Fox Cuts Commercials, But Not Price

by , May 18, 2008, 11:06 PM
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Just when you thought the upfronts were going to be head-scratching or yawning affairs, Fox offers up a new, dramatic equation for advertisers: fewer commercials and more television.

How can you beat that?

"It is potentially revolutionary," says Peter Liguori, chairman of Fox Entertainment. Fox is cutting national advertising time in half for two of its new dramas. Fox calls its "Remote-Free TV."

Critics may sneer: "Why don't they do this for its big shows, like 'House' or '24'"?  Baby steps, I say. Marketers have long complained about commercial clutter.

But what about Fox's math when it comes to TV production costs?  How can Fox possibly make ends meet when it comes to paying for those dramas?  

Fox has been positioning this as a clear positive for marketers -- that those five precious minutes of national advertising time should get a premium. But to get the math close, those premiums would see unit prices close to double what they were under the old system.

That's not likely to happen -- unless perhaps Fox is able to, say, persuade an advertiser to buy up the entire inventory load in a particular episode -- as the networks now do with episodes streaming on the Internet.

Perhaps the thinking is that since many new shows are already behind the eight ball when it comes to profitability, why not see if viewers respond to more content and less commercial messaging with higher ratings?

TV networks have offered TV shows with limited commercial interruption before - but not a whole season's worth of shows. Typically, it might be for a premiere.

To be fair. some cable networks already do some of this, trimming back commercials loads for certain programming. Hallmark Channel has been doing this for some time with its home-grown TV movies. TNT followed Hallmark's lead -- also for movies.

TV watchers say all eyes will be on Fox to see whether its financial-advertising equation shifts - to other programming. One media buyer wondered if, to make up the difference , whether Fox would add more commercial units into other shows. In the past, some networks with strongly rated shows have been known to add more commercials.

Remote-free TV? Not free, but perhaps less handled.

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