Advertisers in Hollywood: Magna Global launches entertainment division

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First there was Magna Global, now there is Magna Entertainment. The media-negotiating unit of Interpublic Group of Cos., Magna Global, is launching an entertainment division to create TV programming.

The operation will be led by Robert Riesenberg, who moves from exec VP-broadcast and programming at sibling Universal McCann Entertainment Group to exec VP-director of Magna Entertainment. He will be in charge of creating programming for TV and video markets. But instead of just working with clients of Universal McCann, he will be working with the combined client list of Universal, Initiative Media Worldwide and other Interpublic media operations.

"Magna Global is now three things," said Magna Global Chairman Bill Cella. "It's about creating leverage in the buying marketplace. It is a knowledge-based company based on our research and data operations. And now it will also be about programming."

The elevation of Mr. Riesenberg underscores the growing importance of content production for advertisers. Magna Entertainment will not only allow Mr. Riesenberg access to a larger list of advertisers who can become production partners, but also give him access to more substantial potential funding.

Magna Global claimed worldwide billings of $39.53 billion for 2000. In the United States, billings in 2000 were $19.16 billion. Most of that money is spent on conventional advertising and marketing, but the potential is there for Magna Entertainment to wield some power in Hollywood.

Mr. Riesenberg denies there will be direct competition with traditional Hollywood studios. "Hollywood has a whole distribution system that feeds home video and international markets. We are not in that business. We are in the business of serving our clients."

Mr. Riesenberg, however, pointed out that Magna Entertainment will compete in the selling process. "When producers sell ideas to a network, the network chooses the best concepts. ... If a good idea has money attached to it, in our case, advertisers' money, the network will take a very hard look at what we have to offer."

At Universal McCann, Mr. Riesenberg put together 11 hours of shows last year for clients, including a movie for Viacom's CBS, "The Christmas Secret," in partnership with Johnson & Johnson, General Motors Corp. and Nestle USA; "Young Americans," an eight-part series on AOL Time Warner's WB network sponsored by Coca-Cola Co.; and "Lost," a reality series on General Electric Co.'s NBC funded by Johnson & Johnson, Coca-Cola, Marriott Hotels and Lowe's Home Improvement.

"We call it product integration," said Mr. Cella. "We just don't put products in shows, we put them in where they belong. For example in `Lost,' we gave [Coca-Cola's] Dasani water to contestants trekking through the desert."

Magna Entertainment is close to a large programming deal with a cable TV network. Neither Mr. Cella nor Mr. Riesenberg would reveal details. According to Mr. Cella, however, Magna Entertainment will place a special emphasis this year on developing urban multicultural programming in association with GlobalHue, a holding company for multicultural shops that's 49% owned by Interpublic.

Fast Facts

Company: Magna Entertainment

Parent: Interpublic Group of Cos.' Magna Global

Boss: Robert Riesenberg, exec VP

Former job: Exec VP-broadcast and programming, Universal McCann

Plan: Develop TV programming for marketers

Marketer's play: Own the program, advertise, product placement

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