Lauer to task for being “glib,” prescribed vitamins and exercise for Brooke Shields and other women coping with postpartum depression, and generally became an outspoken advocate for Scientology. Per the study, Cruise went from the 11th most liked celebrity in the spring, to the 197th most liked celebrity in the summer. Worse, he joined David Spade, Pauly Shore and Tom Green as one of the five most polarizing stars. (Ashton Kutcher rounded out the group.)
To Ann Gabriel, a public relations expert who testified at Michael Jackson’s molestation trial about the PR debacle the singer faced in the wake of the 2003 Martin Bashir documentary, Living with Michael Jackson, Cruise’s summer was a 15 on the PR Disaster Scale of 1-10, with 10 supposedly being the most disastrous. (On the stand, she said Jackson’s Bashir problem rated a 25.)
“I think it was off the scale,” Gabriel said of Cruise. “I think if he’s truly happy with his life there were probably some ways he could have better chosen to portray his newfound happiness.”
Gabriel, who briefly worked for Jackson in 2003, said Cruise and the pop star are similar in that both lost touch with the public.
“I’m sure Michael didn’t perceive his actions would be scrutinized the way they were or possibly misinterpreted,” Gabriel said. “And I don’t believe Tom Cruise believed his comments about postpartum depression would be as scrutinized.”
Cruise’s publicity firm shakeup is a sign to Gabriel, for one, that “he understands that he may have overstepped some of those boundaries.”
In short, maybe next time sit on the couch.

Eisner leaves mixed legacy as Disney chief
LOS ANGELES (Reuters) – When Michael Eisner hands over the keys to Disney’s Magic Kingdom on Friday after 21 years of running the media giant, he’ll leave behind a stormy legacy — brilliant early success mixed later with executive turmoil, an operational slump and a shareholder revolt.
But industry experts say that ironically, as Eisner says farewell as Disney’s chief executive officer, the company has begun to return to the double-digit earnings growth that marked his first decade running Disney with late president Frank Wells.
Under new CEO Bob Iger, Disney will continue facing challenges settling issues at its movie studio — including landing a new distribution deal with Pixar Animation Studios. But with a new park in Hong Kong open, and a turnaround at TV broadcaster ABC in progress, Eisner is leaving on a high note.
“His legacy is brilliance, mixed with turmoil,” said Hal Vogel, a veteran Wall Street analyst and money manager who has tracked the media industry for years.
There is no doubt that Eisner’s tenure has been successful. In the 21 years since he joined a then struggling Disney, the company has gone from $1.5 billion in annual revenues to nearly $31 billion today.
The stock price was $1.33 in 1984 and traded at around $24 a share on the New York Stock Exchange on Thursday. Disney has split its shares since 1984, and Disney said $10,000 of its stock 21 years ago would now be worth more than $200,000.
When Eisner ran the company alongside No. 2 executive Frank Wells, it seemed Disney could do no wrong. Along with studio chief Jeffrey Katzenberg, they reinvigorated Disney’s vaunted film animation group, cranking out movies like “The Lion King.”
SUCCESS TO MISSTEPS
The early successes peaked in 1995 when Disney agreed to acquire Capital Cities/ABC, which owned the ABC and ESPN TV networks, in a $19 billion deal. A year earlier, Wells died in a helicopter crash.
Katzenberg left Disney after failing to ascend to Wells’ job. Eisner instead hired Hollywood superagent Michael Ovitz to be president, but he departed in 1996 after clashing with other Disney executives and his former friend, Eisner.
Katzenberg later sued Disney for bonus money and settled for an amount reported to be around $250 million, and Ovitz got a severance package with an estimated value at $140 million.
“After Frank died, you can’t say the company did much of anything that was all that brilliant,” said one former Disney executive who asked to remain unidentified.
Although ESPN has proven highly valuable, ABC stumbled badly until this past year when hit comedy “Desperate Housewives” and drama “Lost” sparked a viewership rebound and higher advertising revenues.
Wall Street viewed Disney as paying too much in 2001 when it agreed to acquire Fox Family Channel from Rupert Murdoch’s News Corp Ltd. for $5.2 billion, including debt.
The company had been an ambitious player on the Internet, but in 2001, it shuttered its uncompetitive GO.com Web portal and took over $800 million in quarterly charges.
Like others, Disney’s theme parks suffered from a tourism slump after the September 11 attacks on the World Trade Center and Pentagon, although they have since rebounded.
The missteps caused Roy Disney, nephew of company founder Walt Disney, to launch a campaign to oust Eisner. The board made many of the changes Roy Disney advocated, although Eisner leaves on his own terms.
Iger still faces issues ahead. ABC’s recent hits need support from new shows like presidential drama “Commander in Chief” to keep ratings momentum going.
And the studio must rejuvenate its Miramax Films specialty division and its animated division, perhaps signing a new distribution agreement with Pixar Animation Studios Inc. after Eisner alienated Pixar CEO Steve Jobs.

