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AS LIQUOR ADS HEAD TOWARD TV, FEAR AND BEER STAND IN WAY;SEAGRAM-AFFILIATED CABLE NETWORKS ALSO ARE ON THE LINE ON THIS ISSUE

By Published on .

The tradition of not carrying hard-liquor ads on national TV goes back decades, but House of Seagram, in its carefully crafted campaign to break through, might have a winning card yet to play.

Parent Seagram Co. owns 50% of both the USA Network, in 68 million homes, and the Sci-Fi Channel, beamed to 33 million households, via its MCA entertainment company.

"We currently have a ban on hard-liquor advertising," said John Silvestri, exec VP-advertising sales for USA Networks, which includes Sci-Fi. "But if Seagram came to us with a hard-liquor ad, we'd have to look at it. I'd imagine we wouldn't run anything before 10 p.m." ET.

NO BUYS SOUGHT YET

Mr. Silvestri said that thus far Seagram had not approached either network about running a liquor ad, and it should be noted that USA Networks President-CEO Kay Koplovitz chaired a cable industry committee in the 1980s that decided cable networks would follow the voluntary broadcast ban on liquor advertising.

"We don't get directions from our parent companies on issues like this. It would require us to change our policy, and that's not something we're looking to do," Ms. Koplovitz said.

With that reaction from a sister company, the chances Seagram can convince ABC, CBS or NBC to allow spirits ads is practically nil, and the reason is spelled b-e-e-r.

TOO MUCH OF A GAMBLE

"Beer is much too important a category for the networks for them to risk taking hard-liquor ads," said one TV industry executive who asked that his name not be used. "Beer is especially important to the sponsorship of sports on the networks."

Beer and wine advertisers spent about $380 million on network TV last year, according to Competitive Media Reporting, and the vast majority of that total was spent by beer companies.

All of the broadcast networks say they are sticking to their decades old policies of banning hard liquor advertising. Likewise, TV station rep executives and a number of TV station group chiefs, as well as several major cable TV network managers, have told Advertising Age that with the exception of a few maverick TV station owners, small cable networks (or the USA Networks), it's unlikely the U.S. will be seeing whiskey ads on TV any time soon.

So why was the House of Seagram so eager to publicize the fact that it is running commercials for Crown Royal Canadian whiskey on KRIS-TV, an NBC affiliate in Corpus Christi, Texas, the 128th largest market in the country?

One view, according to number of TV executives, all of whom requested anonymity, is that Seagram sees itself in a win/win situation. If it can convince the networks that there will be no political backlash on the beer front, then it can start to advertise in earnest, and get on an even playing field with beer.

Alternatively, if Seagram can generate enough heat so that Congress starts to seriously consider limiting or severely banning beer ads, Seagram also levels the playing field. Seagram's only beer products are two microbrews it's testing, Devil Mountain and Coyote.

"Right now there is a delicate balance in Washington regarding alcohol ads on TV," said one of the TV executives. "The status quo, where we have beer and wine ads, but not hard liquor commercials, is working. I don't think [Rep. Joe] Kennedy's legislation is going anywhere as long as the status quo is maintained. So no one at the networks wants to upset the apple cart."

Local TV stations also want to protect beer spending, which came to $189 million in their markets last year, according to CMR.

Furthermore, "Most of the local TV station owners have two other issues in Washington of great interest to them, mainly the questions of mandated children's programming and spectrum fees, and they don't need the headache hard liquor ads would certainly draw from organizations like Mothers Against Drunk Driving," said an executive of a TV trade organization.

Indeed, after Seagram announced it was running the ads on the Corpus Christi station, MADD issued a statement saying it was "concerned that the Seagram spots will open a floodgate for similar alcohol advertising that is appealing to youth, since industry competitors will hardly be able to stand by and allow one company to monopolize the airwaves."

As for Seagram itself, an executive close to the company said there is a media plan for more commercials.

Early indications had been that Seagram had plans to run ads for another brand.

"Seagram had been talking to us about running Captain Morgan" rum commercials, said T. Frank Smith, owner of KRIS-TV. "In fact, that's what we thought we'd be starting with."

"We're not going to do that at this time," said Arthur Shapiro, Seagram's exec VP-marketing services, discussing Captain Morgan. Seagram has also considered creating and running broadcast ads for Chivas Regal and Absolut vodka. But TV outlets for those ads remain scarce for the forseeable future.Mbeer companies.

All of the broadcast networks say they are sticking to their decades old policies of banning hard-liquor advertising. Likewise, TV station rep executives and a number of TV station group chiefs, as well as several major cable TV network managers, have told Advertising Age that with the exception of a few maverick TV station owners, small cable networks (or the USA Networks), it's unlikely the U.S. will be seeing whiskey ads on TV any time soon.

A WIN-WIN PROPOSITION

So why was the House of Seagram so eager to publicize the fact that it is running commercials for Crown Royal Canadian whiskey on KRIS-TV, an NBC affiliate in Corpus Christi, Texas?

One view, according to a number of TV executives, all of whom requested anonymity, is that Seagram sees itself in a win/win situation. If it can convince the networks that there will be no political backlash on the beer front, then it can start to advertise in earnest, and get on an even playing field with beer.

Alternatively, if Seagram can generate enough heat so that Congress starts to seriously consider limiting or severely banning beer ads, Seagram also levels the playing field. Seagram's only beer products are two microbrews it's testing, Devil Mountain and Coyote.

"Right now there is a delicate balance in Washington regarding alcohol ads on TV," said one of the TV executives. "The status quo, where we have beer and wine ads, but not hard-liquor commercials, is working. I don't think [Rep. Joe] Kennedy's legislation is going anywhere as long as the status quo is maintained. So no one at the networks wants to upset the apple cart."

PROTECTING BEER SPENDING

Local TV stations also want to protect beer spending, which came to $189 million in their markets last year, according to CMR.

"Most of the local TV station owners have two other issues in Washington of great interest to them, mainly the questions of mandated children's programming and spectrum fees, and they don't need the headache hard-liquor ads would certainly draw from organizations like Mothers Against Drunk Driving," said an executive of a TV trade organization.

After Seagram announced it was running the ads in Corpus Christi, MADD said it was "concerned that the Seagram spots will open a floodgate for similar alcohol advertising that is appealing to youth, since industry competitors will hardly be able to stand by and allow one company to monopolize the airwaves."

PLANS FOR OTHER ADS?

As for Seagram itself, an executive close to the company said there is a media plan for more commercials.

Early indications had been that Seagram planned ads for another brand. "Seagram had been talking to us about running Captain Morgan" rum commercials, said T. Frank Smith, owner of KRIS-TV.

"We're not going to do that at this time," said Arthur Shapiro, Seagram's exec VP-marketing services, discussing Captain Morgan. Seagram has also considered creating and running broadcast ads for Chivas Regal and Absolut vodka. But TV outlets for those ads remain scarce for the forseeable future.

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