Syndication May Go First in This Upfront

by Paul Gough, Mar 17, 2003, 12:00 AM

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Will syndication go first in this year’s upfront?

Carat North America CEO David Verklin said at an industry gathering last week he believed that syndication would be sold first this year. He said that the timing of the upfront in general was “a bit absurd,” as it asks clients to put down money in advance of having a media plan done for the year. But the short-term nature of television – being able to quickly move products – is driving what Verklin called an advertisers’ “retreat” into TV. “TV is still how [they] think about moving merchandise short-term,” he told the Association of National Advertisers in New York.

Last year, syndication followed the broadcast upfront. Syndication National Television Association President Gene DeWitt heard Verklin’s prediction but he said he wasn’t sure syndication would go first. He said he felt it was more likely that “syndication will move with the networks.” He said it was too early to tell for sure and it would be determined by the market.

DeWitt said years ago, syndication went first but that in recent years it had occurred after the networks. But he said a limited inventory – and the fact that syndicators sell about 80% of their inventory during the upfront – was creating a bullish market. “If they want to get into the high-rated shows, they have to move quickly,” DeWitt said of advertisers’ thinking behind going ahead on syndication. “That, I think is the new paradigm, that we will move with the networks,” DeWitt said.

Pricing could be as much as 10%-15% higher this year, according to some reports. Bruce Johansen, president/CEO of the National Association of Television Program Executives, said several factors are working in favor of syndication, including last month’s SNTA conference in New York and the strong ratings of Dr. Phil. “Dr. Phil changed people’s feelings about the syndication business,” Johansen said.

Johansen and DeWitt said syndication was becoming more like a network buy, between coverage and a stronger network distribution mechanism that works more effectively than ever before. Johansen said the syndicated day in, day out product is just like a network.

The upfront follows what has been a year of recovery for syndication. A CMR/TNS report released last week said that ad revenues in syndication dropped 7.7% in 2002, from $3.192 billion in 2001 to $2.945 billion. But DeWitt said that the year finished up stronger, up 7.4% in November and 9.4% in December. DeWitt said the syndication billings were strong continuing into the new year. “In the first quarter, our members have been selling out whatever inventory they have had. The numbers are up,” he said.

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