Updated: Soft Marketplace Unwraps Cable Upfront

The 2009-10 upfront will go down as the most drawn-out bazaar in TV history, and while the necessary compromises were eventually reached, few will look back on the last three months with a sense of satisfaction.“Nobody is exactly thrilled with how things played out,” said one media buyer, who spoke on condition of anonymity. “Guys on our side came to the realization that there was a limit to what kind of rollbacks the sellers were willing to accept. And the networks saw we weren’t going to go along with the CPM increases they were looking for early on, or even flat pricing.”As much as all parties involved can’t wait to watch the 2009-10 upfront recede in the rearview mirror, the cable marketplace still has quite a stretch of road ahead of it. While some of the major network conglomerates (Turner, NBC Universal, Viacom) have finalized their negotiations, a significant chunk of business remains to be written at Discovery Communications and Scripps Networks. Fox Cable Networks is believed to be all but wrapped up, while A&E Networks has completed around 80 percent of its deals. Mid- and third-tier cable nets have cut very few deals yet, and at this juncture, many executives don’t anticipate crossing the line before Labor Day. At the front of the line is USA Network, which secured superficial CPM rollbacks (-2 percent), thanks to its ratings prowess and historically low-price point. Turner’s TNT and TBS also absorbed relatively minor pricing decreases, ending with cuts of 4 percent. While Discovery has yet to finish its deals, the company has written better-than-average decreases (-3 percent to -4 percent). Meanwhile, with less than half of its upfront squared away, Scripps is writing business in about that same range. Viacom wrote rollbacks of –4 percent to –5 percent, although the MTV nets are thought to have taken a hit on volume. Cable on the whole will see CPMs retreat between 5 percent and 7 percent. Buyers suggest volume will drop between 10 percent and 15 percent (to land between $6.5 billion and $6.88 billion, down from $7.65 billion in ’08-’09). Those who have wrapped their upfront business are happy to jump back into writing scatter. “It looks like the worst is behind us,” said one ad sales boss. “You have to believe demand will be up 3 to 5 percent in 2010.”That said, some of those seated at the other side of the table remain skeptical. “We’ll see how scatter plays out,” said one national TV buyer. “The demand just wasn’t there in the upfront, and…there’s no way of knowing exactly how much money is going to be out there.”

Convergent TV

Updated: Soft Marketplace Unwraps Cable Upfront

Anthony Crupi

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Anthony Crupi