Local ad rates are taking a beating in the wake of the writers’ strike in Hollywood, according to one station executive.
“We should be cranking out Q2 prime 30-second units at $5,000, $7,000, even as high as $12,000,” the executive said. “Without first-run episodes, we cannot get the buyers to assign the ratings to these programs while they are still in repeats.”
Instead, buyers are making offers based on summer ratings, which are cutting prices by more than half in some cases. The effect of the strike on the national market hasn’t been translated into a dollar amount, but at least one of the Big Three--NBC--may cancel its annual springtime upfront extravaganza, according to comments reportedly made by NBC Universal chief Jeff Zucker. Upfronts consist of big TV city fetes where pilots are paraded before media buyers, who cut deals on a majority of ad time for the remainder of the year. This year’s crop of pilots is limited to what was completed or in development before the strike started in early November.
Networks traditionally have as many as 20 or 30 pilots in the works at any one time; a handful of them become regular series. The process has become increasingly expensive, however, and the strike gives networks a chance to re-engineer it. In a recent worldwide employee videoconference, Zucker said NBC could save as much as $50 million a year by scaling back pilot development. NBC, however, has elected to go ahead with pilots already in development, while CBS, Fox and The CW have cut back.
One Hollywood screenwriter said he feared that the traditional pilot model would be abandoned altogether.
“There will not be as many jobs for writers,” he said.
Informal talks meanwhile have resumed between the Writers Guild of America, the union representing the striking writers, and the Alliance of Motion Picture and Television Producers, which represents the studios. Negotiations initially collapsed Dec. 7 over disagreement on residuals material redistributed over the Internet. A deal cut earlier this month between AMPTP and the Director’s Guild of America included a framework for Internet residuals, laying the groundwork for a possible deal between the WGA and the studios.
The WGA has managed some individual pacts--one with United Artists, another with David Letterman’s production company, Worldwide Pants, and a few more with indie studios. Reports emerged today that Lions Gate Entertainment was in contract talks with the Writers Guild.
The approach of the Academy Awards telecast in late February is adding pressure to from both communities to get a deal hammered out. The annual syndication trade show organized by the National Association of Television Program Executives is also set to open in Las Vegas next week. The event amounts to a marketplace for domestic and international syndication of original and second-run network programming. As a result of the strike, fewer second-run episodes are likely to be available for sale.
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