Marks
For many attendees, ShoWest is a time to size up the Hatfield-McCoy battles waged for decades between exhibitors and distributors.
This year, however, one feature on the landscape represents a watershed exception.
The preshow, once a deeply unpopular collection of crudely assembled ads and trivia-question slide shows, has morphed into a digitized, half-billion-dollar business that thrives on collaboration between exhibs and distribs. It has grown at a dramatic clip -- up 15% in 2006 to $455 million, according to the most recent Cinema Advertising Council annual revenue report, and doubling in the past five years.
Helping to drive the boom are a fragmented and uncertain TV ad climate, overall strength at the B.O. and theaters' comeback from the bankruptcy-riddled 1990s.
Defined as the roughly 20-minute block of content and ads that appears before the trailers start, the preshow is dominated by two players: National CineMedia and Screenvision. CineMedia is a consortium of three major circuits: AMC, Cinemark and Regal; Screenvision is jointly owned by U.K. network ITV and French media tech firm Thomson.
Both companies have hired hosts to handle themed segments that weave ads together with clips featuring interviews and behind-the-scenes material from upcoming releases of Disney, Warner Bros. and NBC Universal. Their reach now collectively extends to about two-thirds of the country's 37,000 movie screens, and a few smaller entities also have preshow offerings.
The makeup of the preshow usually gets shuffled every two weeks to make sure nothing gets stale for frequent moviegoers, who are the preshow's early adopters.
The market could not have blossomed without audience acceptance. Arbitron, which tracks the preshow biz on behalf of the Cinema Advertising Council, found in 2006 that 53% of frequent moviegoers (those who went five times in the previous three months) found ads in theaters more palatable than those on TV.
That's a big change from the start of this decade, which was marked by some studios' reluctance to allow preshow ads and audience mistrust that crystallized in moviegoers' class-action suit against Loews Cineplex. The suit, which claimed the chain misled the public by starting ads, not the movie, at the showtime listed in newspapers, helped spur Loews to list the movie start time alongside the preshow time in print ads.
Some pockets of resistance remain, but many stadium-seating dwellers are won over by the production values showcased in theaters, given the technology and the scope of the medium. Some spots, like a digitally animated one for Coca-Cola or a Martin Scorsese starrer for American Express, debut in theaters before migrating in shorter form to extended runs on TV.
"We are a network broadcasting to the living room," says Cliff Marks, prexy of National CineMedia, "only in our living room we have a 40-foot screen."
Marks left a longtime gig selling ads at ESPN in 2002 to enter the nascent world of the preshow. "It was a completely unproven concept at that point," he recalls. "But when Phil Anschutz put together Regal, United Artists and Edwards, suddenly he controlled 7,000 screens and you said, 'Now we have scale.' "
Screenvision, by contrast was launched in 1975, the lone tumbleweed in the desert.
"The ads were all on film," remembers Darryl Schaefer, exec VP of exhibitor relations at Screenvision. "You had to buy the whole network, and there was no flexibility. It just wasn't practical."
Today, with 7,000 of its 14,800 screens operating digitally, different spot lengths, regional targets and costs of ads can all be mixed and matched.
Digital technology, including the satellite feeds that beam the preshow into theaters, have also enabled the companies to get results from a long-promised revenue source: so-called "alternative" content.
Screenvision beamed New York Mets baseball games into several theaters and saw robust demand. CineMedia linked up with the Metropolitan Opera for its successful series that started last year.
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