• by January 28, 2003

The future of entertainment looks digital, and World Theatre Inc. wants to be a big part of it. Imagine selecting and buying billboards, high-resolution plasma screens, and movie ads by daypart, and then being able to upload creative and send it to roadsides and theater screens worldwide. And imagine having a mechanism for easy consumer response. It’s a future that may happen within the next year or two.

The Raleigh, N.C.-based company — which also has offices on West 57th Street in Manhattan next to Carnegie Hall — is working on that future through intensive research and development efforts. It’s starting to pay off in the form of a patent pending at the U.S. Patent Office and buzz in two industries, one that hasn’t seen a lot of change in the past few decades and another that is trying to decide how best to go digital. How (and how fast) that transition takes place will affect World Theatre’s success in the management and delivery of digital film and advertisements. Another big initiative is the creation of a 24-hour digitally interactive music TV network, supported by more than just advertising and e-commerce.

“We see ourselves expanding the market for digital entertainment and advertising,” says Robert D. Summer, World Theatre’s chairman and chief executive officer and the former head of RCA Records and Sony Music International. That begins with billboards and movie screens, but it doesn’t stop there. Plans include expanding into interactive TV, cell phones, and other consumer electronics platforms, says executive vice president Randy Daniel. “Our plan is to build out an infrastructure that advertisers can begin to [use to] build a relationship with their consumers,” says Daniels, a veteran of IBM.

A key part of the equation, still to be approved by the U.S. Patent Office, is a mechanism within the advertising that will let a consumer easily reply to messages, so that advertisers can tailor a response and track metrics beyond what’s available now. Because it’s still in the Patent Office pipeline, World Theatre executives hesitate to disclose too much. But they say it will radically change the way people look at and respond to advertising.

“It will allow all advertisers across all media to become interactive without any impact on the media itself,” says Skip Ballou, executive vice president of business development. The system will be “media agnostic,” meaning it will work via a consumer’s cell phone, TV remote control, or PDA. “In the future, merchandisers will no longer be satisfied with simply branding messages. This will allow consumers to request more information on a company, buy on impulse, and give feedback,” says Ballou. It will also answer the age-old advertisers’ question: “What am I getting for my investment?”

Summer says this could change advertising. “We see here the potential for the introduction of ad revenue at a quite elevated pace, largely because of the ability to deliver the response mechanism,” he says.

More certain is the technology developed by World Theatre that would allow the movie industry to use digital delivery for its films and advertisements. Digital delivery will help prevent the problems and open theaters to digital advertising that can be bought by daypart depending on time of day, projected audience, or type of movie.

But so far, the film industry hasn’t committed to digital entertainment as much as it could. Filmmakers want screen operators to switch as soon as possible, since it would give them more flexibility and room for creativity. But many of the nation’s 35,000 screen operators are resisting because of the expense.

Working on a parallel track is World Theatre’s effort to establish the direct placement of advertisements on electronic billboards. The billboards would be sold within the 24-hour day. You could buy inventory by daypart, location, and length.

CurrentThinking — Execution
by John Gaffney

You can call it the difference between talking the talk and walking the walk. The ability to execute in a business environment sometimes gets lost in today's hyperbole about management theory and interpreting research. For a media planner/buyer, execution is more important than coffee for day-to-day performance.

Larry Bossidy is chairman and former CEO of Honeywell International. Earlier in his career he was chairman and CEO of AlliedSignal and chief operating officer of General Electric Credit (now GE Capital Corporation). He knows enough about execution to have written Execution: The Discipline of Getting Things Done (Crown Business) with Ram Charan and Charles Burck. Although the book focuses on top-level managers, it has a lot of relevant info about the media business as well.

Bossidy defines his book as an effort to “close the gap between results promised and results delivered that people in business need today.” He fills Execution with countless examples of how to focus on what a company does, not what it thinks.

“When companies fail to deliver on their promises, the most frequent explanation is that the CEO's strategy was wrong. But the strategy by itself is not often the cause. Strategies most often fail because they aren't executed well. Things that are supposed to happen don't happen. Either the organizations aren't capable of making them happen, or the leaders of the business misjudge the challenges their companies face in the business environment, or both,” he says. “The chronic underperformers ... have lots of company. Countless others are less than they could be because of poor execution. The gap between promises and results is widespread and clear. The gap nobody knows is the gap between what a company's leaders want to achieve and the ability of their organization to achieve it.”

He also takes a shot at some of the more ethereal business books and theories of the past few years: “Everybody talks about change. [However] without execution, the breakthrough thinking breaks down, learning adds no value, people don't meet their stretch goals, and the revolution stops dead in its tracks. What you get is change for the worse, because failure drains the energy from your organization.”

HotProperty: FHM
Under The Covers Lies Huge Gains for Ad Pages.
by John Gaffney

Disregard, if you can, the scantily clad women that dominate the content of FHM (For Him Magazine). Beyond the blondes, boobs, and bods there is a real magazine, with a tactician behind the controls who is as good as any who has ever served the men’s market. FHM has racked up a year other publishers dream about.

