Cable to Claim a Bigger Slice5/22/2005 8:00 PM Eastern
With the broadcast networks wrapping up their upfront presentations last week, all concur that cable is likely to see a strong shift of broadcast ad dollars coming its way.
All trends point to a strong upfront for cable, said Cabletelevision Advertising Bureau president Sean Cunningham. Already last week, several networks had completed some client deals, and that’s likely to ratchet up this week.
CAB’s Cunningham pointed to yet another year of broadcast viewing decline and cable’s continual growth trend. In his 66 presentations to advertisers and ad-agency executives across the country this year, he said many clients are increasing their spending on cable.
“No one has said less,” he added. And that’s a good thing, because most advertisers have a pretty good idea of their preliminary plans in February.
No one can predict if cable will move first, as it did for the very first time last year when the Turner Broadcasting System Inc. networks completed their sales before the broadcast selling began. Programmers are describing this year’s climate as more “paced.”
Cunningham said he was amazed to see how traffic to CAB’s Web site, One TV World (www.onetvworld.org), has followed the same curve as the planning, buying and selling cycle, with traffic spiking upwards as the real action started.
Another interesting harbinger of why the cable upfront could be so strong is that year-to-date, there’s been dramatic growth in the 12-to-24 demographic on cable in primetime, but not in broadcast.
Clearly, cable has grown up in terms of how it approaches the market. For example, Court TV executive vice president and general manager of ad sales Charlie Collier said, we “try to speak to clients all year round.” He also pointed out that a strong second-quarter market for scatter in cable — which means very little inventory left unsold — was one gauge of a strong upfront for cable.
And that’s not the case for broadcast, which has had weak fourth-quarter scatter, according to Merrill Lynch analyst Jessica Reif Cohen. Still, no one ever predicts the final end game. There are too many variables that could affect both broadcast and cable upfront sales.
Car advertising could be off, given the fact that SUV sales are in a slump due to high oil prices. But that decreased spending could be mitigated by increased outlays from car manufacturers with hybrid models.
Likewise with pharmaceuticals: While several companies with prescription drugs, like Vioxx, have been pulled off the shelves, New York programmers are in ecstacy over one of the worse allergy seasons which has not only puffed up noses, but also spending on allergy relief medications.
Likewise, in the overheated New York commercial real estate market there’s plenty of advertising demand from mortgage, lending companies and real estate agencies.
So cable is already out of the gate with several completed deals, and the dance has just begun.