Newspapers are increasingly losing out in the battle for shrinking movie-studio advertising budgets, a shift with important implications for papers like the Los Angeles Times and Daily News that rely on giant movie ads to bankroll their entertainment coverage.

In the L.A. market, first-quarter movie advertising across all media was down 7.6 percent, to $74 million, compared with the like period a year earlier, according to data compiled by TNS Media Intelligence.

It was worse for newspapers, which lost 12.2 percent of their first-quarter movie advertising revenue, to $45 million. Locally, the only advertising categories to gain over the past year were the Internet and outdoor advertising.

Some see this as an inexorable trend of movie studios putting their ad dollars where their youth-skewing audiences are cable and online rather than newspapers, which tend to attract older audiences.

“As the Internet generation grows up, the median age of the movie audience is going to match up with the median age of the Internet generation shortly. It really is a paradigm shift,” said Peter Conti, vice president of the media consultancy Jupiter Research Inc.

Executives at the Los Angeles Times and Los Angeles Newspaper Group which publishes the Daily News and other suburban newspapers say they are concerned but not panicking about the erosion in studio advertising.

But alarm intensified earlier this month when Walt Disney Co.’s chief executive-elect, Robert Iger, suggested that the studio was rethinking its marketing approach.

“Consumers are getting messages in nontraditional ways, and our spending has to reflect that,” said Iger in a conference call with analysts. “Consumer behavior and consumption is more fragmented and spending should be more a mix of traditional and new media.”

And a report in the LA Weekly suggested that two major studios were considering slashing their newspaper ad budgets. The Weekly story did not name the studios, and representatives of News Corp.’s 20th Century Fox, Sony Corp.’s Sony Pictures Entertainment, Dreamworks Animation SKG Inc. and Disney declined to comment or did not return phone calls.

Newspapers respond


Even if studios don’t make drastic cuts to their newspaper budgets in the near term, the spending data points to a long-term shift.

The trend is fraught with particular implications for newspapers, which rely on movies for about 10 percent of their advertising.

LANG, the Times and LA Weekly whose readership trends younger than the dailies declined to release data on how much studios spend to advertise in their papers. All three, however, acknowledged that movie advertising is a major source of revenue but one that has been falling or at best staying even.

“I think we would be remiss to take any category of business for granted,” said Jane Kahn, associate publisher of LA Weekly. “The media landscape is constantly shifting.”

The newspapers have been pushing their online versions as a vehicle for studio advertising and selling print-and-online packages as a combination buy. The Times even created “mini-sites” Web sites that pop up from the paper’s main entertainment Web site calendarlive.com to promote specific pictures.

“I think the studios right now are rethinking everything in light of the current box office (slump),” said Todd Brownrout, senior vice president of advertising for the Los Angeles Times, which is owned by Chicago-based Tribune Co. “We have the same obligation we’ve always had, which is to be relevant, to keep people in the (theater) seats and to keep them coming into the theater.”

Still, newspapers are struggling against demographic trends that make them less attractive vehicles for movie audiences, who tend to be younger than newspaper readers. Only 40 percent of Americans aged 18 to 34 even read a newspaper on weekdays, according to the consumer marketing company Scarborough Research.

Doug Hanes, senior vice president of advertising and marketing for the Los Angeles Newspaper Group, which is owned by Denver-based MediaNews Group Inc., said that for newspapers to hold onto movie advertising, they must emphasize their Web sites and interactive features such as automatic movie time listings.

LANG is emphasizing its entertainment-oriented Web portal, la.com, in conjunction with its individual newspapers and their Web sites as vehicles for movie advertising.

“There’s no question (the Web) is a major, major part of our portfolio,” Hanes said. “It’s a major strategic initiative for LANG to figure out a way to work with studios to produce whatever products and services are necessary to promote their products.”