Upfront Central: Credit Suisse Forecasts Upfront Bounce

Investment bank revises full year estimates upwards but still predicts ad decline for full year
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Credit Suisse released a buoyant upfront report April 29, the second from an investment bank this week. Entertainment analyst Spencer Wang forecasts cable will see a 22% bounce in ad dollars versus broadcast, put at 21%. The company's analysis suggests cable will take slightly more of resurgent TV ad dollars than broadcast.

Credit Suisse pegs the upfront total to $8.7 billion for broadcast and $8.2 billion in cable. The analyst is the second Wall Street prognosticator to suggest a big double digit increase in upfront spending. Barclays Capital's Anthony DiClemente released an April 28 report predicting a 20% uptick in upfront dollars, suggesting broadcast networks will hit $8.26 billion. DiClemente, however, thinks cable likely won't see as big a bounce as broadcast.

Credit Suisse is also raising its broadcast and cable outlook, which, despite its rosier upfront prediction, still suggests an overall decline in total network TV ad spend in 2010. Credit Suisse readjusted its numbers predicting a 3% decline in broadcast, down from a 5% to 6% decline with cable now more likely to notch an increase of 4.4%, up from 3%.

"Although 20% growth in the upfront sounds impressive on the surface and should add to the current positive investor sentiment on traditional media, we note that national TV advertising is mature," Wang wrote in the note. "Our upfront forecast is boosted by our expectation that significantly more will be sold upfront (relative to the scatter market) versus last year."

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