Broadcast television networks typically sell the bulk of their advertising for the coming season in a handful of days in late May and June. But this wasn't a typical year.
With the sour economy, declines in consumer spending and sagging prime-time rankings, network sales executives have had to work overtime this summer to close deals with advertisers. For more than a month, talks were stalled because advertisers were demanding steep cuts in pricing -- and the networks initially were refusing to give in. Several weeks ago, the impasse melted and the networks started to slowly ring up sales with major advertisers.
Until now, none of the networks nor the advertising buyers was publicly discussing the results of the closed-door negotiations.
However, this afternoon, the No. 1 network, Fox Broadcasting, broke its silence and said it was nearly finished with its "upfront" sales and that it was pleased with the results.
"As the upfront selling season winds down, Fox Broadcasting has achieved its prime-time revenue goal," sales president Jon Nesvig said in a statement. The network declined to provide a dollar amount for the business it wrote this summer or say whether its "revenue goal" included shaved ad rates.
Fox conceded that it did not sell as many prime-time commercials this summer as it has in the past. That is an indication that the network held back commercial time rather than slash prices simply to make sales and move inventory. The network is betting that its new fall shows will perform well in the rankings, thus allowing the network, owned by Rupert Murdoch's News Corp., to command higher prices later on in the year.
In fact, Fox is being a tad bullish.
"While the overall economic climate was difficult during the first six months of 2009, the short-term market for national broadcast time remained strong," Nesvig said. "With a broader economic recovery seeming to take hold, we are very comfortable in our marketplace position for next year."
Wall Street analysts have predicted that the upfront sales season would end with networks booking 15% lower revenue than last year's slightly more than $9 billion in sales of prime-time ads.
— Meg James