The big four networks – ABC, CBS, NBC, Fox – and several of the smaller ones, held court at various venues across New York all week, and received varying degrees of buzz about their new shows, as advertisers, TV critics, agency folk, media executives and TV stars schmoozed at various events.
Though it’s easy to get distracted by the glitz and glamour, the Upfronts are a serious business. Last year, they brought in an estimated $9bn (£5bn) of advertising. The challenge for the networks is how to keep this year’s ad sales figures near the same mark, which, by some estimates, was down by around $500m (£250m) from the year before.
The US TV advertising industry today is engaged in debates about the battle for viewers’ eyeballs versus other media, and whether the current audience measurement methods are still relevant – but more of that later. The first thing the TV networks can do to win viewers is undoubtedly to have great shows, and there were plenty to see from each network. NBC was first up with new drama shows including Journeyman, Bionic Woman (yes, a re-make) and Chuck. NBC ruled US TV in the 1990s, with genre-beating sitcoms such as Friends, Frasier, Seinfeld and Cheers. But, in recent years, it has struggled to find good shows.
Upfront attendees were reminded of NBC’s heyday when Jerry Seinfeld came on to present a new set of “mini-sodes” coming this autumn. Disney-owned ABC has some of the strongest and most versatile prime-time viewing on US TV, as far as agencies are concerned, and the network isn’t about to dismantle the formula. It has shows like Grey’s Anatomy, which is spinning off a new series, Private Practice and, of course, Lost. Also new from ABC is Pushing Daisies, starring British actress Anna Friel, and Cashmere Mafia, which the New York Times described as yet another attempt to replicate the successful formula of Sex and the City.
CBS brought in the biggest budget last year, way north of around $2bn (£1bn). CBS has done well with its CSI franchise, with shows set in New York, Miami and Las Vegas. This year it’s introducing several new dramas with the highlight being a Viva Laughlin, produced by Hollywood star Hugh Jackman (X-Men) and based on the British show Viva Blackpool. Rupert Murdoch’s Fox Networks’ recent prime-time viewing is pretty much built around the long-running success of American Idol and 24. Some media buyers were reported to fret about how much longer Idol has left, but it carries on regardless.
One of the more talked about shows, but not necessarily for all the right reasons, was ABC’s Cavemen. It probably got extra discussion time during the Upfronts because Cavemen is a rare example of a TV show created from an ad. In this case it was a popular campaign from car insurance company Geico, with the tagline, “So easy a caveman could do it”. The premise is the cavemen are offended by the patronising ads, so, in various spots, they argue over the issue with a talk show host and a psychiatrist. However, several critics said the TV show has simply stretched a good ad idea too far.
The numbers game
Despite the great programming debates, the big discussion point for all parties concerned this year was how TV ratings will be measured and how to decide on the best audience currency for buying and selling advertising airtime.
Nielsen Media Research has been the dominant measurement tool for advertisers and TV networks for many years, through its sampling of households across the US, either with written surveys or Nielsen’s Set Meters. But, in recent years, Nielsen’s TV ratings system has been under pressure from all corners of the industry for being out of date in a world of personal video recorders (PVRs), video-on-demand services and numerous other ad-avoidance technologies. Nielsen’s response includes a new Commercial Ratings system, which, for the first time, would give TV networks and advertisers an idea of how many people see the ads rather than TV shows.
Commercial ratings would give an average of all commercial minutes during a show, but already a few media agencies are supporting an even more advanced rating system that provides a minute-by-minute measurement of a commercial’s viewing. It’s understandable that some marketers would be more interested in knowing how many people see their ads in a TV environment where the share of TV “clutter” – non-programming minutes per hour – has increased steadily over the years to around 15 minutes. The “clutter” share can easily be higher during prime-time hours.
Nielsen’s Commercial Ratings system wasn’t ready in time for the Upfronts, but it featured in discussions and is expected to roll out later this month. The other key reason that marketers and networks are keen on new measurements is the impact of PVRs such as the TiVo. According to Nielsen, around 17.2% of US homes now have PVRs, and more homes are taking them with their cable and satellite TV providers’ packages. Marketers are naturally concerned that with higher PVRs penetration in US homes, more viewers may be watching shows later and fast-forwarding through the ads. Some cable operators offer video-on-demand services that allow viewers to watch shows they have missed, but with the fast-forward function disabled during ads. Atlanta-based Cox Communications announced such a deal with ABC for shows like Desperate Housewives and Ugly Betty.
Meanwhile, Nielsen has been offering its clients a new service that measures if a viewer watched a show on their PVR the same day, three days later or seven days later called Live Plus. Measuring PVR usage is an important issue for networks. For instance, Fox executives say they think they lost out on ratings of American Idol, despite its huge popularity, because the current measurement system doesn’t take in to account the impact of PVRs.
CW, the smaller broadcast network owned by CBS and Time Warner, will be experimenting with new ad formats to get around the problem of time-shifted audiences. One idea is to offer advertisers the option of five-second “quickies”, which aim to beat the fast-forward tendency by being too short for the viewer to bother skipping. Another format is for a show to feature no commercial breaks at all, but have an advertiser’s product or services integrated into the show.
Some networks are experimenting with other measurement systems to better read their audience for advertisers. Cable network station Discovery HD Theater signed with media agency Starcom to use a new second-by-second measurement system from TNS. With more and more high-definition TVs being bought in the US every year, there is a need to accurately measure what consumers are viewing, as networks try to estimate their investment in the new HD channels.
Of course, the elephant in the room is online advertising and digital marketing. As a new generation of US marketers get used to the accountability of online advertising, such as search marketing, and their audiences spend more and more time online, TV has to work harder to justify any demands for higher advertising rates or even more advertising. The networks’ cable partners understand this and that their ability to offer more video-on-demand services will be a boost to advertisers. They are pushing for content-providers to make their licensing agreements more flexible, to allow viewers to enjoy their favourite shows in the way they want to.
Whatever happens with the measurement systems, it could be a “make or break” year for advertisers, with many withdrawing funds from TV in favour of online campaigns. But plenty of big name advertisers are still expected from sectors like pharmaceutical, automotive and early political advertising in the run-up to next year’s Presidential elections.
One big name highlighted was AT&T, which is in the throes of a major rebranding effort, following the integration of BellSouth. The $67bn (£34bn) merger between AT&T and BellSouth, approved this year, means the companies that jointly own Cingular Wireless are also working on the rebranding of the mobile phone company as AT&T. AT&T Wireless is the US mobile operator that Apple has agreed to sell its iPhone through. Networks at this year’s Upfront are expecting plenty of ad dollars from iPhone and its erstwhile competitors.
Yinka Adegoke is a New York-based business journalist. firstname.lastname@example.org