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Can H'w'd afford its tube touts? Soaring ad rates testing studios' TV dependency.(Hollywood)(includes "Movie Media Tab" financial statistical table)

Variety

| April 26, 2004 | Graser, Marc | COPYRIGHT 2008 Reed Business Information, Inc. (US). (Hide copyright information)Copyright

Film execs are under the gun to "do something" about soaring marketing costs. But as they study where the money's going, Hollywood honchos have the sinking feeling things are only about to get worse.

Few in Hollywood were surprised when the MPAA announced in March that film marketing costs had jumped 28% in one year.

Television has long commanded the biggest percentage of a pic's marketing dollars, and it's only gotten more expensive as networks keep raising ad rates.

Film execs have questioned whether TV ad buys can be reduced, or if they can rely more on bigscreen trailers, print, the Internet or word of mouth.

But they've come up with no options that can rival the clout of TV. With a $100 million-$200 million film, too much money is at stake to risk pulling back on TV promos and the millions of people an ad could instantly reach.

"Spending begets more spending," says Paramount marketing chief Gerry Rich.

Major studios devoted 59% of their marketing dollars to broadcast and spot TV buys in 2003, according to TNS Media Intelligence/Competitive Media Reporting. That compares with 32% spent on newspaper ads, 4% for trailers, 2% and 1% for Inter net ads--a small numbering the Web's supposed influence over moviegoers. (The MPAA has different methods of calculating spending, but the results are comparable.)

Unfortunately for the film biz, TV rates are expected to grow even higher.

With the May upfronts looming, net execs, including CBS' Les Moonves, have loudly hinted they'll drive up ad rates for the 2004-2005 TV season, with …

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