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Fox and CW sing and bite for ad dollars

June 4, 2010 | 11:30 am

NIKITA

With hot shows including "Glee" and "The Vampire Diaries," and hopes for a slightly stronger economy, Fox Broadcasting and the CW were able to get advertisers to pay more for commercials on their networks for the 2010-11 television season.

Both Fox and CW say they are wrapping up their so-called upfront sales, which is when the TV networks sell the bulk of their ad time for the new season. Fox is expected to take in about $1.9 billion from advertisers, while the smaller CW sold about $380 million in commercial time.

Fox fetched rate increases of 9% over last year's upfront prices, while the CW was able to hike its rates about 7.5%. 

The other major broadcasters -- CBS, ABC and NBC -- continued to haggle with advertisers Friday over prices as buyers refused to pay as much as the networks had initially hoped. Fox appears to have established the ceiling for price increases, making it difficult for the other networks to raise their rates more than the 9% that Fox pulled in for most of its prime-time commercials.

The CW, a joint venture between CBS Corp. and Warner Bros. Entertainment, said it did particularly well among automakers this season.

"As the youngest-skewing network with a full schedule of original programming for the first time, we've seen tremendous year-to-year growth in all key [advertising] categories, including health and beauty, retail, wireless [phone carriers] and autos, both domestic and foreign," Rob Tuck, the CW's executive vice president for national sales, said in a statement. The CW's hot new show that advertisers are lining up for is "Nikita," the latest remake of "La Femme Nikita." Think "Alias" with even more action.

The CW's big coup was to get advertisers to pay TV ad rates for the commercials that run within episodes that are streamed online. "The vast majority of our clients have bought both on-air time and the full episode streaming online," Tuck said in an interview.

"The business has recognized the changes in viewers' behavior," he said. "Our younger viewers don't see a difference in watching a show on the television screen or watching it on their computer screen. And during this upfront market, the advertisers agreed that there wasn't really a difference either."

Typically, networks sell about 80% of their commercial inventory before the TV season starts. The rest is held back for what is known in the industry as the scatter market. Ads are sold during the upfront market with a ratings guarantee, and if a network does not deliver the audience promised, advertisers get extra commercials known as "make-goods" to make up for the ratings shortfall.

-- Meg James

Photo: The CW's new show "Nikita." Credit: The CW.

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