Having played a big role in boosting Viacom's revenue 12 percent in the first quarter, to a record $6.8 billion, MTV Networks will enter the upfront this year with an aggressive sales goal of taking almost one-quarter of dollars spent on cable.
Analysts, noting the ratings gains at MTV and Comedy Central, expect MTVN to grow CPMs about 15 percent on average, with MTV on the high end. "I fully expect them to achieve at least mid-to-upper-teen CPM growth, with executives hoping for more. They have six of the top 10 shows in cable," said Richard Greenfield, media director of Fulcrum Global Partners. Kagan World Media analyst Derek Baine also predicted sizable gains. "Low-to-mid teens is more likely," he said.
In a year when cable as whole is growing ratings by offering compelling programming across genres and advertisers are looking at spending more on cable, MTVN makes its case this week during its upfront presentation in New York. For starters, MTVN has more gross rating points in the 18-34 demographic—206,885 in fourth-quarter 2003—than any other TV outlet. That was an 11.9 percent gain year-to-year, while the WB—MTV's chief competition for youthful eyeballs—fell 18 percent. (In fact, all the broadcast networks were down, except Fox, which was up less than 1 percent. The other big cable groups, Turner and Discovery, posted 5-10 percent gains.)
MTVN executives also stress their focus on creating new marketing opportunities, new networks and video-on-demand content. Similar to how Turner sells its inventory, MTVN executives will be selling roadblocks, or "integrated units," of five spots across five networks at 10 p.m. that will deliver a 3.4 rating of unduplicated audience—competitive to broadcast. Moreover, MTVN is selling Noggin's teen block "The N" and VH1 Classics for the first time in the upfront. "With a confluence of great brands, we can help manage costs and be more efficient," said Mark Rosenthal, COO and president of MTVN.
MTV, VH1, CMT, Comedy Central and Nick at Nite have all delivered more 18-34-year-olds. The gains are driven in large part by original programming, such as MTV's Newlyweds: Nick and Jessica, Punk'd and Real World XI. "MTV has a unique ability to reinvent itself with each high school generational span of four or five years," said John Rash, svp/director of broadcast negotiations at Campbell Mithun.
Viacom credits Comedy Central, which is fully under the MTVN wing for the first time this year, for contributing to MTVN's overall 9 percent revenue growth in the first quarter, to $1.4 billion. Comedy Central's Chappelle's Show was the top-rated cable show among 18-34 year olds in April, netting 2.3 million viewers, and South Park still averages around 1.8 million viewers 18-34. Rash also credits the political satire The Daily Show With Jon Stewart. "The significance of The Daily Show goes beyond its ratings," he said. "It is a cultural barometer that other organizations source, making, ironically, the fake news the authority for a lot of young adults."
Going into the upfront, MTVN is stressing the relevance each network has to its audience. "More and more consumers are looking for brands they can trust and signposts that can help them navigate an increasingly complex landscape," said Betsy Frank, evp of research for MTV.