According to this article at The Wall Street Journal, the major networks are trying to get as much of their advertising inventory sold ahead of the fall season. And who is doing the best? Would you believe that General Electric's (NYSE: GE) NBC network is doing pretty good in terms of its ad sales? I know that might be difficult to comprehend, considering the network's ratings erosion. Believe it or not, though, NBC has achieved a record when it comes to upfront ad sales. It apparently is the first network ever to move just about the sum total of its ad inventory during the springtime.
NBC has generated approximately $1.9 billion in upfront revenues. I think this is impressive, especially given the competition of Disney's (NYSE: DIS) ABC, CBS (NYSE: CBS), News Corp.'s (NYSE: NWS) Fox, and The CW, which is a partnership between Time Warner (NYSE: TWX) and CBS. However, there is an interesting detail in the article that goes beyond the headline and does explain NBC's success to a certain degree. The dynamics of the upfront have been affected by a reduction in inventory that will be available once the season gets started. Because of this, these ads, the so-called scatter market, are more expensive. So, ad buyers have a natural incentive to take out as much upfront inventory as possible.
So, NBC may have set a record, but its success must be put in perspective. And while it might be heartening to see this much sales activity for the network, remember, NBC is trailing its competitors, and that means that the upcoming television season is crucial. A turnaround must happen. By the way, the ratings war isn't just scheduled for the fall, it's going on now, during the summer season, a time period which has taken on increasing importance for networks. They are now in the habit of debuting new shows during the dog days and are looking at programming something closer to a 52-week season than a 26-week season. I myself was watching a new NBC show last night, a horror anthology called Fear Itself.
As a GE shareholder, I am looking forward to NBC marketing the heck out of its schedule and taking its upfront-sales success with it during the scatter market (the latter will depend on a better ratings position). Then again, I am a bit conflicted, since I own Disney, too. No matter, I will enjoy watching the media wars throughout the year...
Disclosure: I own Disney and GE; positions can change at any time.
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Reader Comments (Page 1 of 1)
6-06-2008 @ 6:55PM
jolinda said...
I miss the point of this article. the only thing that came to mind is that the writer of this article is a "plant" by Ge to give a rosie picture of one the most missed managed, over spending, most tired and going to the motions TV networks . Ge wants to sell NBC after the olympics and so they get this guys to plant this horse shit.
6-07-2008 @ 8:39AM
Speculator said...
I watch CNBC and MSNBC a lot. I'm sure thoughs are part of the NBC number. I heard last week that there was a back lash over MSNBC liberal content. I read their ratings are getting better.
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