Broadcast Upfront Sales Nearly Done

Initiative Complete Except for CW

By Published on .

NEW YORK (AdAge.com) -- The broadcast upfront is whirring to a finish, with at least one major agency, Initiative, nearly complete and several midlevel agencies confirming they are nearly done laying down their network dollars.
Most upfront deals between networks and buyers were done using the live-plus-three metric, though several nets have reportedly been willing to conduct live or live-plus-one deals in certain dayparts such as daytime and late night.
Most upfront deals between networks and buyers were done using the live-plus-three metric, though several nets have reportedly been willing to conduct live or live-plus-one deals in certain dayparts such as daytime and late night.

A spokesperson for Initiative confirmed the agency was done with its upfront save for the CW. The WB/UPN hybrid is expected by many to wrap up business later this week once it settles on an agreeable cost-per-thousand-viewers metric. Group M is also believed to be done doing business with ABC as of last night, said an executive familiar with the negotiations.

Live plus three is standard
Most deals were done using the live-plus-three metric, though several nets have reportedly been willing to conduct live or live-plus-one deals in certain dayparts such as daytime and late night.

One key buyer said that "pricing is right where it should be at, money being flat to down" from last year's broadcast total of $9 billion. This buyer said it was "completely believable" that Fox has finished writing all its inventory, but otherwise the buyer hadn't heard that any of the networks were writing more total dollars than they did last year.

Several agencies wrote a lot of business into the wee hours of Friday night, hoping to cash in on the momentum started by the nearly $1 billion Group M/NBC deal June 13. The day's upfront chatter frequently touched on which party was more adversely affected by the deal, with Group M expected to take a hit in subsequent negotiations with the networks by several competing buyers. Yet across all dayparts, NBC seems to have scored a coup in coming out first.

'Usually goes in reverse'
"It's an interesting dynamic," said one buyer. "Usually the low-rated guy is usually at the end of the pack and the market is kind of set and you get what's left over. NBC is almost setting the market at that level and then you went up from there. Generally speaking, it usually goes in reverse, and the other networks fall into line."

Also working in NBC's favor was the fact that the deal was brokered by No. 2 in command Marianne Gambanelli, taking the lead for sales chief Mike Pilot, who came over from the sales side at parent General Electric Co. in November 2006. "The more I think about if the NBC deal went too low too early, I think they did a really smart thing," the buyer said.

An executive close to the situation said, "It's safe to say that CBS is well on its way through about three-fourths of its upfront sales. There are about one or two major agencies [the network is] still in discussions with." CPM increases, the executive added, are in the high-single digits -- estimated by buyers to be at 8%-9%. The executive said the network is "pretty strong across all dayparts," citing particular strength in retail, pharmaceutical, financial and insurance categories.

Fox up 5%
Fox registered about 5% more revenue in the advertising upfront than last year, when it took in a best-ever $1.8 billion, Ad Age sibling TV Week reported today.

The network, No. 1 in the ratings this season in adults 18-49, is about 95% done with its deal making, executives familiar with its progress said. Fox also sold slightly less inventory than last year.

For most clients, Fox secured price increases of 7.5%-9% on a CPM basis. Comparisons are tricky because this year's deals were done using live commercial ratings plus three days of digital video recorder playback, while last year's were done on live program ratings.

Elsewhere, the buzz turned to the first cable deal between Starcom and Discovery, which was conducted using minute-by-minute data and measured using a variety of data streams based on a client-by-client basis. Discovery sales chief Joe Abrusseze said he had clients who were looking to do business based on commercial ratings, program ratings and engagement. But one key executive wondered what that meant for the rest of Starcom's cable budget.

"Starcom is so cable-heavy, if they couldn't get some of those cable networks to do commercial ratings and just do a rating CPM they could lose money on that," the executive said. "They have an issue -- if a show's ratings drop 16%, the marketers are not going to pay an increase."
In this article:
Most Popular