posted 08-18-2005 04:17 PM                    

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Deadline Hollywood

Hollywood to Newsosaurs: Drop Dead

August 17, 2005 | Nikki Finke

As Daily Demos turn gray, Hollywood ad dollars go away by NIKKI FINKE
In a surprising role reversal, Hollywood is about to deliver bad news
to the Los Angeles Times and The New York Times and, to a lesser
extent, other big-city dailies around the country. Every major movie
studio is rethinking its reliably humongous display ad buys in those
papers because those newsosaur readers are, to quote one mogul,
"older and elitist" compared to younger, low-brow filmgoers - so
it makes no sense to waste the dough.

Wait, it gets worse: I've learned that at least two Hollywood movie
studios have decided to drastically cut their newspaper display ads as
soon as possible.

This news couldn't occur at a worse time for the LAT and NYT, which
both receive the lion's share of those very showy $100,000-plus
full-page after full-page movie display ads. At Spring Street, editor
Dean Baquet just moved into the power office on Monday, and publisher
Jeff Johnson only took over his hot seat on June 1. In Times Square,
culture editor Sam Sifton has barely put his stamp on the section since
assuming the post in May. Now comes a body blow to their beefed-up
cultural coverage.

In response to the recent turf war initiated by his former employer and
current national competitor, the NYT, Baquet, a proponent of moving
Hollywood coverage onto Page One, has made it his professional mantra
to "own" the beat. The NYT over the past year has underwritten a
huge increase in editorial employees and space in its culture sections.
But without those big movie ads to foot the bill, both newspapers may
not be able to justify the increased pages and bigger overhead
they're devoting to arts and entertainment coverage.

I have long maintained, and frequently written, that the nearly
simultaneous decision by both the LAT and NYT to increase the space
devoted to, and upgrade the quality of reporting on, culture is the
direct result of these newspapers' attempts to woo even more
Hollywood advertising than the large amount they already receive. For
some time now, movie ads are no longer the one bright spot in an
otherwise dim display-ad picture for even these newspapers. According
to Wall Street's Goldman Sachs, newspaper ad revenues are growing at
a dismal pace. Goldman Sachs pegged the weakness to decreased spending
in entertainment, which makes up 14 percent of national revenues for
the newspaper industry.

The foremost financial analyst of the newspaper business, John Morton
of Morton Research, tells me that not only are newspaper display ads
"flat to down a little" this year compared to last, but newsosaurs
still haven't recovered from close to $1 billion in ad losses
resulting from consolidation in the retail industry. Likewise, the
reason for the decline in entertainment display-ad expenditures no
doubt lies in the continuing wave of Hollywood studio consolidation.
But unlike retail stores, which traditionally place their display ads
in the first section of the paper, movie display ads go reliably and
exclusively where movie articles appear: in the arts and culture pages.
Therefore, papers argue that this is a win-win situation for themselves
as well as readers.

All well and good for the papers, and even readers, but what exactly is
Hollywood getting for its ad bucks there? Little, from the looks of it.
The numbers don't add up.

According to the Motion Picture Association's 2004 U.S. movie
attendance survey, overall, 12-to 39-year-olds accounted for 57 percent
of total moviegoers, 40- to 59-year-olds only 31 percent, and
60-plus-year-olds only 12 percent.

Look at the demographics for newspaper readers and it's almost
exactly the reverse. The Scarborough Research Top 50 Market Report
found that 35- to 54-year-olds are the biggest readers of daily
newspapers, followed by those 55 and older. A much smaller portion of
readers came from 25- to 34-year-olds, followed by the barely there 18-
to 24-year-olds. And despite the newspaper industry's efforts to
reach a younger audience, the Readership Institute notes that the
biggest decline in daily newspaper readers was in the 18-to-34 group.

One way newspapers attract younger eyeballs is by writing about mass
entertainment, since it's the province of the young. Yet ousted NYT
editor Howell Raines was savaged by media critics when he gave a story
on Britney Spears Page One placement. Today's paper, under his
replacement Bill Keller, reads increasingly like TomKat 24/7. That's
also why newsosaurs are giving the US/People/Star fans more pop-culture
news, either in spinoff freebies like the Chicago Tribune's Red Eye,
or within the regular paper like the Los Angeles Times' extensive
revision of its features sections, changing both format and content to
infuse a newer 'tude (which we all know is just a rip-off of The New
York Times' first-on-the-block features redo).

All advertisers dearly love the 18-to-34 demographic, and the Hollywood
movie studios are no exception. In their eyes, the newsosaurs aren't
measuring up. Sources at the two Hollywood studios who are axing their
movie display ads in newspapers gave me that information on the
condition they not be identified. But, studiowide, it's on
everyone's to-do list. "We're rethinking our newspaper ads and I
mean, literally, on every movie. Everybody is," one movie mogul tells
me. "The only people who read newspapers are older and elitist.
Movies like Sky High don't need ads in The New York Times. But the
studios did it because newspapers were seen as a necessary evil.

"But I don't think it's as important anymore."

Now the box office bust, combined with bloated promotion and
advertising budgets to market every film, are forcing Hollywood to
change the way they look at these expenditures. "It's not only the
cost of the space, it's also the cost of the color," a top studio
movie marketing exec complained. "It's always another whole weekend
full of newspaper ads. The average amount is a Thursday ad, a big color
ad on Friday, more on Saturday and Sunday, and ads for sneak
previews." Then there are the declining circulations. "You'd
think it would get cheaper because it doesn't reach as many people as
it used to." Indeed, the Audit Bureau of Circulations keeps finding
that something like half of the nation's 38 largest papers report
circulation declines. That's why the Oracle from Omaha, Warren
Buffett, has been quoted as saying recently that "the economics of
newspapers in the United States are very close to certain to
deteriorate over the next 10 to 20 years." And this is coming from a
self-described newspaper addict and savvy media investor.

There are still those quaint reasons why Hollywood studios keep
advertising movies in newsosaurs: predictably, theater info, and,
inexplicably, talent relations.

Only moguls who don't know how to turn on a computer (and many
don't, believe me) would insist that those ads displaying movie
running times and locations contain information that filmgoers can't
access on the Internet. In fact, the Pew Internet and American Life
Project released a study last month finding that nine out of 10
American young people, ages 12 through 17, have online access, while 66
percent of U.S. adults now use the Internet.

It's also just as ridiculous for Hollywood studios to continue to
kowtow to actors, directors and producers by spending vast amounts on
newsosaur display ads that make no strategic or financial sense.
"It's about talent relations. The only reason you do it is because
the talent expects it," one mogul admits to me with unusual candor.
"These people like to see their ad in the paper. It's ego feed."
Another studio executive suggests that top talent would take a role or
bring a project to a rival if demands like this weren't met, even
though this is hard to swallow at a time when many of the industry's
best filmmakers in front and behind the camera are jobless.

If only the moguls were as concerned about offending the sensibilities
of their shareholders.

Email at nikkifinke@deadlinehollywood.com

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posted 08-19-2005 01:03 PM                    

quote: David Stambaugh

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Instead they ran a very small ad with just a phone number and a URL. That lasted about a month. Then they went back to their regular-style listings every day.

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