TV Upfront

The Unlikely TV Network on Everyone's Lips During Upfronts

ION Is Grabbing More Upfront Dollars As Bigger Cable Networks Turn Money Away

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I Credit: ION Media Networks

There's one often forgotten TV network that's been on the lips of media buyers during the annual upfront ad haggle, further showing the unusualness of this year's marketplace. That network is ION.

Typically an after-thought on advertisers' TV plans, the channel, which airs reruns of shows like "Law & Order: SVU," "Criminal Minds" and "Blue Bloods," is gaining some attention as media buyers look for outlets to place ad dollars as bigger cable channels command double-digit price hikes and turn away those who don't want to pay.

Perpetuating ratings declines meant there was less inventory for top tier cable networks such as NBC Universal's USA Network, FX Networks and Turner's TBS and TNT to sell. This tightening in supply, and relatively strong demand from the buy side, allowed these networks to have an upper-hand in negotiations.

"Big cable networks didn't blink for advertisers who refused to pay double-digit price increases," one media byer said. "They could be selective in what they take and don't take and pushed cheap money away."

The "cheap" money the buyer is referring to is those legacy ad deals that reward marketers for decades of business by guaranteeing smaller price hikes off lower bases.

That means it was difficult for those marketers that have been "grandfathered" in to up the money they spend at these levels.

"I'd definitely say some of the dollars that weren't able to land on the bigger cable nets [like] USA [and] Turner have trickled down to the IONs and WGNs of the world where it's been a bit of a challenge closing those deals," a second media buyer said. "They definitely got trickle down money."

ION was able to command higher increases in the cost to reach a thousand viewers, an industry standard known as CPMs, than had been expected, the second buyer said.

In a typical year a network like ION would take "anything that's thrown their way," the first buyer said. "But that wasn't the case this year."

ION sits at an interesting intersection between broadcast and cable. It owns 60 TV stations and reaches about 100 million households through a combination of over the air, cable and satellite. But advertisers lump ION in with cable channels as part of their media buys due to the type of programming it airs.

ION's origins date back to Pax TV, which debuted in 1998 with a focus on family oriented programming. Lowell "Bud" Paxson got Pax TV on the air by buying local stations instead of going through cable operators.

It was rebranded as Independent Television in 2005, converting into a general entertainment network that aired mostly acquired programming, and became ION in January 2007.

ION averaged about 1.3 million viewers and a 0.3 rating in the 18-49 demographic in 2015, compared with 1 million total viewers and a 0.3 rating in the year prior.

"It's one of the few places with capacity and is underutilized," the second buyer said.

"Its solidly rated off-network dramas (mostly CBS shows) provide a stable, cost-efficient environment for most clients ... you know what you're getting and it always delivers, a big plus for most advertisers," Billie Gold, VP-director of programming research, Amplifi, said via email.

WGN, GSN and Hallmark Channel have also been called out as networks receiving an influx in ad dollars that typically would have gone to bigger channels.

Some dollars are also being pushed into syndication, which historically is more reasonable than broadcast and big cable from a pricing standpoint, the first buyer said.

While "The Ellen DeGeneres Show" and reruns of "The Big Bang Theory" might command a premium price point, "the rest of the stuff we can usually name our price," the first buyer said. But that too has changed.

ION spokespeople did not return requests to comment.

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