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All-Day Parley of TV Ad Buyers and Sellers Goes Nowhere

By Published on .

NEW YORK (AdAge.com) Today's much ballyhooed meeting between the TV networks, media agencies and their clients over how to alter the upfront negotiation process was
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something of a wash out with no consensus reached about how to improve it. No further meetings are scheduled.

ANA: 'Generally acceptable'
In a late afternoon conference call with the media, Bob Liodice, president-CEO of the Association of National Advertisers, summed up the meeting thus: "What we seemingly reached was a consensus that while it is not a perfect process, the current process was generally acceptable." Mr. Liodice said that while there was some real debate about issues such as moving the upfront to another month, perhaps September, participants offered numerous reasons for keeping it in May.

The upfront refers to the freewheeling auction that takes place each spring as the TV broadcast networks try to sell between 75% and 80% of their commercial airtime ahead (or "upfront") of the new fall TV season.

One participant, who did not wish to be named, said some attendees were wondering why they were there at all. The participant said: "No agency buyer, especially with their clients present, is going to put anything into jeopardy."

So much money at stake
The executive pointed out that with the upfront looming, this was no time to be discussing the idea of a closing bell when so much money is at stake. "If staying late means you get a better deal, then you'll stay late."

The meeting, titled the Network Upfront Discussion Group, or "NUDG," was convened by the ANA and the American Association of Advertising Agencies and lasted almost four hours. Around 30 people attended, including marketers from Sears Roebuck & Co. and Pfizer. The points on the agenda were the idea of a closing bell and the possibility of moving the upfront to a different month or creating two half-year selling sessions.

David Verklin, CEO of media agency Carat North America, part of Aegis Group, has been a vocal proponent of the bell. When he spoke at the ANA's annual Television Advertising Forum, Mr. Verklin likened the upfront bell to the closing bell at the New York Stock Exchange.

56.6% of marketers dissatisfied
The discussion, the first of its kind between all parties involved in the upfront, follows the March release of an ANA survey demonstrating that 56.6% of marketers are dissatisfied with the process while 47% believe that current network pricing is unfair. The subject of pricing, however, was off-limits because of anti-trust issues.

O. Burtch Drake, president-CEO of the 4A's, added that perhaps a more strenuous debate over the real issue of dissatisfaction -- rising prices and falling numbers of viewers -- did not occur, because the "discussion was constrained by the lawyers." Lawyers were invited to attend to ensure that no anti-trust issues were raised.

NBC doesn't show
While representatives from broadcast networks ABC, CBS, Fox and from cable network Turner Broadcasting appeared, NBC did not. The network had no immediate comment on its reasons for staying away.

One network executive, who spoke off the record, seemed a little bemused by the proceedings. "We are a service business. The networks are very open to listening to what they [agencies] had to say," the executive said. "Either way we were willing to work with them."

Network officials had no comment on the proceedings or did not return calls by press time.

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