Two new mini-networks and questions about DVR viewership are throwing a monkey wrench into predictions about the syndication advertising upfront market, but most in the industry believe it will track ahead just a smidgen.
Syndication ad sellers should expect to see a small bump in their overall yearly revenues, growing 2%-3% to just under $2.8 billion from its $2.7 billion 2005 annual number, say industry executives.
Program cost-per-thousand-viewers (CPM) price increases will be flat to slightly up—perhaps 1%-3%, depending on the show—versus a year ago. Early signs are that syndication will be consistent with the overall modest hikes in the rest of the TV advertising market.
“It's a moderate marketplace,” says Mitch Burg, president of the Syndicated Network Television Association (SNTA).
More-specific results will depend on how media agencies account for two new networks in their marketplace estimates. Do The CW and My Network TV get included in the network pool of money, or perhaps just The CW?
“What no one really knows is what was lost with UPN and The WB,” says Larry Blasius, executive VP/director of negotiations for Magna Global USA. “Syndication and cable could stand to gain.”
National advertisers sense that, with The CW and My Network TV, the network marketplace—in terms of total network gross rating points—has seemingly contracted. “With any marketplace contraction” says Blasius, it's going to make people look at other media.”
How much contraction has occurred? One media agency executive says it's 4% of total 18-49 viewer gross rating points. He believes UPN's gross rating points won't be made up totally by the new networks. His view—and the opinion of other agency executives—factors My Network TV as more of a syndication play than a network.
“It's not cable. It's not really a network. It's closer to syndication,” says Lyle Schwartz, senior VP and director of media research for Mediaedge:cia.
For its part, My Network TV says it will behave just like a network, with national ratings and upfront presentations. “We know the agency community is looking at other alternative opportunities,” says Bob Cook, president/COO of Twentieth Television, who is heading up the network's distribution and advertising sales.
Syndication will deal with other factors for the upfront—as well as other TV sellers—than that of DVR viewing. Syndicators continue to wrestle with whether to include DVR-viewing research into their audience guarantees for advertisers.
“We don't want to spend the entire summer dancing on a pin; it's not even a hundredth of a rating point,” says Marc Hirsch, president of CBS Paramount Advertiser Services. “For the last four or five years, broadcast networks have gone before syndication. Hopefully, it will be resolved before syndication goes.”
Another related issue is that of DVR users who fast-forward through commercials. SNTA's Burg says this isn't a problem for syndication because 80% of syndication shows are watched live, the highest percentage of live viewing for any TV medium. Concerning DVR time-shifting, Mediaedge's Schwartz says, “[Network] prime time is more affected. For the most part, syndication will be totally unaffected.”
Says Howard Levy, executive VP of Buena Vista Television Advertising Sales, “Syndication has some inherent advantages, since the majority of shows are stripped, We are not expecting viewers to watch every single show. So, for example, an average Live With Regis and Kelly viewer watches about 2.2 episodes a week. If they don't want on Monday, they'll watch on Thursday.”
Look for long-term syndication figures to stand up well against the recent new-media TV-program distribution deals that include iTunes, Internet, VOD and DVR.
“Syndication has well-known brands that have been around for 15 years,” says Elizabeth Herbst-Brady, senior VP/director of broadcast investment, Starcom USA. “Those shows reach a broad audience, which is the base of advertisers' plans. [When analyzing new on-demand and wireless deals], we are sort of comparing apples and oranges. A cellular-phone screen is different from the big screen.”
Still, media agencies have some issues with syndication. One major complaint is that much of syndication's good efforts don't come with many young demographics. Most afternoon talk, game and court shows get heavy older demographics. “These shows aren't in the sweet spots for advertisers,” says Brad Adgate, senior VP/corporate research director for Horizon Media. “They are not going to deliver 18-34 audiences.”
But syndication does have younger-skewing shows, says Mary Ann Foxley, Starcom's executive VP and media director. “There's Tyra Banks, Friends and That '70s Show, among others.” Not only that, but, says Doug Seay, senior VP of Starcom MediaVest Group, syndication performs better than in the past in a wide variety of viewer demographics.
What complaints does syndication hear about from advertisers?
SNTA's Burg has only one to relay, and that is that advertisers want more high-quality programming, including off-network sitcoms: “They say, 'Gee, I wish you could sell me more [Everybody Loves] Raymond.'” Agreed.