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Networks, Ad Buyers Jostle to Try to Spark TV’s Upfront Market

TV networks and advertisers have begun early-stage negotiations as part of the industry’s annual “upfront” ad-sales market, according to six people familiar with the pace of discussions.

No one is believed to have begun writing business with any degree of earnestness, and several executives caution that marketers have yet to file their full budgets. Indeed, the ultimate shape of the marketplace remains unclear, with buyers suggesting volume of advance ad sales will be down in 2017, while some senior TV executives hint money might be up. “I’m not sure why anyone would rush in and cut pricing if they don’t even know what demand looks like,” said one media-buying executive

But the uncertainty hasn’t kept players on either side of the bargaining table from trying to spark an early deal.

Billions of dollars are at stake. Each year, as part of the upfront, U.S. TV networks try to sell the bulk of their commercial inventory for the coming programming cycle. In 2016, the nation’s five big English-language broadcast networks secured between $8.41 billion and $9.25 billion in advance ad commitments for primetime, according to Variety estimates –  the first time in three years they’ve managed to break the $9 billion mark.

There is strong doubt they’ll be able to the same this year. “No one thinks it’s shaping up to be a market higher than year ago on rate of change or volume,” the media-buying executive said.

There has been speculation in the marketplace that Omnicom Media Group, the parent unit representing agencies that buy ad time for Procter & Gamble, Apple, AT&T and Pepsi, among other blue-chip marketers, has been kicking tires to see if specific networks might be willing to do an early deal. A spokesperson for the Omnicom Group unit was not able to make executives immediately available for comment.

CBS, NBCUniversal and ABC are among the media companies that have begun having discussions, according to the people familiar with the talks.

The haggling is unlikely to be wrapped quickly, people on both sides suggested, owing to a host of issues at play. Marketers need to consider their overall media mix, said one buyer, and determine how much to allocate for traditional TV and how much to earmark for other kinds of video. Advertisers and media companies continue to struggle with measurement of new kinds of video viewing. And many media companies are offering new kinds of data that take time for clients to understand.

Media buyers expect CBS or NBCUniversal to set the tone of the market this year, owing to a broad array of new executives put in place to head ad sales at Viacom, Fox Networks Group, Discovery Communications, AMC Networks, and Disney/ABC Television Group. NBCUniversal’s Linda Yaccarino, chairman of advertising sales and client partnerships, and CBS’ Jo Ann Ross, president of advertising sales,  have the most significant properties to sell. Others with experience include Keith Turner, president of ad sales and marketing at Univision and Rob Tuck, executive vice president of national sales, and Turner’s Donna Speciale. She brings with her a unique perspective from her days as a senior buyer at the MediaVest buying agency.

Before the market moves significantly, some clouds have to clear.  In the meantime, both sides are engaged in plenty of chatter.

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