Cable upfront down 12%

Lower client budgets, change in sales strategy were factors

In what proved to be the softest summer market since 2001, cable saw its 2009-10 upfront take diminish by 12% as the networks wrote $6.73 billion in business.

Although the Cabletelevision Advertising Bureau has yet to issue a definitive tally, network and media agency sources concurred with the figure, which was derived from a base sum of $7.65 billion in the 2008-09 bazaar.

Contributing to the $920 million shortfall were a mix of battered client budgets, mid-single-digit CPM rollbacks and ad sales executives' desire to hold back inventory for scatter -- a strategy that has paid off thus far in the fourth quarter, as avails fetch high-single-digit premiums over upfront pricing.

Two years ago, cable nailed down $7 billion in upfront business, up 6.5% compared with 2006.

As ad spending begins to creep back to pre-recessionary levels, analysts believe that cable will enjoy a significant lift in the near term. This week, UBS forecast cable ad sales will grow 6% in 2010, with Discovery Communications, Disney and Scripps Networks expected to see ad dollars increase 7%. The Turner nets and News Corp.'s cable properties should see a 6% uptick, per UBS, and Viacom could grow its ad revenue by as much as 5%.

"We believe that a return to the historical trend will lag into 2011, but ... the bottom line is that the advertising spending trend will return to historical levels," the UBS report concluded.

Meanwhile, Credit Suisse estimates that broadcasters saw a 22% drop in volume as the networks booked $7.2 billion in upfront business. All told, some $2.9 billion in TV dollars was left on the table this summer.