Fantasy deal reunites Fogerty with his songs
LOS ANGELES (Billboard) – John Fogerty laughs when he says his next album of new material will be on Fantasy Records. “That’s a phrase I never thought I’d say,” he notes with glee.
In a turn of events almost impossible to believe, due to Concord Records’ acquisition of Fantasy, the singer/songwriter has been reunited with the catalog of his rock band Creedence Clearwater Revival after a 30-plus-year battle. And he has signed a long-term deal for his future recordings with the label.
In a well-told tale, Fogerty fought for years with former Fantasy owner Saul Zaentz, who went so far as to sue Fogerty for plagiarizing himself. Fantasy owns the masters to such CCR classics as “Proud Mary,” “Bad Moon Rising” and “Fortunate Son.”
To buy his freedom from Fantasy, to which he owed at least 30 more albums, Fogerty struck a deal that meant he would never receive artist royalties from CCR recordings.
For years Fogerty was so embittered by the fight with Zaentz that he refused to perform the hits live, although he has for several years now.
When Concord first contemplated buying Fantasy late last year, Fogerty and his manager/wife Julie approached the label, initially just to say, “I’m the guy who wrote all the music you’re thinking of purchasing,” he says.
After the $80 million deal closed early this year, Fogerty’s talks with Concord resumed, resulting not only in collaboration on his beloved catalog but on new material. Fogerty was without a label after Universal’s purchase of DreamWorks a few years ago.
INVITED TO THE TABLE
“The folks at Concord really had respect for my work. That was quite different for me,” he says. “For 35 years I’ve been treated like a hired hand that kind of snuck his way into the dinner table, and that wasn’t very nice.”
The reunion with his babies — his songs — has left him delighted and filled with many emotions. “I just had no reason to even dare hope this could happen,” he says. “That’s my first emotion. But No. 2 is that it shouldn’t have been that way in the first place. But I’m not going to dwell on that one for very long because I spent so many years feeling like it was wrong. I’m just going to accept what it is and be very, very happy about it.”
One of Concord’s first moves was to offer to pay Fogerty artist royalties on his CCR material going forward. The checks should start rolling in after the release of his first complete career retrospective, “The Long Road Home,” out November 1.
A live DVD, taped September 15 in Los Angeles, will follow. Then, Fogerty says, he will turn to writing new material.
Concord president Glen Barros says he knows his label cannot fix the past for Fogerty, but he believes it can create a happy future. “A big part of that was reuniting him with what he did with CCR. While we’re looking forward to his new music, we also want to make sure we promote the great body of work. Now he can feel good about everything he can do with this music.”

Union agrees BBC deal, job cut talks to begin
LONDON (Reuters) – The BBC can begin plans to cut 4,000 jobs after a technical workers’ union voted on Monday to accept a revised offer put forward by the public broadcaster’s Director General Mark Thompson.
About 92 percent of members of the Broadcasting Entertainment Cinematograph and Theatre Union (Bectu) voted to accept a one-year guarantee of no compulsory redundancies while talks move forward on how to reduce staff by 20 percent.
About 41 percent of Bectu members voted on the proposal. The other two BBC unions, the National Union of Journalists and Amicus, previously had agreed to the offer.
Talks are now set to begin at a divisional level to seek redundancy volunteers, according to Luke Crawley, Bectu’s top BBC official. The union said it has reserved the right to strike if too many people are offered such packages.
“Managers with direct responsibility for day-to-day activities will be expected to explain how the BBC can continue to function properly with 20 percent fewer staff,” Bectu said.
In addition to delaying any compulsory redundancies for one year, the BBC agreed to put off the sale of its BBC Resources unit for at least two years. It had been scheduled to be sold much sooner.
Staff at BBC Broadcast also were promised access to final salary pension scheme comparable to the BBC’s and other assurances that terms will remain unchanged for at least three years.
The unit is being sold to Australia’s largest investment bank Macquarie Bank Ltd. and investment fund Macquarie Capital Alliance Group. The group agreed to a one-year moratorium on compulsory job cuts.
The compromise deal with the world’s largest public broadcaster came about after the unions had gone on strike for a day and had been planning more work stoppages.

