Syndication Upfront Sales Moving Faster Than Expected

Cable Deals Happening, but Negotiations Likely to Stretch Beyond July 4

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NEW YORK ( –- This year's syndication upfront is proving more robust than in the past, with media buyers predicting the about $2 billion market could wrap late this week or early next. Cable networks are also still doing deals, but their upfront sales are expected to stretch beyond the July 4 holiday, according to buyers.
Faith Hill appearing on 'Oprah.' Original syndicated fare like Oprah Winfrey's show are getting the biggest share of the upfront dollars.
Faith Hill appearing on 'Oprah.' Original syndicated fare like Oprah Winfrey's show are getting the biggest share of the upfront dollars.

More than half of the syndication market has been sewn up, with first-tier properties commanding cost-per-thousand percentage increases in the mid-to-high single digits.

More pharma money
"It's at a faster pace than we have seen for the last couple of years," said Amy McMahon, an associate director at Publicis Groupe's Starcom USA.

One reason for the faster pace this year is the presence of additional money from pharmaceutical companies and some marketers' inability to get their money down on traditional broadcast-network schedules.

Most of the syndication deals are using the standard established in broadcast negotiations. The pacts are based on commercial ratings, so long as they account for audiences who watch as much as three days later via use of a digital video recorder.

The usual suspects
Leaders in the market are the usual suspects, the companies that produce original content such as "The Oprah Winfrey Show" and "Ellen," rather than so-called off-network repeats of once-popular programs. As such, buyers report, Time Warner's Warner Brothers, Walt Disney's Buena Vista and CBS Corp.'s CBS Paramount Television and King World are among those getting the biggest share of the dollars. Lower-interest programs are securing cost-per-thousand percentage increases in the low single digits.

One program attracting lots of attention is a syndicated effort based on gossipy, celebrity-news web site TMZ, said one buyer.

Meanwhile, the cable marketplace is proceeding apace, with many of the outlets agreeing to use commercial ratings in their deals. Nonetheless, buyers expect the market to finish flat with last year's $6.5 billion. Some cable inventory -- such as that from NBC Universal and News Corp.'s Fox -- was packaged with broadcast time sold in earlier sessions.

Lifetime-Group M deal
Executives familiar with the negotiations said NBC Universal is well on its way in writing upfront deals, with CPM increases and metrics on par with what the broadcast networks wrote last week -- i.e. in the mid-single digits and C3, or commercial ratings with "live-plus-three" viewing.

Lifetime closed a deal valued at about $70 million earlier this week with WPP Group's Group M, also using commercial ratings and "live-plus-three" viewership. Time Warner's Turner entertainment networks closed at least one major deal Tuesday with a 12% CPM increase, with the majority of those networks' business expected to wrap by week's end, according to one executive familiar with negotiations.

Holdouts at MTV
While many cable networks are adopting commercial-ratings guarantees, Viacom's MTV Networks are still holding out for deals based on program ratings. Last week, MTV sent clients a letter saying advertisers would have to agree to apply a universal measure for MTV, VH1, Comedy and Spike in order for MTVN ad chief Hank Close to do any business with the new commercial-ratings terms.

Cable news is also said to be going out earlier than usual in this year's upfront in anticipation of the 2008 February primaries and the presidential election. Overall cable negotiations could drag out well past the July 3 timeframe several executives initially thought would be possible: "There is still a lot of work to be done before the business can be closed," one key sales exec said.
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