“I know how to sell to men,” says publisher Dana Fields. “The belief used to be that young men don’t read magazines. The belief was that they read vertical-content magazines only, like sports, entertainment, sex. We proved that wasn’t true. We put it all under one roof and made it work. Our editors don’t edit for their friends at Elaine’s. They edit for the magazine’s audience.”

Dana Fields should be a familiar name to you. She took Rolling Stone to its highest levels of circulation and sales as group publisher for Wenner, and she also put Men’s Journal on the map. Her performance at Wenner was outstanding, but her stewardship at FHM, an emap magazine, has found a new level. Quite simply, FHM’s stats for 2002 are better than any of its cover models’ measurements.

Start with ad pages and revenue. Fields started the year clocking a 98% jump in ad pages for the Jan./Feb. issue. April was up more than 90% as well. When the dust clears on 2002, FHM will have logged four months of 50%-plus increases in ad pages. For the year, Fields expects it to end at a 38% page increase and an 85% revenue increase. Circulation ended 2001 at 750,000. It will end this year at 1.07 million, with 462,569 of those sold at newsstands.

FHM’s competitive set comes from two categories. The first is the other books that go directly at young men, Maxim, Stuff, and Gear. The second set is the books that skew a bit older or aim at a segment of the men’s market. GQ, Esquire, Rolling Stone, Men’s Health, and Men’s Journal make up this group. By staying in touch with the real-life needs and wants of the 18–34 men’s demo, Fields says, the editorial product follows a strategy of “aspirational but accessible.”

“Real guys don’t dress in $3,000 suits and expensive Italian loafers,” says Fields. “We may start an editorial layout with a very expensive Armani suit. But we’ll have a healthy dose of affordable, fashionable clothes. We’re closer to A/X than Armani.”

From an advertising perspective, Fields maintains that FHM is the “only men’s general interest magazine.” She also presses what she claims is a huge advantage in newsstand sales. That is a result of attractive covers, emphasis on promotion, and U.K. magazine culture. Emap is owned and based in the U.K. With 2002 in the books, it’s fairly obvious the independent FHM will look to expand its current brand or acquire more magazines. “We’re looking seriously,” says Fields. “Our growth has been so spectacular that we have to. I would think that expansion will probably come in the men’s market. I think FHM would rather have a brother than a sister.”

HowTo . . . Sponsor the Empire State Building Lights
That’s so 1995.
by Amy Corr

What do M&Ms, Pink Floyd’s CD The Pulse, Windows 95, and Snapple all have in common? They have all sponsored the Empire State Building lights and you never will. What once seemed like a profitable and creative way to bring money into NYC quickly backfired. This month’s article will serve as more of a How Not To than a How To. Regardless, clarifications need to be made.

Over the course of 12 months, these immensely popular brands changed the lighting on the Empire State Building to their respective colors. Then the unexpected happened. Everyone thought the Empire State Building was up for sale. Rumors continued to surface until finally a decision was made: no more corporate logos or sponsorships allowed.

The Empire State Building does change its light colors, but corporations are not behind it. And just because you back a worthy cause does not mean the Empire State Building will accommodate a lighting change for you. As Empire State Building spokeswoman Lydia Ruth puts it, “We don’t want to be known as the corporate building, or the disease building either.”

StartupCloseup: G4 Gaming Network
All football, all the time.
by Paul J. Gough

That’s the vision of The Football Network, a nascent cable TV venue that hopes to be on the air full-time beginning around when the NFL kicks off next year. And if it’s not going to broadcast live NFL games — the costly licensing rights are tied up for at least five years — TFN will be offering just about everything else in what has become America’s number one sport.

TFN started after a University of Virginia fan, Jantonio Turner, was annoyed because he couldn’t find out the UVA score while living in California. Five years later, the idea has grown into a full-fledged network that has signed programming deals and is providing radio, TV, and web content well before its scheduled launch.

In recent months, TFN has announced programming deals with the College Football Hall of Fame, the Atlantic 10 Football Conference, the National Women’s Football League, and longtime NFL announcer Pat Summerall. Even though it’s a ways from launching its own network, TFN has started a weekly syndicated radio program and regularly updates its website (www.footballnetwork.com) with the latest in pro and college news.

“Everything we’re doing now is really geared toward acquiring and creating properties for when the network starts. We want to make our presence felt ... so we’re not just selling this concept a year from now,” says Jerry Solomon, TFN’s president and chief executive officer.

TFN’s positioning is being set up right now through Web, radio, and TV outlets. “With all of these things, we can start to act as a multimedia organization, which at the end of the day is what we are,” Solomon says.

Solomon isn’t deterred by the NFL’s short season of fall and part of the winter, saying there’s plenty of football to go around. “I am not concerned about what you’d consider the off-season. The football fan is not just a football fan Saturday or Sunday. They’re a football fan all of the time,” he says.