Meet the Man at Center of Dispute Over Movie Ads

If you don’t like seeing commercials before films in movie theaters, here’s the guy to blame.

His name is Terry Laughren. And these days, Laughren is spending a lot of time defending the business of the New York firm of which he is chairman, Screenvision Cinema Network. The company doesn’t create ads, but it is a sort of middle man that places 60-second commercials on more than 6,000 movie screens nationwide--or about one-third of all the first-run theaters in the United States.

Everything was hunky-dory for Screenvision. Then, last spring, two powerful movie studios, Walt Disney Co. and Warner Bros., said they would stop offering movies to theater chains that aired ads before their feature films. Since that time, Laughren has been in celluloid hell.

Laughren, however, says he hasn’t lost any big clients. But he has no idea how many potential clients he’s missed because of the flap. Meanwhile, Laughren is trying to persuade his biggest clients--such as Toyota, General Motors and the U.S. Marine Corps.--that most people actually like to see well-made ads in movie theaters.

Disney, however, says the idea that people like pre-movie commercials is just so much pixie dust.

“Mickey Mouse is really a rat in disguise,” said Laughren, whose 15-year-old company tonight is co-sponsoring the Los Angeles screening of the International Advertising Film Festival at the Director’s Guild of America. “If Disney shouts down ads before movies, then what’s your alternative as an advertiser?” he posed. “You have to go to product placement in films, and that’s Disney’s specialty.”

Indeed, Disney has recently stepped up its efforts to persuade advertisers to pay for their products to appear in Disney-made films. The film “Days of Thunder,” for example, was littered with product placements.

Disney executives declined to comment on Laughren’s criticism. But company spokeswoman Denise Greenawalt said that while ads before films are commercialism, product placement “is an artistic choice.”

Disney’s argument: while moviegoers rarely boo when product placements appear on the screen, a growing number of people are booing, hissing and even moaning when two and sometimes three commercials are shown before films at some theaters.

Surveys show conflicting results. Disney hired a research group in March that asked nearly 19,000 moviegoers if they objected to commercials in movie theaters. About 90% of them said they did. But Screenvision points to its own monthly poll of moviegoers that indicates only 4% object to Screenvision ads after they had seen them.

Advertisers pay Screenvision up to $650,000 just to have their often-extravagant spots air for one month. And that doesn’t include the ad production costs that often exceed $1 million. Screenvision then splits about half of its profits with the exhibitor, Laughren said.

Laughren insists that complaints from consumers are few. He gets about six or seven angry letters annually from the estimated 450 million viewers who see Screenvision ads. “I go to movies all the time,” said Laughren. “And I’ve never heard a commercial booed.”

Of course, Laughren admits he has not attended screenings in Westwood Village, where some student moviegoers have even been known to howl at paid advertisements. But these days, it isn’t just college students who are objecting to ads on the screen.

“You don’t need to be a leading educator to know that audiences reject commercials in theaters,” said Richard Walters, a screenwriter and associate professor at the School of Theater, Film and Television at UCLA. “If there is time for a commercial, most people would rather see a cartoon or a short subject.”

Said Arnold Fishman, chairman of the Los Angeles advertising research firm Lieberman Research West, “Commercials in theaters may actually create some adverse reaction to the advertisers,” said Fishman, who noted that his firm has not researched the issue. “The problem isn’t that the ads are good or bad. The problem is that they are there at all.”

Those who advertise, of course, have a different point of view. Toyota, for example, is one of Screenvision’s largest customers. Every year, the company buys one month of commercial time in theaters that show Screenvision ads. “An ad in a movie theater can show off a car better than anything,” said Joe Cronin, chairman of the Torrance agency that creates ads for Toyota, Saatchi & Saatchi DFS Pacific. “But this year we did look at the issue more carefully.”

The Los Angeles Times also has no plans to change its policy of placing ads on 1,000 movie screens in Southern California. “We feel they work well for us,” said Laura Morgan, a spokeswoman. “It’s entertainment produced specifically for an audience that goes to films.”

That, says Laughren, is his point. “Nobody likes commercials,” he said. “But when you see one that you like, you say, ‘That’s not a commercial, that’s entertainment.’ And that’s what our commercials are--entertainment.”