Starcom Deal With Hallmark Furthers Engagement, HD Goals

Buyers Estimate Upfront Pact Is Worth $10M-$15M

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NEW ORLEANS (AdAge.com) -- Starcom and Hallmark Channel have sealed one of the first upfront deals of the season, following last week's $300 million kids pact between Nickelodeon and Group M. The deal includes Hallmark Channel, Hallmark Movie Channel and Hallmark Channel HD.
Hallmark's new HD channel joins a roster of other HD networks Starcom will be cutting deals with in the industry's first HD-dedicated upfront.
Hallmark's new HD channel joins a roster of other HD networks Starcom will be cutting deals with in the industry's first HD-dedicated upfront.

"The continuation of our long-standing relationship with Hallmark supports many important goals for Starcom, including the further pursuit of HD solutions and of options that account for increased engagement. We are confident this will advance our agenda of customized solutions for our clients," Natalie Conway, senior VP-cable activation director for Starcom USA, said in a statement.

Bill Abbott, Hallmark's exec VP-ad sales, said, "We are very pleased to once again be partnering with Starcom to create some unique and innovative concepts to advance their clients' advertising messages. As the leader in C3 and audience retention, Hallmark Channel and Hallmark Movie Channel HD have the ideal environments for Starcom clients, and specifically deliver the Baby Boomer demographic that so many advertisers are now seeking." (C3 refers to ratings for shows viewed either live or up to three days later on a digital video recorder.)

Deal estimated at $10-15 million
Spokespeople for Hallmark and Starcom could not comment further on the terms of the deal, which is valued by cable buyers to be worth between $10 million and $15 million.

The deal comes on the heels of a record ratings year for Hallmark, which finished 2007 as one of the top 10 highest-rated cable networks in total viewers, albeit with a median age of 64. Reaching high volumes of the older audience has pushed the network to target its advertising efforts to boomers, who are attractive to some marketers for their spending power and their commercial engagement. Hallmark often ranks among the top three cable networks with the highest commercial retention indexes in C3 ratings. The network also saw ad revenue increase past the $200 million mark for the first time last year, according to Kagan estimates.

Hallmark's new HD channel, which launched in the spring, joins a roster of other HD networks Starcom will be cutting deals with in the industry's first HD-dedicated upfront. The agency has also been negotiating with other HD players such as Discovery Networks, HDNet, HDNet Movies and Universal HD, based on set-top-box data from DirecTV and Charter L.A. using second-by-second audience measurement.

Uncertain buyers
As for the rest of the cable upfront marketplace, it could take a few more weeks, or even months, for the majority of deals to start moving. Broadcast buyers were still uncertain about the shape of the upfront market, with recession-based cutbacks from marketers and the lack of completed pilots from the broadcast networks contributing to delays in deal-making.

The Turner networks, which held their presentation during broadcast upfront week May 14, expect to see the majority of their business moving simultaneously with the broadcast networks, but have already cut a few branded-entertainment deals with clients such as Dodge and AT&T. ESPN, which also presented during broadcast upfront week, has completed a handful of smaller deals, but typically sells during the sports upfront, which doesn't kick off until broadcast business wraps.
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