ABC has started negotiations with advertisers and may be selling some ad time in the 2014-15 television season, as the network joins others in starting their upfront sales, Brian Steinberg reports in Variety.
Steinberg writes: “ABC joins what media-buying executives — who have an interest in tamping down the market — characterize as an upfront moving at a “snail’s pace.” Advertisers are registering less money for TV advertising than they did in 2013, and their representatives are pressing for price increases that, if agreed to, would be some of the smallest in recent memory.”
Ad buyers are seeking CPM increases below 5%, while networks want increases that were on par with last year, the story notes.
"Deals with CPMs in the low-single-digit percentage range would mark continued erosion in TV networks’ leverage in the annual haggle," Steinberg writes. "In 2013, CBS secured deals with an average CPM increase of 7.5%. The CW secured … CPMs of between 5% and 6%. ABC pressed for CPM hikes of between 7% and 8%, though it’s not clear what success the network had in doing so. NBC, meanwhile, sought CPM hikes of between 7% and 8% last year."
Steinberg adds: “If the networks are to consider the small increases, buyers said, they want to be assured they will be rewarded with a more robust volume of dollars than they might normally otherwise get. That counteroffer would slow things down, as giving more money to one outlet would likely require clipping the amount earmarked for another."
The report also notes: “Already, there is some ballast to the buyers’ suggestion. Fox has begun selling, with some deals coming in with CPM increases of 3% to 4%, according to a person familiar with the matter. The network typically tries to drive volume with favorable price increases.”