Hobbit Hype.

STUDIO BREAKS NEW GROUND IN WEB MARKETING

LAST summer, Artisan Films' "The Blair Witch Project" came out of seemingly nowhere to make more than $140 million at the box office and make heroes of the online marketers cited for much of the movie's early success.

But the Internet campaign now being waged by New Line Cinema for an upcoming fantasy trilogy dwarfs that effort.

The first installment of the "The Lord of the Rings" trilogy won't hit movie screens until the 2001 holiday season, but an online blitz the likes of which Hollywood has not yet seen is already generating more Internet buzz even than last summer's biggest box office hit -- "Star Wars: Episode I, the Phantom Menace."

New Line "is the only studio that recognizes the potential of what the Internet means," said Patrick Sauriol, who runs a Vancouver, Canada Internet site, Coming Attractions, that tracks the development of films. He has monitored fan interest in the project since it began and predicts that the first movie of the threesome, "The Fellowship of the Ring," could easily generate $150 million in ticket sales. "Conceivably, they could make back all their money in the first film."

Casting aside the traditional wall of silence that accompanies the shooting of a film, New Line, a unit of Time Warner Inc., has provided unprecedented public access to the making of "The Lord of the Rings." Instead of trying to keen what is going on behind the scenes a secret, as studios normally do, New Line is banking on encouraging online word of mouth from devotees of J.R.R. Tolkien's fantasy novels to build a groundswell of attention that will be rewarded when the first of the three films is released.

The stakes are high. The studio is spending north of $200 million on shooting all three movies over 18 straight months to make a faithful adaptation of the classic book trilogy, which was published in the 1950s. The movies ("The Fellowship of the Ring," "The Two Towers" and "The Return of the King") are scheduled to be released one year apart, the last in late 2003.

Rather than litigate to stop the two dozen-plus unofficial Web sites that have sprung up around "The Lord of the Ring" movies, New Line has gone out of its way to stay in touch with the sites. It has granted exclusive online interviews with studio executives and the director, Peter Jackson. And it has constantly updated its official Web site in an effort to harness the enthusiasm.

On April 7, New Line debuted an exclusive preview of the film on its site, including cast interviews, that was narrated by Jackson. In the first 24 hours of its release, the trailer was downloaded almost 1.7 million times, shattering the previous record of 1 million downloads for "The Phantom Menace," according to Apple Computer Inc., which co-hosted both events. It has become the single most downloaded trailer ever, at more than 30 million and counting.

"Someone joked that, if we had charged a buck apiece, we'd already have more than $10 million at the box office," said Gordon Paddison, New Line vice president of worldwide interactive marketing and development.

"We knew there was a tremendous (Tolkien) following," said Apple webmaster Doug Werner. "But the response was even more tremendous than what we anticipated."

A new promotional medium

Surprisingly, Internet marketing for movies has only recently begun to take off. Artisan's hugely successful Internet campaign to promote "The Blair Witch Project" is cited as a major reason the low-budget movie was so successful. This summer, News Corp.'s Twentieth Century Fox recorded the biggest July opening ever with "X-Men," in no small part due to its efforts to harness the cult following of the Marvel Comics mutant superheroes through Internet tie-ins and promotions.

Based on pre-release tracking data, Fox executives had predicted the movie would have a $30 million to $35 million opening. Instead, it took in $54.5 million its first weekend, and has now generated more than $150 million in ticket sales.

"They had a great opening because of the Web," said Sauriol, who adds that if Fox had started promoting the film online a year in advance instead of just several months, "X-Men" would have been an even bigger hit. He praises New Line for getting out of the gate as soon as possible.

Of course, that strategy does have its risks. It's possible all this romancing of die-hard Tolkien fans so far in advance could create unreasonable expectations when the movie opens -- something many observers say was the case when the much-hyped "Phantom Menace" finally debuted to less-than-stellar reviews. And launching a promotional campaign for a movie years before it opens seems a tad excessive. Is overkill possible?

"Absolutely, it certainly is," Paddison said. "We can show where you lead the horse to water, but we can't make it drink."

But he and others point out that the campaign for the general public's eye won't start until this year's holiday season, when the first trailer will be shown in movie theaters around the country. Meanwhile, keeping the Tolkien fanatics as informed as possible is much better than trying to keep them in the dark and risking their wrath.

Creating a community

In promoting the films, New Line recognized early on that there are legions of Tolkien fans who are extremely protective of the novels, which have sold more than 50 million copies and been translated into more than two dozen languages. Dissertations have been written about the Elves, Orcs, Ents and Balrogs that inhabit the world of Middle Earth that Tolkien created in the trilogy and its prequel, "The Hobbit," published in 1937. There are hundreds of Web sites devoted to the books, their author (an Oxford University professor of Old English who died in 1973), and the characters he created.

Rumors that one or more "Lord of the Rings" movies would be made have circulated for years. Needless to say, the announcement that New Line would make the movies and attempt to give them the epic quality of the books was greeted by Tolkien addicts with enthusiasm, but also anxiety over how faithful the adaptation would be.

Recognizing that the Internet would fuel all sorts of speculation -- particularly given that heavy Internet users are from the exact demographic group that tends to be attracted to Tolkien's novels -- New Line quickly set up its official Web site in May 1999, even though the films' production was still months off and no one but the director had signed on to the project. Starting with little more than an online press release, the site has undergone several upgrades and is due for another one in the next few months. Along with the trailer, the site (lordoftherings.net) also offers the opportunity to send in questions to director Jackson, a "Lord of the Rings" history and a chat room.

The site also includes the opportunity to download a customized "Lord of the Rings" Internet browser for free, which appears as a separate icon on the user's computer screen. The downloaded browser creates a "skin," a border along the edges of the computer screen, that appears every time the user logs on. Within this border are links to the official site and various fan sites chosen by New Line. In addition, everyone with the browser can send instant messages to anyone else with the browser -- all part of New Line's attempts to encourage fan enthusiasm. Since the browser debuted in February, New Line has recorded 80,000 installations of it.

"Lots of times, marketers will discount the core (audience)," Paddison said. "We haven't. They are much more important because they are the people who are going to go out and promote the film. We are heavily invested in the community around the film. We are turning the spotlight on the fans and encouraging them to create their own content."

Marketing an the cheap

Perhaps the most important aspect to all of this is how inexpensive it is. Paddison has set up cross-promotional partnerships that have reduced the studio's costs for its Internet campaign to "almost nothing." The Internet browser was developed by NeoPlanet Inc., a Phoenix-based software design firm that did the project as a promotional vehicle. The same is true for Apple and Akamai Technologies Inc., which co-hosted the Web trailer. New Line paid for the costs of using the bandwidth, but that was it.

"We've found partners to work with us for branding opportunities," Paddison said. "Apple and Akamai took out full-page newspaper ads trumpeting the success (of the trailer). If enables them to be seen as leaders in the entertainment space."