• by Wayne Friedman , October 27, 2009

Although fourth-quarter activity may ultimately change TV's advertising picture, broadcast network TV commercial pricing dropped steeply during the summer: 16% versus the same period a year ago.

The average price for a 30-second broadcast TV commercial dropped to $83,916, according to recent analysis by New York media agency TargetCast tcm. The agency says the decline was at a faster pace than in recent quarters, where pricing was down but in the single-digit percent range.

Fox posted the highest average unit cost of $121,000 for a 30-second commercial. ABC, NBC, and CBS were all in the $70,000 to $80,000 range for a commercial unit.

TargetCast does note the effect of NBC's Beijing Olympics in the third quarter of 2008, which was higher-than-normal TV network summer pricing. But even taking the Olympics out of the equation, the news was bad.

"Even without counting the Olympics, which ran in the third quarter last year, ratings among adults 25-54 were down roughly 10% versus the same time in 2008," stated Gary Carr, senior vice president and executive director of national broadcast at TargetCast tcm. He adds that even with some firming of scatter pricing in the period, "dollars in the market were down."

Third-quarter average prices were affected by two main factors -- lower ratings and a weak economy. Also, no new broadcast network programs caught on with audiences this past summer.

Early returns for fourth-quarter results may not follow the dire trend in the third quarter, according to media-buying executives. Many say the networks have been earning double-digit price CPM viewer increases -- which may translate into firmer overall average unit pricing.

While broadcast networks were hurting, cable channels made gains in 3Q. The top 15 cable networks' ratings were up nearly 5% among adult 25-54 viewers -- which pushed up pricing around the same levels to an average $10,000 for a 30-second commercial.

The highest priced networks: ESPN averaged $27,000 for a 30-second commercial, TNT was at $17,000.

Four cable networks witnessed strong ratings in the third quarter of 2009 against the comparable period the year before. Fox News' gains came from wall-to-wall Michael Jackson tribute programming; TLC from the sudden rocketing ratings of the real-life players in "Jon & Kate Plus 8"; USA Network with its new hit "Royal Pains"; and TNT with continued solid ratings from "The Closer."

The TargetCast tcm analysis was derived from syndicated research and tracking data from the NetCosts system, a service of Tarrytown, N.Y.-based SQAD Inc.