Net, Hollywood fan flames of relationship

The latest example of their mingling came today with America Online's announcement that it has agreed to feature United Artist Theater Circuit, one of the nation's largest theater chains, on MovieFone--the telephone and online movie ticket service AOL acquired in May.

"Our agenda is to establish key relationships with major players in the movie industry," said chief executive of AOL MovieFone Andrew Jarecki.

In recent months, Web and film companies have begun slowly sidling up to one another--each side wanting to attract greater shares of the other's audience. Hollywood, slow to pick up on the Internet's wide appeal, is realizing that the Net can be an effective method to fill seats in theaters.

Tinsel Town took notice last summer when the makers of the surprise hit "The Blair Witch Project" successfully tapped a grassroots market by promoting the film almost entirely over the Internet.

"That movie was the first to create a buzz online," Jarecki said. "The producers did it without marketing or advertising in the traditional media and that caught Hollywood's attention."

Since then Internet companies have been involved in other Hollywood deals. Amazon.com struck a deal with film studio DreamWorks to host cinematic home pages. Amazon created Web sites for the studio's recent releases "American Beauty" and "Galaxy Quest."

In May, AOL paid $525 million for MovieFone, the service that AOL executives say one out of every five moviegoers uses to select films.

Under the terms of the latest deal, AOL will be the sole distributor of UA's advance ticket sales and will revamp and operate the theater chain's Web site.

In return, the theater chain promises to distribute to its customers AOL's 5.0 disks, software that helps users sign up with the company's Internet services, and advertise AOL on its movie screens. Financial terms of the deal were not disclosed.