Upfronts 2010: Scripps Making Big Gains Slowly in Fast Market

Cable network group turning away money in negotiations with ad buyers

By Jon Lafayette -- Broadcasting & Cable, 6/18/2010 2:24:39 PM

Upfront Central: Complete Coverage from B&C

Speed isn't everything for Scripps Networks Interactive during this fast-moving upfront advertising bazaar.

While many of the other major cable network groups are finished making deals, Scripps is still negotiating. But the company appears to be seeing gains as big or bigger than what has been seen as the top end of the market.

"This is a once in a decade marketplace," said Steve Gigliotti, executive vice president ad sales and emerging media for Scripps Networks.

Mr. Gigliotti says that buyers are coming to Scripps with almost 40% more money than in last year's upfront.

"We're not going to be able to take all of that," he said. "We're arguing with people about how much they have to take back."

In terms of pricing, "we're getting incredible CPM growth," he said. Though he declined to be more specific, that would appear to be somewhat better than the mid-to-high single digits other top cable networks are getting, possibly edging into the low double digits.

To be sure, all of cable is having a great upfront.

One buyer estimates that volume for cable could be up as much as 20%, with top tier networks getting price increases in the high-single-digit range.

"There's that old saying that a rising tide lifts all boat. Everyone had a decent upfront," said one senior ad buyer. "They were practically tripping over the money."

Prices were a bit higher than expected, the senior buyer said, which was an indication that "television still works and a lot of buyers want to be there."

NBC Universal cable was one of the first cable groups to finish its negotiations.

"At the end of the day we really did claim the absolute top of the market for all our networks," said Steve Mandala, executive VP, Cable Ad Sales, whose domain includes USA Network, Syfy, Bravo and Oxygen. "We exceeded our goals pretty substantially on both volume and price. So we feel good."

Naturally, executives at Turner, MTV Networks, Discovery, Fox Cable, and A&E Networks, which now includes Lifetime, seemed pleased with their upfront hauls, as well.

Packaged goods remained a strong category for cable, which was helped by the return of the automakers. At the same time, with cable networks gaining reach (and viewership eroding on broadcast), categories such as movies, quick-serve restaurants and retailers that need to get there message out broadly and quickly showed strong significant growth.

In fact, some sales executives were looking forward to a strong scatter market. The lower margin ad dollars being rejected by the bigger cable players is soaking up inventory at the smaller players, they said, setting the stage for a tighter market.

And they're also predicting that the 2011 could be just as good as this year's if the economy shows improvement.