MTV gets aggressive: Cable cuts deals as broadcasters pitch their wares

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Even as broadcasters unveiled their fall schedules, cable giants including Discovery Communications, Viacom's MTV Networks, NBC/Universal's USA Network and Time Warner's Turner Entertainment Group began nailing down deals with media agencies last week.

The fast start to the cable market was so intense that some TV buyers skipped the broadcast upfront presentations to finish negotiating cable deals, media executives reported.

Buyers expect the broadcast upfront market to break as early as this week or just after the Memorial Day weekend. Many expect cable spending to rise rapidly this year at broadcast's expense.

They viewed the early cable deal-making as both confirmation of that as well as posturing by media buyers hoping to scare broadcasters into believing they will lose out if they seek aggressive price increases.

Mark Rosenthal, president-chief operating officer, MTV Networks, confirmed he was close to finalizing a deal with WPP's Group M, which negotiates on behalf of MindShare and Mediaedge:cia. "We feel really great about our discussions with MindShare/Group M, but we don't have a fully completed deal," Mr. Rosenthal said. MindShare executives refused to discuss the talks.

earlier deals

Deals are being done much earlier, Mr. Rosenthal added: "We are much further ahead, much earlier than we've been in prior years."

Among the advertising categories expected to put more money into cable are film studios, retail and pharmaceutical.

Costs per thousand rates at general entertainment cable channels, one sales side executive said, are up about 4%.

A senior buyer, who did not wish to be named, said, "Deals have been done. We're seeing deals involving increased volume in return for discounts to the market."

Starcom Worldwide, Chicago, part of Publicis Groupe, is thrashing out an agreement with Turner Entertainment Group, though neither party would confirm. David Levy, president-sales and marketing, Turner Entertainment Group, said, "There seems to be a shift of dollars that are waiting for the right deal."

General Motors Corp. is said to have a deal with Time Warner's CNN. A spokeswoman for General Motors had no comment.

big shift

Last week, Deutsch, part of Interpublic Group of Cos., agreed to shift $42 million, or 20%, of its clients' total prime-time budget into cable, syndication and Internet broadband. Deutsch, whose clients include Bank of America and Revlon, is close to tying up a deal with MTV Networks, parent to MTV, VH-1 and Nickelodeon.

The active cable market is no surprise, given two factors: The speed at which the children's TV market moved, (up to 70% of inventory was reported sold by late April), and marketers who warned they'd spend their money elsewhere this year.

Cable networks took in $5.2 billion during last year's upfront, compared with $9.5 billion for broadcast networks. Advertising Age estimates suggest that some $500 million more could move to cable this year.

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