In This Year's Broadcast TV Upfront, Scatter Rules, But Will It, in the End?

We can all get on with our lives now. The network TV upfront is over, ending, as expected, with a whimper. The news outlets I’ve read all agree on one thing — that the primetime revenue take was way, way down, but after that, what really happened is anyone’s guess. Here are the different estimates I’ve seen published:

• Ad Age has the market down from $9.23 billion last year to between $7.8 to $8.1 billion.
• Broadcasting & Cable pegged the upfront at around $8 billion down from about $9 billion last year.
• Mediaweek said primetime revenue is dropping by 22 percent to $7.2 billion from $9.25 billion.
• The New York Times said last week that the total take would be $7.8 billion down from $9.2 billion.

But the low figures aren’t just the result of the still-faltering economy. As predicted on BNET Media, holding back inventory for the so-called scatter market, which consists of ad units that are sold closer to airtime, has proven the way to go. The bet is that wallets will open farther as the economy gets better, with advertisers willing to pay more for ad units later in the year than they were willing to do during this upfront. Every network had to accept decreases in ad rates, even our corporate overlord CBS, which had the clear ratings lead in younger demographics and started out the season hoping to increase its ad rates.

While, in a more normal marketplace, networks would sell about 75 percent of inventory in the upfront, that’s not the case this year — CBS’ Les Moonves said the net is holding back 35 percent of its inventory, using a tactic it hasn’t employed since 2002. Other nets are holding back as much as 30 percent.

While it’s a smart move for the network to take this gamble — particularly with recent evidence that the economic downturn may be bottoming out — there’s one additional element in this year’s TV ad sales stew that wasn’t really there in 2002: the increasing availability of quality video inventory not only on cable but on the Internet. Some upfront regulars in the advertiser crowd were no shows in this year’s upfront; there’s also evidence that unwillingness by some advertisers to pay the rates the networks were asking led them to put more money into other platforms. What we don’t know yet is how those two things connect. While the economy is the principal factor in the upfront market’s declines, don’t be surprised if some advertisers find that in diverting money elsewhere, they can pay the scatter market little mind.

Previous coverage of upfront and scatter at BNET Media:

• NBC Upfront Strategy: Hold Back Inventory For Scatter
• Upfront Update: CBS Says Scatter Is Up, Compared to 2008
• ABC Becomes Latest Broadcast Net to Hold Inventory for Scatter