• by Wayne Friedman , April 24, 2006

Coming in any upfront season, no cable network wants to be put in a bad negotating position with its advertisers. One of the worst situations is when a media company is looking to sell its cable network.

"There was uncertainty," saiys Bill Abbott, executive vice president of advertising sales for the Hallmark Channel, which was almost in a limbo position of being for sale. "That's never a good situation."

After months of considering possible bids for the 70-million subscriber network, its owner Crown Media Holdings decided to take down its for-sale sign when no buyers were willing to get close to its asking price, say media analysts. The asking price was in the $1.5 billion to $2 billion range.

Hallmark still has a good story to tell, as its ratings have seen big growth over the past year, and advertisers have given it good marks when it comes to its efforts to cut away advertising clutter.

The channel's "Entitlements' efforts for its prime-time movies--in streamlining the number of commercials per hour from a typical 12 minutes to four minutes--has worked well, says Abbott. Typically, each movie contains one advertiser, such as a Kraft Foods has done. That program will continue. In addition, Hallmark has research showing its viewers are "engaged" in its commercial messages longer than all other cable networks. This is according to Nielsen Media Research's Npower research, the network says.

"Our viewers feel comfortable with our brand," says Abbott.

This upfront, Hallmark is looking to upgrade its mix of advertisers and program pricing. About 25 percent of Hallmark's incumbent long-term advertisers pay rates that are well below that of the cable marketplace--stemming from deals Hallmark made years ago when it was a much smaller 25-million subscriber network.

"We are not talking about 50 percent increases," says Abbott. "But we want them to at least recognize our growth. We have committed an enormous amount of money to this network."

As far as the current scatter market is concerned, Abbott says, Hallmark has seen "a fairly strong marketplace. We are getting good significant increases to the upfront. We have had six or seven strong quarters in a row."

Regarding the upfront, Abbott says, like most TV advertising sales chiefs, it is still too soon to tell where the marketplace is headed.

In regard to the current hot topic of video-on-demand programming that advertisers are eyeing closely, he says: "Clients are willing to commit more dollars and CPMs to experimenting. Anybody who can do this has an advantage for a group of select advertisers."