A rugged revival

Estimates of the dollar volume for the national TV syndication market are a little vague these days. As a matter of fact, there's no one even in charge at the Syndicated Network Television Association polling members on results. (The search is on to replace SNTA head Allison Bodenmann, whose contract expired late last year).

But industry insiders estimate that the market was down 25%-30% in 2001, making it the hardest-hit ad segment of the TV business.

A year ago, SNTA estimated that the market reached $2.4 billion in 2000. So a 25% drop would have taken it to $1.8 billion last year, and a 30% decline would have dropped it to $1.68 billion. One top-billing syndication ad agency believes business was down by a full one-third, or $800 million, bringing the market down to $1.6 billion in 2001.

Last year, a bad economy compounded already severe competitive pressures, said Jon Mandel, chief negotiating officer at Mediacom, the New York-based ad buyer. "A lot of syndicators got whacked by optimizers," the software that ad agencies use to map out cost-effective buys for their clients, he explained: "They priced the really good stuff too high so that the net reach point was out of line with cable and with network."

The less appealing shows were priced accordingly, but those shows did little to help advertisers achieve their reach goals, he said. "They should have changed their pricing model" before last year's upfront.

Lower network pricing last year made syndication look even more overpriced, says Mandel. "They got caught between lower network pricing and cable, which will forever be a deflationary market."

Twentieth Television Executive Vice President, Advertising and Cable Sales, Bob Cesa acknowledges that it has been a tough season for syndication advertising. "But we're working our way through it. We see good signs on the horizon."

Nobody really knows when a full recovery will occur, but Cesa believes that "we'll see some markedly better results in the second and third quarters. And that should set a better tone for next year's upfront."

As for 2003, the estimates are all over the place. "It's too early," said Mandel. But, unless the market bounces back in a way so far unforeseen, it will take more than a season to recoup the declines suffered in the current season.

Cesa is more optimistic: "I think we hit bottom awhile ago. It's starting to click up."