• by Wayne Friedman , June 20, 2007

While cable networks are uneasily positioning themselves to do upfront deals using commercial ratings, Discovery Networks is going one better. It struck a big upfront deal with Starcom USA that will be guaranteed on exact minute commercial ratings.

The deal was short on details--and no financial terms were disclosed. Still, media agency executives peg the deal in the $100 million range. "We thought they had the right product for this deal," said Chris Boothe, President/Chief Activation Officer of Starcom USA.

"It was important for their clients to do minute-by-minute," said Joe Abruzzese, president of advertising sales for Discovery Communications. "We don't have a problem. Our numbers are very good."

For example, Discovery Channel's prime-time household ratings grew 10% this season versus a year ago, thanks to the big-rated "Planet Earth" series.

In the Discovery/Starcom deal, not only will Starcom's clients get exact minute ratings--for deals across some 11 Discovery networks -- but each will include some amount of DVR playback. Starcom executives won't reveal how much each client will get. "It will be a data stream that suits the clients," says Natalie Conway, senior vice president and cable activation director for Starcom USA.

Exact minute commercial ratings are just that--looking at each commercial within a given TV show. This is different than average commercial ratings that many broadcast networks have agreed to this upfront. In that instant, all the commercial minutes in a given program are averaged.

Earlier this spring, Starcom and Discovery struck a trial second-by-second commercial guarantee deal using TNS Media Research data for the Discovery HD network. Last year, Starcom USA did small trial exact minute rating commercial deals with three mid-size cable networks: The Weather Channel, AMC and WE.

Initially, many cable networks had been averse to any commercial ratings, first because of their unreliability. Now that some of those issues have been solved, many cable executives say they'd rather wait until next year to see how commercial ratings perform. However, if the advertisers want it, many say they'll give them average commercial ratings agreements.

A&E Networks executives already said the company is prepared to do commercial ratings deals. Media agency executives say Turner Entertainment Networks are now ready to ink deals this upfront using average commercial rating guarantees. Only MTV Networks is opposed to doing any commercial rating deals--in part because commercial ratings would lower its audiences by some 15% or more.

Still, for exact minute commercial rating deals, there have been questions concerning the stability of the data --that it is too granular and hard to find trends. But Starcom executives say that's just the point: "It is the volatility that we are capturing," said Sam Armando, senior vice president and director of video research for Starcom USA. Booth says: "It's getting closer and closer to perfection, rather than away from it."

"We were concerned about it," said Beth Rockwood, senior vice president of market resources for Discovery. "But when we started looking at numbers in January, for all our individual networks, they were all rock solid."