TV commercials create the latest hip playlists
CANNES, France (Reuters) – You’ve seen the ads, now get the soundtrack.
Advertising firms are relying increasingly on the vast libraries of pop, rock and roll and dance tracks to accompany TV spots and commissioning less original music that can turn into an unforgettable jingle. The phenomenon has helped launch new bands like never before as artists have overcome a previous reluctance to have their music associated with corporate brands.
An iPod commercial featuring the song “Jerk It Out” catapulted Swedish band Caesars into wider recognition and British sensation Coldplay only got discovered in the United States after TV network NBC used “Yellow” in a promotion. Companies targeting younger consumers use independent music from around the world to make their products seem hipper.
“A major marketing move for bands has been getting on a commercial,” Chris Milk, a TV commercial and music video director, said this week at the advertising industry’s annual get-together in the south of France.
“In the past, a song on a commercial made you a sell-out, but now because the cool indie rock bands are doing it, it’s opened it up for everyone,” Milk said.
Indeed, everyone from James Brown and Led Zeppelin to Jimi Hendrix and Elvis have had their music used to flog cars, computers, beverages and soap. Important turning points for music in ads were Nike’s use of the Beatles’ “Revolution” in 1987 and Microsoft’s Windows 95 launch to the tune of the Rolling Stones’ “Start Me Up.”
Techno star Moby licensed every song off his 1999 album “Play” for commercial use.
Apple’s iTunes online music store now has a section devoted to popular songs used in advertising, making it easier for fans to buy something they have heard on television.
U2 recently changed its tune by agreeing to an iPod campaign to help launch its latest album, but rocker Bruce Springsteen and rapper Eminem are among the remaining few holding out.
GET RICH ON DOWNLOADS?
The increasing use of music libraries has made it even cheaper for ad firms and their clients to license a song, as has the perception that record companies and bands will get rich selling CDs and downloads after the commercial airs.
But that could just be a successful negotiating ploy.
“I think there can be a tremendous benefit to a new band, and when it works, it’s fantastic, but it happens rarely,” said Barbara Zamoyska, head of film, TV and advertising for Universal Music Publishing in Britain.
“A lot of new artists are used in commercials but it doesn’t sell lots of records for most of them,” she said.
Some in the ad industry are railing against the use of existing music and trying to persuade companies to get more creative and commission their own original songs.
The highly regarded Honda “grrr” ad for a cleaner diesel engine, which is widely favored to take the top prize this weekend at the International Advertising Festival, uses an original song by radio host Garrison Keillor with an infectious whistling refrain.
“Don’t think because music doesn’t come off a CD that it’s less beneficial,” said Michelle Curran, founder of Amber Music, which helps advertisers with sound design and who worked on the “grrr” commercial.
She said she is frustrated that advertisers are reluctant to pay the usually higher price to commission original music, even though it can make their ad stand out, and that they’re willing to spend more on expensive locations and other facets of an ad.
“It also becomes something the client owns without it being seen as nasty and tacky,” Curran said.
Another common problem that holds back the writing of an original jingle is that music is often left as an afterthought when creating a commercial, or at least relegated to the very end of the process when pressure is higher to finish it.
“Most advertising doesn’t realize music’s full potential,” said Craig Davis, the chief creative officer for JWT Worldwide, a unit of WPP Group. “When done right, music packs emotional power and has a profound effect on the end product.”

Garth Splits With Capitol
In a surprising move, Garth Brooks and Capitol Records Nashville have ended their longtime association. Capitol has been Brooks’ only label home since his career began in 1989 and together the artist and label have sold more than 100 million albums, according to the Recording Industry Association of America (RIAA). He remained with the label even after he announced his retirement from the music business in October 2000. His last album, “Scarecrow,” was released in 2001.
Calling it a “mutual agreement,” Capitol parent company EMI said in a statement that while terms of the split are confidential, “no compensation was requested by Mr. Brooks or paid by EMI for the license termination.”
Capitol released a total of 15 projects from Brooks including a box set, a hits package, a double live album, three holiday CDs and one pop album he recorded under the name Chris Gaines. Brooks’ most successful album, 1990’s “No Fences,” is certified 16 times platinum by the RIAA.
“For nearly two decades, Capitol Nashville has had an extraordinary and fruitful relationship with Garth,” said Capitol Nashville president and CEO Mike Dungan in a statement. “We wish him all the best for the future.”
In 1992 Brooks, who recently became engaged to fellow country artist Trisha Yearwood, renegotiated his contract with Capitol. At the time, he told Billboard, “I’m not sure that this deal will ever be made again in this sort of fashion because it’s not your typical deal. It’s a full incentive contract where we start from scratch every time. If we don’t sell any records, we don’t get a cent; and if we sell a lot of records, we get a lot of money … it’s that black and white.”
Since his renegotiation, Brooks’ albums were licensed to EMI under his own Pearl Records label.

