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Vonage to Present at the Oppenheimer 20th Annual Technology, Internet & Communications Conference


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Vonage To Use Animated Character In Movie Plex Ads

Vonage In Print News

Advertisers Pour More Money Into the Big Screen

June 27, 2005

By Jane L. Levere

Vonage plans to use this character in
an animated spot in movie theaters.

HATE being stuck in a movie theater with no choice but to watch advertisements on the big screen?

Get used to it.

Advertisers like these spots, and have been buying more of them. Movie ads are one more alternative to television spots, which are losing favor as TiVo and other digital video recorders make it easier for viewers to zap them.

Last year, ads in United States movie theaters grew 23 percent to $438 million, according to the Cinema Advertising Council. The two-year-old trade association, scheduled to announce the increase today, is also expected to report that on-screen advertising revenues grew 20 percent last year to $374 million. Off-screen promotions - including revenue from in-lobby promotions - rose 41 percent to $64 million.

Matthew Kearney, president and chairman of the council, said for advertisers, movie theaters provide an attractive alternative to television.

"They are discovering theaters deliver a quality audience and an ideal canvas for their message, and that they are extremely effective in a quantifiable way," he said. "Our medium can demonstrate reach, frequency and recall, all of which lead to a very good return on investment."

More than 27,000 of the total 37,000 movie screens in the United States run cinema advertising, said Mr. Kearney, who is also chief executive of Screenvision, a cinema advertising company that is a joint venture between ITV and the Thomson Corporation.

In the first quarter of 2005, 50 percent of United States moviegoers were between the ages of 12 and 34 and a third were 12 to 24, according to Nielsen Cinema. The education levels and spending power of those in the movie theaters are attractive to marketers, too. In 2004, 35 percent of all moviegoers were college graduates or more highly educated, while their median household income was $66,000, according to Nielsen.

One proponent of cinema ads is Neil Ascher, an executive vice president of Zenith Media, a unit of the Publicis Groupe. "With all the fragmentation of media, agencies are constantly trying to find ways to connect with customers," he said. "Cinema advertising is another opportunity, particularly if you have younger targeted brands. It's also begun to be used for more traditional packaged goods, because you get an element of surprise people don't expect to see."

One national advertiser that will use movie theaters this summer is Gillette's Oral-B brand, which has commissioned a cinema ad - the first by any Gillette product - to promote its new Pulsar toothbrush, which has special bristles that pivot to clean teeth.

Marc Gibeley, vice president of new products for Oral-B, said the cinema spot, created by BBDO Worldwide, a unit of the Omnicom Group, let Gillette showcase the new toothbrush's technology "on a big screen, where it will have amazing visual impact."

Mr. Gibeley said the new 30-second spot will run in theaters for one month starting July 1.

Another cinema advertiser this summer is to be Vonage, the broadband phone company based in Edison, N.J. It is to run a special 30-second animated spot by Arnold Worldwide, a unit of Havas, on a trial basis in movie theaters in Denver and Boston in August.

Caroline Finch, Vonage's director of marketing, said, "Cinema is a good fit for us creatively, because people go to the movies and are sitting there waiting to be entertained."

These supporters notwithstanding, there are some clouds on the horizon for cinema advertising. In recent months, movie attendance in the United States has been declining, a trend that could make cinema advertising a less attractive medium.

As of the weekend that ended June 19, box-office receipts were down year-over-year for 17 weekends in a row, despite the recent blockbuster openings of the final "Star Wars" installment and the latest "Batman" film.

Nor are all moviegoers enamored of being bombarded by commercials; many say they resent being treated like a captive audience.

Since the beginning of this year, consumer opposition to the screening of movie ads has led government officials in Connecticut, Illinois and New York City to introduce bills that would require theater owners to post, in all advertising, actual starting times for trailers and commercials, as well as for films. No bill has been passed yet.

In May, Loews Cineplex Entertainment said it would put a note in ads on a trial basis for its two theaters in Connecticut that "the feature presentation starts 10 to 15 minutes after the posted show time." It also said such notices would run next in New York City, where it has 11 theaters, and elsewhere nationwide. The company denied this move was in response to the introduction of bills in Connecticut and New York.

But a spokeswoman said this trial was now on hold because of the planned merger between Loews Cineplex Entertainment and AMC Entertainment announced last week.

State Representative Andrew M. Fleischmann, the Democrat from West Hartford who proposed the Connecticut bill in January, said last week: "My proposal for simple disclosure would not be at all burdensome for the industry. I have constituents who are so exercised they're asking to ban movie advertising. I'm hopeful theater operators will listen more closely to customers. There are reasons movie attendance is dropping, and excessive advertising is definitely one of them."

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