The Cabletelevision Advertising Bureau takes great exception to the editorial "Unplug this twisted cable" in the July 16 Ad Age. The editorial, written a week after Ad Age ran an article titled, "Study stokes cable-broadcast brawl," wrongfully accuses CAB of creating fictional data in making a projection of the potential broadcast audience shortfall and make-goods that may occur this summer. It is mean-spirited, one-sided and unfounded.
If Ad Age disagreed with CAB projections, it was Ad Age's prerogative to not run the story. More troubling is the condemning tone of the editorial, which explicitly states this was a "bogus" study and CAB created "fictionalized" data. These are seriously mistaken comments that should be retracted. This was a projection CAB made based on the very real and very high year-to-year audience growth figures ad-supported cable is currently experiencing, and the correspondingly severe erosion of the broadcast networks.
When we met with Ad Age's reporter, he was told numerous times our make-good projection hinged on two factors: 1) the broadcast audience delivery guarantee; and 2) the CPM guarantee. We knew neither of these figures. But to illustrate the potential for make-goods, we took as a starting point broadcast audience levels and CPMs from last summer. One can take issue with utilizing year-ago figures and the article covered differing points of view, but there was nothing "fictional" nor "bogus" in how CAB derived its projection. It was a straightforward mathematical exercise. We originally projected the four major broadcast networks would deliver (on average) over a half-million fewer homes this summer vs. last summer. Based on the first two weeks of July, we may have given broadcasters more credit than they deserve. Two weeks into summer, ABC, CBS, NBC and Fox are on average down 632,000 homes vs. year-ago levels.
Ultimately, Ad Age's editorial is a disservice to its readers-especially advertisers, whose money is at stake every time they purchase commercial inventory. There are going to be broadcast shortfalls and that has serious consequences for advertisers. It also has serious consequences for broadcasters, whose rapidly shrinking prime-time audience undermines efforts to promote summer line-ups, which may boomerang on them as they promote sampling of fall programming.
Neither the article nor editorial makes mention of one essential fact we made explicit to Ad Age. At a time of slower economic growth, advertisers are trying harder than ever to stretch their media dollars. Their best investment is with ad-supported cable, which is growing by leaps and bounds. During the same summer period in which the broadcast networks are down collectively 2.3 million homes, ad-supported cable is up 2.7 million homes and 5 U.S. household share points. And that is no projection.
Joseph W. Ostrow
Cabletelevision Advertising Bureau
'Gear' not for sale
I like and respect Ad Age, so I was disappointed by your report "Magazines lining up for selling block" (AA, July 16) in which you allege Gear is for sale and/or talking to publishing companies about a partnership. Both are untrue.
No doubt your reporter heard a rumor and, mistaking a rumor for a fact, printed it. That, frankly, is bush league: One of the cornerstone principles of journalism is you don't publish an unsubstantiated rumor. But where is the substance in this report? Sources aren't named, potential companies supposedly approached aren't mentioned and not a stitch of evidence is offered for something as inflammatory as suggesting a company needs to be bailed out (the theme of your article).
The truth-and I'm not so naive as to think that is necessarily relevant-is that Gear has just sent to press its first profitable issue, which is 100% up over last September in advertising revenues and has risen to a paid circulation of over 500,000.
He [your reporter] did reference my categoric denial of his story, burying it in the middle of the text. I told him at length ... that our strategy to grow was to avoid partnering with large publishing companies where we would get lost, and instead raise investment from financial institutions to take advantage of expansion opportunities and acquire compatible publications. Down the road, a merger with a giant may make perfect sense. Now it doesn't.
Bob Guccione Jr.
Editor in Chief
Loss promotes growth
There is nothing that leaves you with a sick feeling in the bottom of your stomach like losing an important new-business pitch. You replay meetings over and over in your head: the could've saids, the could've showns, the could've sents. There is probably not a more profound form of torture, and yet greater growth experience, than losing. Thanks for taking the sting out of it, and for revealing a little of the soul of this agency in the process, by reporting our loss of the AT&T pitch with dignity and class ("The Call," AA, July 16).
Sting or not, in today's environment we have to dust ourselves off pretty quickly and get on with business. Thanks for documenting the trials and tribulations of our journey.
Chief Marketing Officer
Playa del Rey, Calif.