For nets, upfronts won't ad up

Analysts project double-digit declines and less volume for Big Four

The upfront haul for the Big Four broadcast networks will decrease 15% from the 2008 tally to about $7.4 billion, according to a projection by Barclays Capital.

Miller Tabak predicts a more modest Big Four decline of 9.8%, to $8 billion, and a 9.9% drop to $8.4 billion for the six broadcast networks.

Along with the economic downturn — including a drastic scaleback by key advertiser groups like automotive — the anticipated drop in upfront volume owes to declining ratings for the broadcast nets, a shift of ad dollars from broadcast to cable and the Internet and the networks' decision to hold back inventory, according to Barclays.

Hoping the economy will pick up during the next year for a robust scatter market, the Big Four are expected to offer an average of 72% of their ad spots during the upfront market, down from 82% last year.

CBS again is holding back most, putting only 69% of its ad inventory on the upfront.

Prices are expected to drop only slightly, by 2%-3%, as the networks intend to hold the line and sell fewer ads at targeted rates rather than offer discounts, Barclays said.

The expected price drop is largest for NBC (5%), followed by ABC (3%). Fox and CBS will hold steady with 1% CPM cuts, according to Barclays.

Miller Tabak's outlook is brighter for the Big Four, with only NBC in negative price territory (-2% from last year) and the other three poised to score CPM increases of 1% (ABC), 2% (Fox) and 3% (CBS).

Additionally, the networks might be prepared to make other concessions to buyers, Barclays said, including better upfront cancellation terms, more product-placement and other branding opportunities and online video offerings. (partialdiff)
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