June 17, 2007 9:00 PM
If you want proof that I’ve been spending too much time talking to people about commercial ratings and ad buying, this is it.
A lot of people have been discussing how commercial ratings will affect the supply side of upfront negotiations, but I haven’t been able to get a good answer to how they’ll affect demand.
It would seem that this year, buyers bought 10 rating points to reach 10 million program viewers, about 9 million of whom watched commercials.
So this year, shouldn’t buyers looking to reach those same 9 million commercial watchers have to buy only 9 commercial ratings points?
That sounds like a 10 percent reduction in demand for ratings points and if supply and demand really govern the market then prices should drop. Instead, the networks seem to be looking for big price increases.
Can that be right? Or is the answer that the price won’t go down because advertisers will be getting charged next season for those DVR users they got for free this year?
Let’s see if someone reading this has a better answer.