MARKET RESEARCH

Branding is your goal, and we offer you a multitude of tracks to reach that destination.  We all have to

admit that the economic horizon is a little cloudy right now, but history is clear that during economic

downturns the entertainment industry fairs well.  If you add the fact that right now the Digital age is in

a huge beyond historic boom, and that because of the Internet and the digital age, billions of dollars

are being pulled from the traditional media outlets such as print, newspapers, radio, and television

and being placed in the new Internet and digital formats, we got you covered there.

Two months after our Film Festival U.S. television stations will complete their transition to an all digital

system. And with the transition comes great potential to increase breadth and capacity of program and

service offerings. Broadcasters, advertisers and programmers across all platforms are scrambling to

figure out how their business will change on February 17, 2009.  With this the Digital Film Festival we

will take you there.

Hope you can take some time to read our MARKET RESEARCH, and take

a view into where the future is now.

ONLINE ADVERTISING

AD BIZ POISED TO ENTER NEW FRONTIER--Advertising dollars that routinely would have gone to
broadcast TV in years past are now going to cable and interactive television, the Internet and even
non-traditional approaches like event marketing and public relations.  "Cable was just coming out, you
didn't have the Internet--today, it's very, very difficult because the audience is so fragmented you can't
gather a large number of bodies easily," said Burtch Drake, president of the American Assoc. of
Advertising Agencies.  And a move towards branded entertainment and product placement is the
industry's way of finding new approaches to reach consumers...Media Vest's Desmond seea a new
landscape beginning to take hold within the next 18 to 36 months.  "The reality is that consumers or
strategically based planning decisions are going to do more to change the traditional TV marketplace
than anything we've seen in the last 20 years," she said.  New technologies like the Internet, video on
demand and digital video recorders are changing the TV business every day.   Shoot Magazine 10/07

Research indicates that traditional advertisers are also more apt to experiment with different ad formats.
The $2.7 billion search advertising market is booming, and Li says it will grow to $5.6 billion by 2008.

Newspapers And Local Home Magazines Losing Real Estate Advertising To Web

Not surprising the Internet is seen as the bright light in this ultimately mediocre advertising forecast. While newspapers, magazines and radio advertising are expected to lose share, "Worldwide Internet ad spending will climb to $44.6 billion from about $36 billion, increasing its share of the market to 9.4% from 8.1%," according to the ZenithOptimedia report.    

Dec 07  www.mediapost.com

TV stations could see tougher times if one research company's advice is heeded. BIGresearch, a Worthington, Ohio-based consumer research company, says top automotive advertisers are spending too much on TV compared to the influence that TV has with its consumers. It says 17% to 18% of consumers are influenced by TV marketing--but in aggregate, automotive makers spend 40% of their media on TV.

For example, Ford Motor had 41% of its media budget going to TV, according to the researcher, with 18% of its consumers influenced by TV. All other media spending figures show that Ford under-spends, compared to their influence. BIGresearch says 16.5% of Ford's customers are influenced by newspapers, but that Ford only spends 5.9% of its media on newspapers.

With the Internet, 8.4% of Ford's consumers are swayed by Internet sites--but Ford only gives that media 3.9% of its media dollars. Radio brings 6.7% influence, but 1.5% of media spend. Outdoor sits at a 12% influence rate, but Ford only gives it 1% of budget.

The Internet has opened up what is being called “The Wild Wild West” of TV and movies again. It's
almost like the old hay-day of movie studios where anything goes. For all of us who missed our
chance the first time around, by not being financially conscious of the possibilities, the Internet re-
minds all of us that everyday there are new possibilities and new opportunities.

Simply stated, the Internet is the biggest business in the history of the world. It's bigger than the movie
business, television business, and record and radio business, and it is growing faster than any of the
above and is creating a paradigm shift in the way that people are entertained, the way they buy their
entertainment, and purchase goods and services.  Man is experiencing a cultural and economic para-
digm shift.  History will continue to be written for then next few years.  Now that the dust has settled
on the Internet front, we are seeing another huge growth period, especially in the online music, film and
the purchasing of these mediums go to the Internet in mass with pay per view, VOD, streaming, and more.

BIG _{+ FOR OUR SPONSORS IS THE FACTS REGARDING DOCUMENTARIES:}

VARITY MAGAZINE SAYS: The Film Festival Summit has seen its attendance double every year

as orgs look to cash in on the festival craze.  The stakes are high and the payoff can be big.  Toronto's

Piers Handling says, "The festival brings the kind of spending to the city of Toronto that is only bested by

Christmas."