Bertelsmann buys Columbia House music club
FRANKFURT (AP) – German media company Bertelsmann AG said Tuesday it is buying the New York-based DVD and music club Columbia House.
Bertelsmann did not disclose the terms of the deal, under which the Guetersloh-based company’s BMG division will acquire Columbia House. Citing people familiar with the deal, the Wall Street Journal reported it was worth approximately 312 million euros ($400.1 million US).
The U.S. retailer is 85 per cent owned by Blackstone Group. Sony Corp. and Time Warner each hold 15 per cent stakes.
“This move gives us strategic access to the growing business with DVDs, as well as broadening our customer base in the U.S. market,” said Ewald Walgenbach, CEO of Bertelsmann’s DirectGroup unit.
“In bringing together BMG Direct and Columbia House, we are combining two profitable businesses.”
Columbia House has some eight million members in the United States, Mexico and Canada and sells music online and through the mail. BMG Direct operates its own mail order retail business, sending out 68 million catalogs annually and through its Web site.
Bertelsmann said Stuart Goldfarb, chief executive of BMG Direct, would be president and CEO of Columbia House.
Bertelsmann’s reach encompasses nearly all forms of media, with publishing, music sales and broadcasting operations in approximately 60 countries worldwide.
The company, founded in 1835, owns the Random House publisher as well as a 50 per cent stake in Sony BMG Music Entertainment. It holds a 75 per cent stake in publisher Gruner + Jahr and has 90 per cent of broadcaster RTL. It also owns several book and music clubs, including DirectGroup.
Bertelsmann is not listed on the stock market. A majority stake is controlled by the Mohn family, directly and through a foundation. Group Bruxelles Lambert holds a 25 per cent stake.

Loews Goes Reel Time
Hate going to the movies and having a commercial-a-thon break out?
This might be the news you’ve been waiting for.
Coming soon to a theater near you: actual start times for feature presentations.
In response to gripes from customers about the increasing number of ads, PSAs, promotions and sneak previews running before a film, Loews, America’s third-largest theater chain, has announced that it will soon start publicizing the real times that movies unspool.
But there’s a catch. Beginning next month, Loews will include in its newspaper and Web listings a note alerting customers that “the feature presentation starts 10 to 15 minutes after the posted show time.”
“It has been a long-standing tradition to show coming attractions and advertising before the feature, and we believe most of our customers understand this practice,” Travis Reid, president and CEO of Loews Cineplex, says in a press release.
He added: “Recently however, some of our customers have suggested that we also publicize the start time of the movie. In response to those requests, we are pleased to communicate the start time of the overall show, as well as the approximate start time of the feature.”
That’s one way of putting it.
Traditionally, moviegoers would sit through cutesy “Let’s All Go To the Lobby”-type spots attempting to coax the audience to concession stands, followed by a handful of coming-attraction trailers. In recent years, as local movie houses have expanded into megaplexes, exhibitors have begun to wring every ounce of revenue from each showing. First, more trailers were added. Then came the now standard slideshows of local merchants interspersed with lame-o trivia and Muzak-esque “movie tunes.” There were also short films designed to hawk everything from Coca-Cola to the Los Angeles Times. Now, exhibitors routinely air long-form commercials that have little to do with the theatrical experiences, including spots for automobile manufacturers, perfume makers and credit card companies.
Loews isn’t the only offender. Regal Entertainment touts what it calls “The 2wenty,” a 20-minute block of advertising and “preshow entertainment” that mixes informercials for DVDs and TV movies with behind-the-scenes visits with stars–the idea being to make it entertaining enough that people don’t notice they’re being marketed to.
Audiences have finally begun to rebel, launching www.captiveaudience.org, a campaign petitioning theater chains to end the practice, and Commercial Alert, a Portland, Oregon-based nonprofit dedicated to reducing the over-commercialization of American culture.
“Stating when the actual movie starts is an improvement, but doesn’t change our opinion that TV commercials have no place in movie theaters,” Jason Thompson, director of Captive Motion Picture Audience of America, tells E! Online. “We don’t get commercials on HBO, pay-per-view or other movie services that we pay for, so why should we tolerate them in theaters?”
Ditto Commercial Alert’s executive director, Gary Ruskin, who points to a study by Connecticut-based research firm Insight Express that stated a majority of moviegoers don’t want to see premovie ads.
“These premovie ads are very unpopular…We’re talking about an industry that seems hell-bent on alienating its core customers,” Ruskin says. “The moviegoing experience is turning into an infomercial experience.”
Even politicians are now entering the fray. Andrew M. Fleischmann, a Connecticut state representative, made headlines last month when he introduced a bill calling for exhibitors to post the actual start times. Perhaps not so coincidentally, Loews will begin its reel time experiment in Connecticut. New York City Councilwoman Gale A. Brewer sponsored similar legislation.
Despite its new initiative, Loews still expects people to arrive well before the feature gets rolling.
“We still think people enjoy coming early, getting their popcorn, finding their sets, talking amongst one another,” John McCauley, Loews’ senior vice president of marketing, tells the New York Times.
And Madison Avenue will be there waiting.