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5/11/2003 08:00:00 PM Eastern
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ESPN Defends Rate Hike

Agencies

Campaigns

ESPN Defends Rate Hike

ESPN defended against MSO criticism of its latest annual license-fee increase with a fact sheet released Tuesday that talked up the benefits that affiliates derive from ESPN and its various sibling networks.

ESPN and ABC Sports President George Bodenheimer
told Tuesday's Senate Commerce Committee hearing on cable rates, "ESPN is a major contributor to cable's success."

According to the fact sheet, the various ESPN networks "will generate almost three-quarters of a billion dollars" in local ad revenues for operators this year.

Operators pay about $11 per month per subscriber for basic-cable programming, ESPN reported—of which more than $4 a month per subscriber is recouped by local ad sales.

For ESPN alone, Bodenheimer said, local ad sales "offset a significant portion of the wholesale cost" to operators via the affiliate fees. "As a result, the net wholesale cost for ESPN is about $1 a sub per month."

Agencies

The Gap Inc.
concluded its recent review, keeping its TV buying at Omnicom Group's PHD USA, New York. PHD will continue handling media for the company's retail chains, The Gap, Old Navy
and Banana Republic. All told, the company spent more than $240 million on broadcast and cable last year, by TNS/CMR estimate. ...

Virgin Atlantic Airways
wrapped its review, choosing Miami-based Crispin, Porter & Bogusky
to handle its U.S. creative. Crispin replaces CMG Communications, New York. The account is estimated at $10 million-plus. ...

Omnicom Group's TBWA/Chiat/Day, New York, beat out Havas's Arnold Worldwide, Boston, for the estimated $150 million-plus Nextel Communications
creative account. Nextel's media-account review is ongoing, with contenders Havas's Media Planning Group; Omnicom's PHD; Publicis' Starcom; and Nextel's media incumbent Interpublic's Initiative Media. ...

Federated Department Stores has concluded its lengthy account review by selecting Interpublic's Lowe & Partners, New York. Lowe beat out finalists BBDO Worldwide, New York, part of Omnicom, and Campbell-Ewald, Warren, Mich., part of Interpublic. Federated, which previously handled its account in-house, will focus its initial TV and print creative on Macy's
next holiday-shopping campaign. The estimated $20 million account is the first win for Lowe since its recent merger with Interpublic's Bozell.

Campaigns

Danke Schoen, Wayne Newton, but it's time to say auf Wiedersehen. AFLAC's TV duck is getting a new costar: Chevy Chase. In its latest spot, titled "Supermarket," Saturday Night Live alum Chase is recognized by fellow grocery shoppers, who then ask him to fall down à la his physical-comedy skits on the NBC late-night series. He declines, saying, "After all, it's not like I have that insurance"—although, like most of the characters that have appeared in the spots, he can't quite recall the company's name. The AFLAC duck drops a box of Wheaties on Chase's head and squawks, "AFLAAAC!" By the end of the spot, Chase is just about the only thing left standing in the store. Kaplan Thaler Group
created the spot. ...

Sheraton Hotels
last week broke its latest broadcast and cable campaign, themed "Let's Spend the Night Together," featuring a cover version of the Rolling Stones' once controversial song of the same name. The campaign focuses on the chain's service and hotel improvements as well as such amenities as the "Sweet Sleeper" bed. Sheraton hasn't advertised since 1999 and then only in print. Interpublic Group of Cos.'Deutsch, New York, is the agency on the campaign. Sheraton's media budget for this year is reported at $25 million. ...

Seinfeld alum Julia Louis-Dreyfus
is appearing in Commerce Bank's new broadcast-network campaign. In one spot, the actress, having been rebuffed by a teller for trying to exchange coins for paper money, grabs a Commerce Bank newspaper ad and jumps on a desk to raise the ad—à la Sally Field's union campaign in the film Norma Rae. ...

Responding to requests from more than 200 cable systems, the Cabletelevision Advertising Bureau created a 15-minute reel, containing pro-cable sound bites from more than 30 celebrities. The spots, shot during last January's Television Critics Association
tour, feature such names as Tom Selleck, Kelsey Grammer, Erin Brockovich, Jacqueline Bisset and Ed Asner. Each spot talks about cable's appeal to creative talent and concludes with the tagline "Cable—the Power of Choice."

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