LOS ANGELES (Reuters) - Pepsi will pay several million dollars to urban charities, heading off a threatened boycott over its decision to fire controversial rapper Ludacris as its pitchman, the soft drinks giant said on Tuesday.
The agreement came after hip-hop mogul Russell Simmons charged that the food and soft drink company unfairly yanked an ad campaign by black rapper Ludacris last year.
Simmons complained that Pepsi pulled the plug on Ludacris as a celebrity pitchman over complaints about his profanity-laced lyrics -- then hired equally foul-mouthed white rocker Ozzy Osbourne for a Super Bowl spot.
New York-based PepsiCo Inc., the Hip-Hop Summit Action Network, founded by Simmons, and the Ludacris Foundation jointly announced the settlement on Tuesday.
Under the deal, Pepsi and the Ludacris Foundation have agreed to distribute million of dollars in contributions from Pepsi to grass-roots, nonprofit organizations targeting disadvantaged youth in the United States.
Precise terms were not disclosed although a source close to the matter said Pepsi pledged less than the $5 million that Simmons had demanded last week that the company make in charitable contributions to the Ludacris Foundation.
A demand for the company to reinstate the canceled Ludacris Pepsi television ad was also rejected.
"We've come to an agreement where the common ground is young people. We're working together on a multiyear, multi-city effort that will encourage kids to express their creativity in the visual and performing arts," Pepsi spokesman Bart Casabona said in a statement.
The controversy began last year when conservative Fox News commentator Bill O'Reilly assailed Pepsi as "immoral" for featuring Ludacris and urged his viewers to boycott the beverage company. Pepsi yanked the 30-second television spot, saying it had received complaints about Ludacris' profane song lyrics.
Atlanta-based Ludacris, one of the biggest names in hip-hop's "Dirty South" movement, has earned a reputation for his explicit lyrics, including "Move Bitch," a hit featured on his 2001 album "Word of Mouf."
Even though ABC had the number one show last week with the Michael Jackson Freak Show, CBS retained its top spot in prime time ratings for the week ending Sunday, Feb. 9.
CBS led the prime-time ratings for the week ending Sunday, Feb. 9, averaging an 8.8 rating/14 share and 13.3 million viewers a night. NBC, 8.1/13 and 12.4 million, finished second, followed by ABC, 7.4/12 and 11.8 million, and FOX, 5.9/9 and 10.6 million. The WB was fifth at 2.9/4 and 4.6 million viewers, while UPN trailed at 2.4/4 and 3.6 million viewers.
Among adults 18-49, the demographic group advertisers target most, FOX and NBC tied for first with 4.9 ratings. ABC averaged 4.6, CBS 3.7, The WB 2.1 and UPN 1.6.
"We went through all of our operations only yesterday at our management meeting here and the advertising outlook for the next several months is extremely good."
That's what Rupert Murdoch had to say about the healthy second quarter performance his company is about to report.
News Corp.'s Fox Network, with it's reality series successes, are turning that networks fortunes around and is planned to turn a profit by the end of 2003.
In an article on BadAds.org, Eric and Linda bring to our attention that movie advertisers risk driving customers away with too much pre-movie advertising.
The companies that sell the advertising and the theaters themselves are doing quite well revenue-wise with this form of advertising. National Cinema Network, which places ads on a third of movie screens in the U.S., increased its prefilm commercial sales by 48 percent in 2002. During the summer, when ticket sales reach their peak, movie theater owners can earn as much as $4 million over five weeks.
With the increase in the amount and pre-movie advertising and the ridiculous number of previews that are forced upon viewers prior to the start of the movie, it won't be long before viewers begin to complain. when I go to the movies, I just plan to arrive 20-25 minutes after the start time and I am still there in time to see the beginning of the movie. How long before more people are doing this?
While I dislike the proliferation of advertising in the movie theater, it is a very captive audience and one that can't be ignored as a marketer. At some point, there will need to be limits on the number of commercials shown prior to the movie.
If this concerns you, check out Didn't I Already Pay for This Movie? It's a web site dedicated to this issue.
Al Michaels has signed a new contract with ABC Sports. He doesn't say how long the contract will last but did express a desire to stay with ABC as long as the network carries Monday Night Football.