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.

Continue reading How well is NBC doing with ad sales?

How well is NBC doing with ad sales? originally appeared on BloggingStocks on Fri, 06 Jun 2008 18:25:00 EST. Please see our terms for use of feeds.

There's a great article over at The New York Times. It's about all the changes happening at the broadcast networks concerning the traditional upfront model -- the practice of presenting to advertisers around the month of May a new portfolio of programming to be commenced in the fall season and the subsequent booking of ad dollars for said programming. That's how the process has worked -- CBS (NYSE: CBS), General Electric's (NYSE: GE) NBC, Disney's (NYSE: DIS) ABC, News Corp.'s (NYSE: NWS) Fox, and Time Warner's (NYSE: TWX) and Viacom's (NYSE: VIA) CW show their wares now so that they can sell commercial inventory well ahead of the season premieres.

Well, according to the article, you can thank -- or blame -- the writer's strike for the dismantling of this quaint mechanism. I chose to thank the strike, because I think change is good in this case. You see, the broadcasters want to move to a 52-week season -- i.e., they want to debut new shows on a year-round basis instead of all at once, thus neutralizing the need for big upfront promotions. Actually, I should point out that there were probably other factors that helped this decision along -- most of them centering around costs and expenses. The expensive pilot-development process just isn't where it's at anymore. In fact, I wrote about this new paradigm back in April when NBC's co-chairman Ben Silverman was embracing it -- he's actually going for a 65-week season!

Continue reading Will broadcasters stick to a new 52-week model?

Will broadcasters stick to a new 52-week model? originally appeared on BloggingStocks on Mon, 12 May 2008 15:47:00 EST. Please see our terms for use of feeds.

Do you remember the old Fox show Beverly Hills, 90210, the one that featured Shannen Doherty and Luke Perry? The CW, a joint venture between CBS (NYSE: CBS) and Time Warner (NYSE: TWX), certainly hopes you do. According to The Hollywood Reporter, an updated spinoff version is in the works by CBS Paramount Network TV.

The late, great TV producer Aaron Spelling gave us the original show back at the beginning of the 90s, and it was one of the programs that really defined and made News Corp. (NYSE: NWS)'s Fox network famous. I do remember the hype and excitement that surrounded the series and its stars; I also remember the controversies with Doherty, and the nepotism with the hiring of Spelling's daughter, Tori. All in all, it was an interesting project. If The CW can capture the magic of this old idea, then it will prove that mining library product is an efficient way of bringing in the ratings.

It'll be cool to see how a new set of 90210 brats utilize modern digital devices like YouTube, eBay, text messaging, etc. And it will be interesting to see how this new version fares; I'm sure there are plenty of blogs deriding this notion. But, like I said, this is all about making proper use of intellectual assets. CBS is the owner of Spelling Television's assets, and it would do well to mine whatever it can to compete against Disney (NYSE: DIS)'s ABC, General Electric (NYSE: GE)'s NBC, and Fox.

Disclosure: Steven Mallas owns Disney and GE; positions can change at any time.

CBS believes '90210' still has brand equity -- do you? originally appeared on BloggingStocks on Thu, 13 Mar 2008 15:33:00 EST. Please see our terms for use of feeds.

So, I was checking out headlines on The Hollywood Reporter's website when I came across an article that discussed CBS (NYSE: CBS) CEO Leslie Moonves and his comments regarding pilots and the TV development process in general; these comments were made during CBS' earnings call. Moonves believes that developing a network series is more expensive than it needs to be, and he was quoted in the piece as describing the generation of multimillion dollar pilots as "vastly overrated." He said that the writers' strike actually saved CBS about $70 million. And, he seems to question the correlation between expensive sums thrown into the development of a series and the odds of success.

All I can say is -- thank you! Finally, the religion is starting to spread (I hope). It's not popular to state this, but I just don't think media companies such as Disney (NYSE: DIS), News Corp. (NYSE: NWS), Viacom (NYSE: VIA) and Time Warner (NYSE: TWX) need to bid up the compensation of talent to be effective at assembling a valuable library of entertainment product. Let's face it -- we've always known that big salaries for stars and/or an expensive development process never guaranteed a good return on invested capital on an entertainment project -- there are just too many variables, too many vagaries involved in the acceptance or rejection of a project by the public at large. I truly hope that CBS, Fox, ABC, General Electric (NYSE: GE)'s NBC, and the CW start to cut development costs as aggressively as possible following the lessons learned from the writers' strike.

I'm not holding my breath, however. I know that whatever lessons have been learned will be forgotten soon enough. Shareholders in media companies need to pressure their CEOs into reducing costs spent on the creation of entertainment. Execs like Moonves should have had the guts to call pilots overrated a long time ago; I don't think a writers' strike was necessary to bring this issue to the forefront. Please, don't forget your current sentiment -- a lot of shareholders are counting on you.

Disclosure: I own shares in Disney and General Electric.

I love this guy Moonves: Pilots are 'vastly overrated' originally appeared on BloggingStocks on Wed, 27 Feb 2008 11:40:00 EST. Please see our terms for use of feeds.

Continue reading Will 'Reaper' help The CW reap new viewers?

Will 'Reaper' help The CW reap new viewers? originally appeared on BloggingStocks on Wed, 26 Sep 2007 17:05:00 EST. Please see our terms for use of feeds.

Continue reading CBS and CW upfronts causing me stress

CBS and CW upfronts causing me stress originally appeared on BloggingStocks on Tue, 15 May 2007 11:38:00 EST. Please see our terms for use of feeds.