HOLLYWOOD REPORTER--REPORTS  "DOCUMENTARIES HOT ITEMS AT SUNDANCE"

This years documentary slate at the Sundance  Festival, was according to many veteran attendees,

on of the strongest in recent memory...This years edition of the country's premier festival of indepen-

dent film will be remembered for documentaries, most of which will sind up on television in the next

12 to 18 months.

USA TODAY REPORTS-- It is clear that Docs are big, Documentaries that came out on DVD are

beginning to show up in theaters.  Hollywood is taking notice, and studios are scouring film festivals for

documentaries with breakout potential.  "Documentaries have arrived as a potent MOVIE force.

USA TODAY--There's definitely a sea of change afoot both in the music and film industry.  there may be

two parallel phenomena, but they are working together very well...the reason is simple, audiences are

starved for quality music...Bob Smeaton, director of FESTIVAL EXPRESS and THE BEATLES

ANTHOLOGY,  If music lovers miss a film in the theaters, and so many don't even make it there, he

says, they can still buy the DVD and get the full length version in surround sound on home theater unit."

MUSICAL DOCUMENTARIES: A CRESCENDO OF FILMS, DVDs

THE SURGE OF INTEREST IN DOCUMENTARY FILMS HAS TAKEN A TUNEFUL
TWIST AS FILMS ABOUT MUSICIANS AS DIVERSE AS JANIS JOPLIN AND JQAY
ZARRIVE ON MOVIE SCREENS AND ON DVD TO INCREASING ATTENTION FROM
MOVIE AND MUSIC FANS ALIKE...

MARCH 2008, BILLBOARD MAGAZINE HAD

SIX MOVIE SOUNDTRACKS IN THE

TOP 30 OF THE BILLBOARD TOP 200

Retreating somewhat from earlier optimistic predictions, newspaper publishers and analysts now say next year will probably be just as tough for the troubled industry as 2007. With shareholders staking their hopes on a turnaround in 2008, this is bad news for newspaper stocks--Just this

Among Teens, a Content Creation Revolution
San Francisco Chronicle
Social networking sites are inciting more teens to create content online. According to the Pew Internet & American Life Project, nearly two-thirds of online teens have created something, from personal Web pages to online videos. The study credits social networks like MySpace and Facebook with furthering the trend. More than half of the survey's respondents said they have a social networking profile.

In the more than 80 metropolitan markets surveyed by Media Audit, a recent study shows that those who are over age 50 with incomes of $50,000 or more (the "graying and affluent") have increased from 17.0 million in 2004 to 22.3 million during the past five years. Collectively, the markets surveyed have an adult population of approximately 142 million.

Bob Jordan, president of International Demographics, producer of The Media Audit, said "Since 2004 the percentage of  ‘graying and affluent' households has increased from 13.1 percent to 15.7 percent of all households in the markets (surveyed)... (and) this group is very rapidly embracing the internet as a shopping medium."

In the prior survey, 50.2 percent had made at least one purchase on the internet during the previous 12 months. In the latest survey, that 50.2 percent increased to 65.6 percent.

 According to Jordan, "The baby-boomers, born between 1946 and 1964, began impacting this segment of the population in 1996, and their impact will continue to be felt through 2014."

USA Today in Feb. reported, "In tough times, nostalgia for rosier days seems to be driving a consumer appetite for retro products and design...Familiar is cozy, warm and enveloping.  And it's working better than anything else right now."  Levi, Coca-Cola, Kodak, Volkswagen and many other brands are using nostalgia to market.  "A lot of brands are going back to their roots," says Karen Marderosian, marketing director of Volkswagen, North America.

1,319,872,109 WORLD WIDE ARE ON THE INTERNET

As we blaze at warp speed into The Information Agethe way that we are entertained and the way we
live and purchase goods and services are changing right before our eyes,  marketing and merchandising
can be a very exciting and profitable game.  We are actually experiencing a paradigm shift, while it is
taking place, a very unique wave to ride...edge to cut, future to create.  It is what dreams are made of,
or that spark that men like Albert Einstein and Thomas A. Edison might have had some flash upon and
chance to ride as they created inventions that would also change mankind before their eyes.  It is said
that there are a new breed of producers that are right now be working in their garage and soon they will
own and run the new entertainment networks.

The downside. "The retail stores and traditional distributors are on a path to destruction," Leigh
says.  "The concept of a prepackaged CD is as dead as Gen. Custer."

LA Times reports DVD sales can mint studios more money from a film's DVD release than they do from the

box office.  Warner Bros. Home Video Chief, Warren Lieberfarb, says, "DVD is the largest source of additional revenue and profit ever created in entertainment in such a short period of time."  DVDs are now being shipped

by studios at about twice last years pace.  The DVD explosion is so profitable it has become one of the few

bright spots for the media industry, and at the same time the VOD (video on demand), downloads and the

mass migration of the market to watch movies on your computer, tv via the Internet,

And at the same time the Internet is evolving, while it is evolving, the paradigm shift is shifting even more and

at a faster rate than any thing in the past years we have been seeing the Internet change the music industry,

news papers, travel agencies, magazine industry and now the movie and television business will never be the same...

