Cannes can peek at ad future in Fallon's BMW Films work

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Predictions on Cannes winners can be found elsewhere in this issue. I'd like to focus on two sure International Advertising Festival losers: 1) the BMW Films campaign from Fallon Worldwide; and 2) advertising's creative community.

BMW Films may win Lions in the cyber and media categories in which it is entered. It will not take home a film prize because it did not qualify for entry in that key category.

Every awards show this season debated whether to allow the BMW Films series to enter and, if the answer was yes, in what categories. The levels of respect granted the work varied. (It was tossed out of one show and took the top prize in another.) The debates seem like trivial disputes. But there is a lot riding on the outcome for an industry whose continued viability depends on its ability to adapt to a marketplace transformed by technology.

David Lubars, president-executive creative director of Fallon, smartly challenged skeptics during a recent Association of Independent Commercial Producers panel discussion in New York. "The question isn't, `Is it advertising?"' Lubars said. "The question is, `What is advertising?'" Or, more specifically, what advertising will become in the world of TiVo and the personal video recorder.

There are those who believe the PVR threat is overstated, that it's the height of folly to again declare the death of the 30-second spot. Their skepticism is based on the low penetration of PVR technology in U.S. homes. But they're wrong to underestimate PVR potential.

In a few years, the technology will be built into cable boxes and TV sets, significantly increasing household penetration. Early studies and anecdotal evidence indicate such devices dramatically alter media-consumption habits. Most viewers use the technology to time-shift programs; many click past commercials some or all of the time. I have yet to meet a TiVo user who doesn't admit to skipping ads. "You have to get it," they say, incredulous that I haven't.

At critical mass, there are staggering economic consequences for media companies and a challenge to advertisers' ability to market products and services. There is no task more crucial to advertising creatives than puzzling out what form marketing messages will take in a TiVo world.

The industry's first, tentative answer has been to integrate marketing messages into programming. This marriage of content and commerce has clear danger zones. Because the ad industry isn't well acquainted with restraint, many ugly children will result from the Hollywood-Madison Ave. union. But there are opportunities to get it right and in the process create a new advertising model.

BMW Films, short Internet movies helmed by big-name Hollywood directors, is an example of that. BMW did not weave its cars into the plot of a network sitcom shoved in front of passive viewers. It created a series of films and allowed them to compete on their own as entertainment options for consumers. This is a fundamental rethinking of the model, with the audience seeking the ad instead of the ad seeking the audience.

As new models emerge, content-commerce convergence will take many forms, from product integration to stand-alone entertainment to funding by marketers of content deemed appropriate for their ads.

As with any new technology, the only certainty is that no one has a clue what an ad will look like in five years. Until we do, let's at least celebrate and reward innovation, not punish it. "We're being penalized," Lubars told me, "for not fitting into a box that's supposed to celebrate out-of-the-box thinking."

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