AFI BRAND BOOSTS VIDEO RENTALS, SALES

DAN ALAIMO

LOS ANGELES -- The American Film Institute is moving forward with film history events that are boosting video rentals and sales while establishing the organization as a national brand.

The events, this year's just announced "AFI's 100 Years ... 100 Laughs," like the past efforts "AFI's 100 Years ... 100 Movies" and this years "AFI's 100 Years ... 100 Stars" grew out of a need for funding. But the success of these programs was so great that the AFI name itself has become a well-known and useful tool for studios and retailers. More such events can be expected in the future, said Seth Oster, AFI's director of communications.

"When all is said and done, we hope that the AFI name is recognized all around this country and internationally," said Oster. "We hope that people immediately associate the AFI name with film, with all the movie image arts, and as the main national organization that serves their interests."

The AFI was created as an independent non-profit organization under President Lyndon Johnson in 1965 through the National Endowment for the Arts. It's purpose is to preserve the heritage of film and television, identify and train new talent and increase recognition and understanding of the moving image as an art form, according to AFI's web site.

Through the years, AFI relied heavily on federal funding to do all that, in addition to running film festivals and theaters, exploring new technologies, providing a forum for Hollywood and Silicon Valley to come together, representing the film community to the public and raising awareness of the nation's film heritage.

However, federal funding of AFI's $15 million annual budget was cut back from $2 million in 1996 to $200,000 in 1998, and will be reduced to $25,000 in 2000. "When funding for the arts was eliminated, AFI suffered a major hit, but we were determined to maintain our programs at the same level, as best as humanly possible," said Oster.

The organization more than succeeded. In 1998, AFI had a budget surplus, according to its annual report. "We have been very successful in the last year finding ways to cut back without impacting our programs. But what our marketing department has done so successfully is create a major national event that fulfills our mission by celebrating the first 100 years of American movies," Oster said.

The AFI "100 Years" programs involve the cooperation of all the major studios in national events that include CBS television specials, multi-million dollar marketing campaigns, and point-of-purchase materials that led to big participation at the retail level. Huge rental increases followed from the "100 Movies" event last year. For example, rentals of number one "Citizen Kane" went up 1600%, according to VidTrac data of the Video Software Dealers Association, Encino, Calif. Similar results were expected from the "100 Stars" promotion this year, said Oster.

"AFI brought a new awareness of and raised the level of dialogue nationally about American film history," he said. "People went back to see these movies in enormous numbers. We accomplished our mission, it made the studios happy and it gave retailers a chance to use their libraries in new ways, which is hugely profitable for them."

The "100 Movies" event also brought controversy as experts and consumers debated the choices. "The criticism was of the list; I never heard any criticism of the process. But the controversy that enveloped us last year was one that we raised, that we welcomed, that we hoped for. We in effect designed for that to happen," said Oster.

While video specialty stores have taken great advantage of the programs, they also have strong potential for supermarkets. "When you look at the level at which videos are being rented and bought in supermarkets now in this country, and you consider how successful this program has been with video retail outlets around the country, certainly we would hope that supermarkets would see the value in highlighting this program as well," said Oster.

"This program has a proven track record and it is continuing to be successful this year as well. So supermarkets only stand to gain in terms of their bottom line and they stand to gain from being part of a very respected successful celebration of the great art form of this century," he said.

The programs are also "entrepreneurial" in creating new revenue streams in ways that also accomplished AFI's mission of advancing and preserving the art of the movie industry, he noted. "The AFI imprimatur suggests to the public that there is sort of an integrity that they can attach to this list. It's a recommendation from the AFI, which is different than if it came directly from the studio. These programs simply celebrate the very best," Oster said.

The AFI programs also are significant in getting the hotly competitive studios to cooperate. "We have the active participation of the entire film community in this. It's normally impossible to get studios to agree on anything. But in this case, they came together and worked as one in support of this program. One of the remarkable achievements has been that AFI was able to get all these studios working together on this video program and roll it out into the stores and into the supermarkets. For the studios, they are doing well by doing good, and it supports our mission," he said.