Nontraditional advertising is becoming a more traditional piece of the business pie for commercial production companies. That’s one of the highlights gleaned from the Association of Independent Commercial Producers’ (AICP) fifth annual Survey of the Commercial Production Industry. The recently released study–which covers calendar year 2006–was independently conducted for the AICP by Los Angeles-based firm Goodwin Simon Victoria Research.
According to the study, nearly seven out of 10 (67 percent) member production house survey respondents produced “nontraditional advertising projects outside of the traditional television commercial” in ’06. By far the most common format for such projects was an Internet or broadband viral, followed by original content (branded entertainment).
Citing the 67 percent figure, AICP president/CEO Matt Miller noted, “Our members are on the leading edge of creating new forms of advertising and marketing, and are now devoting about one in six shoot days to these projects such as virals, branded entertainment and mobile content. We expect that figure to continue to grow.”
That latter expectation is shared by survey respondents. The study found that producers estimate that about 18 percent of their current billings are generated by nontraditional projects. But respondents project that by 2010, that figure will increase to an average of 38 percent of their billings.
For Miller these study findings represent affirmation that the AICP is on the right track with the work of the AICP.next committee, which was launched in ’06. Under the aegis of chairman Massimo Martinotti (who heads MIA Films), the AICP.next committee is addressing and helping to shape new business models that are needed in this evolving era of advertising and marketing communications. This menu includes new methods of compensation beyond the traditional work-for-hire scenario, extending into such areas as holding an ownership stake in content.
Indeed Miller said it is telling that production houses report that they most frequently get traditional agency broadcast agreements from ad agencies when working on nontraditional projects. In the same vein, survey respondents said they very frequently provide a standard AICP bid form when in the running to produce nontraditional projects.
This outdated way of doing business, said Miller, needs to be rethought. As earlier reported (SHOOT, 9/28), the AICP.next committee has taken on several initiatives in this regard, including developing a contract for long format interactive content covering such projects as webisodes and other fare.
That contract and other AICP.next efforts were slated to be presented to the national AICP board for discussion and consideration during its meeting last week in Los Angeles.
Other highlights
The AICP survey measures industry trends and activity in the $5 billion-plus commercial production industry. As in years past, the AICP study provided an overview of spot filming trends. Here are some other noteworthy findings of the study covering ’06:
• The aforementioned $5 billion figure was documented yet again as AICP members totaled about $2.64 billion in direct production expenditures in ’06, with about $2.16 billion spent in the U.S. and $475 million spent in foreign countries. When factoring in postproduction, talent payments and other indirect expenditures, commercial production represents a $5 billion industry.
• Eighty-two percent of all reported shoot days took place domestically, with 18 percent in foreign countries. This represents a decrease from the 23 percent of shoot days outside the U.S. in ’05 but is similar to the percentages reported in ’04.
• Canada remains the largest production center outside the U.S. for American ad lensing, capturing 36 percent of all foreign shoot days. However, the largest growth since ’02 continues to be in Central and South American locations, which have seen a rise from 12 percent of foreign shoot days in ’02 to 26 percent in ’06. This growth has come mostly at the expense of Europe, which has seen a decline from 24 percent of foreign shooting in ’02 to 14 percent in ’06.
• Southern California remains the most popular location for commercial shoots. Forty-two percent of all shoot days took place in Southern California, with New York a distant second at 13 percent. Looking at domestic shoot days only, 51 percent took place in Southern California in ’06, compared to 16 percent in New York.
• And there is still significant filming activity outside of the traditional production centers. In ’06, about 24 percent of all shoot days, and 30 percent of domestic shoot days, took place away from the major production centers of New York, Florida and Southern California.
Miller related that AICP members benefit from the independently conducted research on several fronts. “In some respects it tells people what they anecdotally know. But to be able to put numbers to it can prove useful as a business planning tool. Also, quantifying the business in a recognized methodical way gives us vital figures and information to present to legislators and public officials about the positive economic impact of our business. This leads to filming incentives and other policies that are industry friendly.”
Additionally, said Miller, the study findings help the AICP to set a relevant agenda to serve its membership and the industry at large–the AICP.next endeavors being a prime example of that.
Supreme Court Allows Multibillion-Dollar Class Action Lawsuit To Proceed Against Meta
The Supreme Court is allowing a multibillion-dollar class action investors' lawsuit to proceed against Facebook parent Meta, stemming from the privacy scandal involving the Cambridge Analytica political consulting firm.
The justices heard arguments in November in Meta's bid to shut down the lawsuit. On Friday, they decided that they were wrong to take up the case in the first place.
The high court dismissed the company's appeal, leaving in place an appellate ruling allowing the case to go forward.
Investors allege that Meta did not fully disclose the risks that Facebook users' personal information would be misused by Cambridge Analytica, a firm that supported Donald Trump 's first successful Republican presidential campaign in 2016.
Inadequacy of the disclosures led to two significant price drops in the price of the company's shares in 2018, after the public learned about the extent of the privacy scandal, the investors say.
Meta spokesman Andy Stone said the company was disappointed by the court's action. "The plaintiff's claims are baseless and we will continue to defend ourselves as this case is considered by the District Court," Stone said in an emailed statement.
Meta already has paid a $5.1 billion fine and reached a $725 million privacy settlement with users.
Cambridge Analytica had ties to Trump political strategist Steve Bannon. It had paid a Facebook app developer for access to the personal information of about 87 million Facebook users. That data was then used to target U.S. voters during the 2016 campaign.
The lawsuit is one of two high court cases involving class-action lawsuits against tech companies. The justices also are wrestling with whether to shut down a class action against Nvidia.... Read More