Warner Bros. Domestic Television has decided to pull out of the NATPE convention.
The company, which traditionally has had one of the biggest booths at the annual gathering of the National Association of Television Program Executives, has decided instead to pay for a hospitality suite at the Venetian Hotel in Las Vegas at the same time NATPE is convening at the Las Vegas Convention Center in January.
Dick Robertson, president of the Warner Bros. unit, has long been critical of what he has called a weeklong “schmoozefest” where very little business actually gets done.
In the suite at the Venetian, company executives will have screening rooms where “clients can relax and discuss business-but at a fraction of the cost of being on the floor and 10 times better,” Mr. Robertson said.
The decision was financial, since the company expects to save approximately $1.5 million by cutting the cost of floor space and refurbishing its huge setup.
“By doing this, we’re not dumping NATPE,” he said. “On the contrary, we want to be able to meet with our customers. But because the TV market
starts earlier, combined with the effects of consolidation, we determined that we would be able to make the same sales without a spot on the floor anyway.”
The company will shuttle clients between the Las Vegas Convention Center and the hotel throughout NATPE and will spend some of the money saved on upscale food in its hospitality suite.
In January several syndicators, including Mr. Robertson and Carsey-Werner-Mandabach President Bob Raleigh, openly displayed their dissatisfaction with the market at a panel and declared NATPE to be a costly and ineffective tool for their companies.
Although Warner Bros.’ domestic TV station sales force and media sales force have decided to pull out of the event, AOL Time Warner’s international TV division will continue to take floor space, since the international presence at the convention continues to grow.AOL TV is also expected to exhibit at NATPE. The exhibition plans for New Line TV, another division of AOL Time Warner, were unclear at press time.
“It’s comforting to know that AOL and Warner Bros. International will continue their presence on the floor, but it’s regrettable that the domestic sales division has opted to pull out of the floor,” said NATPE President Bruce Johansen. “I look forward to them returning at some point. But we don’t see this having an impact on the organization economically. We are coming off record-setting attendance levels as our new media, international and advertising presence continues to grow.”
Mr. Johansen said annual anchors Paramount Domestic Television, Columbia TriStar Television Distribution, Studios USA Television, Twentieth Television, Tribune Entertainment and Universal Television will all return to the floor in 2002. The one wild card appears to be Carsey-Werner-Mandabach, which has yet to decide whether to reserve floor space or not.
If Warner Bros. opts to return to the floor, it won’t be for a number of years. Company execs have already made arrangements not only at the Venetian in Las Vegas next year but also in New Orleans for the two years after that. In 2005, NATPE will be held in Atlanta, where Mr. Robertson has made plans to reserve hotel space.
“We did a survey among our key clients and determined that less than a third even attended the convention,” Mr. Robertson said. “That makes it difficult to justify spending a million and a half in direct expenses on the booth alone for only a day and a half of business.”
Mr. Robertson has said a number of times in the past that the anchor studios should be offered incentives to bring in the rest of the players.
“You know, in the real-estate business when you build a shopping center, the anchor tenants, the Neiman Marcuses and the Sears and the Robinsons-Mays, they sometimes get paid by the developer to come in,” he said at Electronic Media’s syndication roundtable last November. “They get all kinds of breaks and everything. NATPE should pay us to come. Eighty-five percent of the sales are made by seven companies, so it’s backwards. You’re right, the advertisers come, kick tires, look at the shows [but then] spend no money.”
Other syndicators have recently voiced similar sentiments.
“We continue to support NATPE, but we’d be silly to not recognize the business is completely different,” Frank Kelly, co-president of Paramount Domestic Television has said. “… It continues to be a terrific place to sell weeklies because decisions are made later in the process. For strips it’s much more difficult. But I can tell you our company looks at the cost of that convention every year and goes, `Whoa, it’s a lot of money.”’
But for Mr. Johansen, NATPE will continue to evolve with or without the syndicators.
“Consolidation has indeed caused fewer general managers to attend, but all the decision-makers are still present,” he said. “It’s a lesson in cost efficiency. This year saw the dollar volume go way up in deal-making, and we expect that to continue.”