UPN Advertising Revenues IncreasingBy Lisa
June 26, 2001 - 5:22 PM
Despite a major downturn in the advertising market this Fall, UPN is expected to weather the storm. Predictions say the network will make a $250 million profit - $50 million up from last year - and is attracting a wealth of new advertisers.
However, the network traditionally suffers from slow sales during the advertising upfront, the period in which television networks pre-sell advertising inventory for the upcoming season. As a smaller network, UPN usually only concludes its deals with advertisers after the remaining networks have already sold out.
On the plus side, more than a quarter of the deals UPN has already closed are with new advertisers, according to Media Week. The acquisition of Buffy the Vampire Slayer and Roswell has caused some advertisers to migrate from the WB; while Enterprise's expected solid performance also made the network more interesting to advertisers.
UPN is apparently selling spots on Buffy for less money than the WB used to charge. As UPN will pay a higher license fee than the WB, it seems unlikely it will be able to directly profit from the show. But since the acquisition of these shows will likely also lead to more advertising being sold on UPN's other shows, the net result for the network will still be positive.
CBS, home of high profile shows like Survivor has also been hit by slow sales. Rival networks NBC, Fox and ABC have cut prices in an effort to bolster the flagging market. As a result, these networks are expected to complete most of their upfront business by the end of the week. CBS has refused to bow to pressure and cut its own prices, confident that its strong programming line-up means advertisers will buy eventually.
Among the other networks, NBC is again expected to end up as the market leader, even though the $1.9 billion it is expected to earn is sharply down from last year's $2.2 billion. ABC has suffered from an over-saturation of Who Wants To Be a Millionaire? and is expected to see profits fall by as much as $1.8 billion. The Fox network has been buoyed by an increase in 18-49 year-old viewers, and has been able to keep prices level with last year. It is predicted to make sales of $1.3-4 billion.
The above figures are quoted from this Variety report.