Kodak Buys Top Billing for Oscar Night’s New Home

In the largest sale of naming rights outside of sports, the Eastman Kodak Co. will pay $75 million over 20 years to put its name on a new Hollywood Boulevard theater that will permanently house the Academy Awards starting in 2002.

Neither Kodak nor developer TrizecHahn would discuss the dollar amount being paid, but sources with knowledge of the deal confirmed the terms. A formal announcement is expected today.

Although smaller than some recent sports arena and stadium deals, including the one for Staples Center in which the office supply chain agreed to pay $116 million over 20 years to put its name on the arena, it nonetheless dwarfs other non-sports deals that involve selling the right to name a venue after a corporate sponsor.

“This clearly would be at the top of the heap,” said Sean Brenner, managing editor of IEG Sponsorship Report, a Chicago-based trade publication covering corporate sponsorships.

Kodak’s deal is part of a growing trend in which the selling of name rights for huge sums of money to corporate sponsors is expanding rapidly beyond sports arenas to music amphitheaters, Broadway theaters and other entertainment venues. Developers and building owners have found selling the name rights is a lucrative way to raise money, or help cover development costs.

In March, American Airlines agreed to pay $8.5 million over 10 years to rename the historic Selwyn Theater on New York’s 42nd Street. In Southern California, corporations such as Verizon Wireless and Blockbuster Video have name rights to popular outdoor music amphitheaters.

For the venerable photography and technology company, a Kodak Theater provides exposure to the hundreds of millions of television viewers worldwide who tune in annually to watch the Oscars. In the U.S., the Oscar telecast usually ranks second each year only to the Super Bowl in total viewers. Last year, 46.3 million people domestically watched the telecast.

It also will help Kodak exploit its historic link as a supplier of film and equipment to Hollywood dating to the entertainment industry’s earliest days, as well as help the company to reinforce its image as an important player in Hollywood’s digital future.

The venue at Hollywood Boulevard and Highland Avenue will be the first permanent home for the annual Academy Awards in the event’s 71-year history.

The ceremony lately has alternated between the Shrine Auditorium and the Dorothy Chandler Pavilion. In the past, other sites such as the Biltmore and Ambassador hotels have hosted the Oscars, as have the Santa Monica Civic, the Pantages Theater and what is now Mann’s Chinese Theater.

Coincidentally, the new permanent home is across the street from the Hollywood Roosevelt Hotel, where the first Oscars were handed out in 1929.

The theater, to be equipped with state-of-the-art technology for TV broadcasts, is the glitzy cornerstone of a massive hotel and commercial development now valued at $567 million that Los Angeles city officials hope will revitalize Hollywood. The project has a new Metro Red Line stop, will include numerous shops and also will feature a television studio visible from the street similar to ones that have become popular around Times Square in New York. The project is being built by the development arm of Canadian real estate giant TrizecHahn.

Lee Wagman, president of TrizecHahn Development Corp., said the company from the start planned to sell the name rights to the theater to make the project more economical, and still plans to sell the rights to name other parts of the project, such as a ballroom that will host the Governors Ball, the annual party held immediately after the Oscar ceremony.

Although the theater will open late next year, the first Academy Awards ceremony is scheduled for March 2002.

Wagman said that in addition to the Oscar ceremony, numerous other events such as television specials, holiday events and possibly other awards shows will be scheduled at the theater. Under an agreement with the Academy of Motion Picture Arts and Sciences, which holds the Oscar ceremony, no other film awards can be held at the theater.

“If you want an analogy for this, it’s Radio City West,” Wagman said, referring to New York’s famous auditorium.

Wagman said there were five other companies that were interested in the name rights before Kodak won out, but declined to name them. A separate source identified Motorola Inc. and Blockbuster Video as two companies that at one point expressed interest. Wagman added that the motion picture academy will not benefit financially from the Kodak deal, but officials were advised and gave it their blessing.

The image-conscious academy had the right to pre-approve companies that could buy the name rights but had no direct involvement in negotiations. Academy President Robert Rehme said that the academy is pleased Kodak won out because the company is closely linked to Hollywood, unlike Staples and sports.

“I doubt there are many basketball players who use office supplies in their professional work,” Rehme said. “Make that comparison to this, where Kodak is intimately involved in the industry’s artistic accomplishments. There is a definite link.”

Kodak officials noted that the company has eight Academy Awards for technical achievement and service, and that company founder, the late George Eastman, is one of only two honorary members of the academy.

Wagman and Joerg Agin, president of Entertainment Imaging for Kodak, said the naming rights is part of a broad marketing partnership in which Kodak will promote the Hollywood site as a tourist attraction.

Agin also confirmed that as part of the deal, Kodak gets another highly valuable asset: an undisclosed number of tickets to the Oscars.