It’s in almost everybody’s interest to try and gin up excitement for next week’s major TV network upfront presentations: The celebrities are lined up, and the shrimp and booze ordered, in an effort to entice ad buyers to conditionally bet billions of dollars on shows that haven’t been written yet, and ratings points that can’t be accurately measured. Wall Street analysts say that CBS will be the big winner in light of its strong ratings. For example, Credit Suisse’ Spencer Wang predicts this morning that CBS will record commitments of $2.8B (+4%), followed by ABC at $2.4B (+2%), Fox at $2.0B (+2%), NBC at $1.7B (no change), and CW at $477M (-1%). But for the most part, analysts are preparing to yawn. “As it currently stands,” RBC Capital Markets’ David Bank writes this morning, “broadcast year 2012/13 is setting up to be a ‘boring’ year for network TV advertising, with few surprises.” He reflects the consensus view that advertisers are less likely to be stampeded into making deals than they were last year. The economy looks wobbly — nobody knows how the European debt crisis will play out — and overall TV ratings continue to slide. Demand from auto companies is robust “but likely will decelerate,” Bank says. Meanwhile pharmaceutical companies have been standoffish “and likely will continue to remain so for the foreseeable future” with fewer new products teed up and some major patents due to expire. Also, this year AOL, Google, Hulu, Microsoft, and Yahoo staged upfront presentations in an ambitious effort to lure dollars that ordinarily go to traditional TV over to Internet video.
The bottom line: Wang says this morning that advertisers’ upfront spending for ABC, CBS, CW, Fox, and NBC will rise 2% to $9.3B with unit CPM prices +7%. And cable will be up 4% to $9.7B, with CPMs +6%. Bank is less specific but says advertisers will spend just 1.3% more on the broadcast networks than they did last year, and 6% more on cable as unit CPM prices rise about 6% for each. Just to show how variable these predictions and the underlying data can be, consider the forecast that Barclays Equity Research’s Anthony DiClemente made two weeks ago: He said that spending at the Big Four broadcasters will rise 4.3% to $9.5B, while cable will be +6.3% to $9.9B. He projects CBS with $2.9B (+10%), ABC with $3.7B (+5.8%), Fox with $2.2B (-2.1%), NBC with $1.8B (+1.4%) — and no forecast for CW.
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