Cable Ad Upfront May Top $2.7B

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The bulk of the cable-upfront marketplace appeared to have
wrapped late last week, as some sellers felt that it was possible that overall volume will
top $2.7 billion.

That would be about $400 million to $500 million above
cable's year-ago record of $2.3 billion. In sharp contrast, the broadcast upfront
finished flat, at $6.2 billion, advertising-agency sources said.

In contrast to the ebullient moods of the sellers, there
were some on the buying side who maintained that cable's upfront was proceeding much
more slowly than network executives said.

Certainly, for "tier-two and tier-three niche
networks," Madison Avenue sources agreed, the upfront likely will continue through
late July.

Amid all of the euphoria, there were some contentious
moments. Some executives on both sides have taken the upfront's poker-game image to
the max, often walking away from the table.

After bluffing by both parties, some negotiations collapsed
in the past two weeks or so -- notably between Turner Broadcasting Sales Inc. and Grey
Advertising; and between USA Networks Inc. and Zenith Media Services.

Sources said Grey balked at Turner's request for 9
percent cost-per-thousand-homes (CPM) increases, the result being that Turner wound up
with only about one-third of Grey's business.

As for the USA/Zenith dustup, John Silvestri, USA's
executive vice president of ad sales, said they "parted ways amicably ... basically
over CPM issues." It's not common for parties to walk away from the table, but,
Silvestri said, "that does happen from time to time. Eight out of 10 times, you can
come to terms."

Silvestri added foods to the list of categories boosting
cable budgets considerably, citing Kraft Foods, Nabisco and Kellogg Co.

In early June, brinkmanship was practiced by some buyers.
These agencies suddenly revised their budgets "substantially" upward, just weeks
after having submitted "flat-to-down" budget plans, a Turner executive said.

Elsewhere, another seller confirmed that "ploy,"
which, he said, was designed to panic the networks into cutting rates. "But so
far," he said, "we all -- including Turner and USA -- seem to be holding
firm" on pricing.

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