GM's Oscars Pullout May Be Tempered By Upfront-, Olympics-Fueled Optimism

by Wayne Friedman, Aug 27, 2008, 4:00 PM

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General Motors out of the Oscars?  Don't worry ABC; just consider TV marketers' strong belief in the current state of big-event TV.

As we have just seen with the Olympics this year -- and with the Super Bowl earlier this season. which garnered the second biggest TV viewership of all time for a single event -- network TV is still pretty healthy, especially with big events.

GM's usual $13 million commitment to the Academy Awards   is, no doubt, a huge chunk of the entire TV advertising take for the network that night. But the company's pullout is not an insurmountable hurdle, especially with around six months of selling to go.

Last season, the Oscars cost advertisers a big $1.7 million for each 30-second commercial, typically the second highest-priced 30-second commercials on broadcast television. (The Super Bowl holds the title, charging the most at just under $3 million).

From its prime-time broadcast, as well as related programming before and after the event, ABC pulls in around $120 million to $130 million from its Academy Award involvement. GM's part in all of this came to roughly 10% of the whole take.

In ABC's favor is that fact that for years, national TV advertisers have coveted the Academy Awards TV inventory, with few perennial Oscar TV advertisers giving up their incumbencies each year. Considering the decreasing number of high-rated events that land on TV each year, the Academy and ABC would seem to be in the driver's seat.

This is not to say there aren't some pressing issues marketers have to attend to in the next few months, as the economy, potentially, slips into the negative growth arena. But six months from now, a lot could change

In ABC's favor is that it does many of its Oscar deals during the upfront advertising market, which, this past June, was a relatively strong market.

And consider this: For the first time in years, ABC has the possibly luxury of finding that mainstream, big-box-office movies are back in vogue, as the whopping success of Warner Bros.' "The Dark Knight" is showing.

That means ABC could be driving without GM behind the wheel to some big ratings, possibly the likes not seen since "Titanic" in 1997.

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