USA Today reports, "Emerging technology has deeply rattled lots of business models and whole indust-
ries over the centuries.  Electricity doused a booming kerosene business for lamps.  Cars overran the
buggy business.  Digital cameras is doing the same to film.  Before television took America by storm in
the 1940s, consumers had to pay for their visual entertainment...Just like personal computers in the
past decade, TV sets whooshed into the market, bringing new, mind-blowing electronic capabilities into
homes.  Before TV, people had to pay for visual entertainment.  As with file sharing and music, advert-
ising-supported TV allowed people to suddenly see news and entertainment for free.  Weekly atten-
dance at movie theaters dived from 80 million in 1946 to 12 million by 1972, according to The American
Film Industry The number of films made dropped from 445 a year in the 1940s to 150 in the 1970s.  The
studio system fell apart.  Not until the 1990s--and ironically, the boom in income from video rentals--did
the movie industry truly recover from the blow of massively free entertainment.  In other words, it took
Hollywood almost 50 years to figure out how to deal with TV.

Amazon.com shipped out more than a million copies of the new Harry Potter book, making that day
the largest distribution day of a single item in e-commerce history.  More than 760,000 advance copies
were ordered from Amazon.com's U.S. Web site, up from 350,000 for "Goblet," and orders on its over-
seas Web sites brought the total to more than 1.3 million.

News reports indicate that Federal Express is experiencing a huge rise in the value of its company
stock as a direct result of commerce on the Internet.  Powerful corporations like AT&T, Disney, General
Electric, Microsoft, MCA Universal, Sony, Time Warner and IBM are investing billions of dollars into
the Internet.  Reports indicate that there were more millionaires under thirty created on the Internet
than through all other areas of business combined throughout the entire economic history of this
country.  Amazon.com has the corporate wealth of Texaco Oil Corp.

The next big shift will occur when the vast majority of consumers no longer need computers to go on-
line and this is taking place now with mobile, the iphone and the Internet, of course.  Barbara Walters

asked Mr. Eisner of Disney a couple years back, "What is the future?"  Eisner said, "The Internet, 

and the merging of the computer and the television."

A shift that we are seeing is that the Internet companies are becoming bigger and with more capitol
than the television and movie companies.  While at the same time we are seeing the entertainment
business shift gears and now target hundreds of millions of dollars even billions of dollars into the
Internet.  Just because Hollywood has not figured the Internet out does not mean it is not happening
"Bigger than Dallas," as ole J.R. would say.

THE WRITING IS ON THE WALL...OR THE SCREEN ON THE WALL

Consumers Who Watch TV Online More Engaged Than TV-Set Watchers, Simmons Finds by Mark Walsh, Monday, Dec 24, 2007 7:00 AM ET CONSUMERS ARE 47% MORE ENGAGED in ads that run with television programs that they view online than those watched on a TV set, according to new research findings. A cross-media study by Simmons, a unit of Experian Research Services, also found that viewers are 25% more engaged in the content of TV shows that they watch online than on a TV.

Red Ink Forecast For Newspapers Next Year

Retreating somewhat from earlier optimistic predictions, newspaper publishers and analysts now say next year will probably be just as tough for the troubled industry as 2007. With shareholders staking their hopes on a turnaround in 2008, this is bad news for newspaper stocks--and may also torpedo major deals like the planned buyout of Tribune Co. by real estate billionaire Sam Zell.

Our Digital Film Festival and the Branding you will receive via the new multiplatform

avenues of the Internet and the Digital Age are not presented every day now...

don't miss getting your BRAND in our Brand-Wagon...

DISNEY TAKES BIG PLUNGE INTO ONLINE VIDEO...They are headed into the production of

shorts, VOD, and creating short form shows for the Internet. 

Los Angeles Leads Nation in HD-Capable Homes

Nielsen Co. said Tuesday that 13.7% of TV households in the U.S. are equipped with an HDTV and HD tuner capable of receiving signals in HD, while 11.3% are equipped with an HD television and HD tuner and receive at least one HD network or station.

Los Angeles has the highest penetration of HD-capable homes, or 20.4%, and New York has the highest penetration of HD-receivable homes, 17.5%.

“We are seeing profound changes in consumer behavior and we need to re-engineer our business models,” he said. “But change often needs a catalyst.  Last November we got one.”   Jeff Zucker

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