Analyst: 2010-11 Broadcast Upfront Up 20%


Broadcasters can expect nothing but blue skies as the upfront draws near, as one analyst anticipates that networks will see significant gains in volume and pricing during the 2010-11 bazaar.

According to a report issued by Barclays Capital analyst Anthony DiClemente, the Big Four will enjoy a 20 percent gain in upfront dollars, commanding a total haul of $8.26 billion, with CPMs likely to increase by high-single-digit percentages.

DiClemente noted that the improvement will be driven by an improving automotive sector and a desire for media buyers to lock in favorable pricing. The analyst estimates Q2 scatter pricing coming in at a 15-25 percent premium versus the 2009-10 upfront, adding that this year’s springtime sales “will likely weigh in at some discount to those increases.”

The analyst also predicted that double-digit CPM increases were unlikely.

If the upfront proceeds in an orderly fashion, broadcasters could move as much as 77 percent of their available inventory, up from 69.8 percent in last year’s compromised marketplace.

Per DiClemente’s analysis, CBS and Fox should reap the benefits of season-to-date ratings increases across the core demos; as such, both nets can expect to boost volume by 20 percent or more. (CBS could boost its overall take by as much as 27.5 percent, to $2.43 billion, while Fox can swell its volume by 22 percent, to $1.96 billion. Both should post mid- to high-single digit CPM increases (7-8 percent).

As far as year-over-year gains are concerned, ABC and NBC may lag behind their rivals. DiClemente sees ABC’s upfront sales growing by as much as 16.2 percent versus a year ago, to $2.21 billion, while NBC may improve by some 12.8 percent, to $1.65 billion. The latter should get a lift as it returns to programming the 10 p.m. hour with original dramas, following the failed Jay Leno Show experiment.

ABC could lift its CPMs by some 6 percent, while NBC is expected to improve its price advantage by 4 percent.

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