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Upfronts Aren’t Everything, Myers Says

NEW YORK: The upfronts, where advertisers make big package buys of TV time for the upcoming season, are not an accurate predictor of how the year will unfold, according to Jack Myers, a long-time industry analyst.

“Again this year I am urging my colleagues in the press, on Wall Street, at media agencies and at networks to avoid reporting on upfront investments,” Myers wrote in his blog. “For the past few years, I have steadily reduced my coverage of the national television upfront market based on my conviction that press coverage does a disservice to both network TV advertising buyers and sellers.”

Myers said upfront coverage in the past has been inconsistent. He said the five broadcast networks generated between $7.9 billion and $8.2 billion in the upfronts last year, rather than the $9 billion frequently reported.

“Wall Street analysts have continued to use and report the higher figure,” he said. “Year-to-year data becomes irrelevant in this context, and insights on cost-per-thousand differential are dependent on too many variables to be meaningful.”

Myers said it was also “increasingly irrelevant” to consider broadcast networks alone, given that so many other platforms are integrated into the deals. Dollars are also migrating toward calendar-year agreements rather than those associated with traditional TV season. Another factor affecting this year’s trade is that advertisers are confident that scatter prices will stay close to upfront prices, or possibly drop.

“So while upfront deals offer certain key advantages, the historic supply/demand curves have been inverted. It's unlikely that many marketers will have visibility on business conditions in May and June for the fourth quarter 2009 and into 2010, and they have little incentive to make long-term commitments,” Myers said.