• by Wayne Friedman , September 5, 2008

Despite blaring headlines and economic concerns, little of the $9 billion in TV network upfront commitments has been abandoned by advertisers from agreements made in June.

Wild expectations were that many advertisers--specifically automotive advertisers--would be drastically pulling back on upfront "holds" that were made in June. But now that a majority of these expected "holds" on their TV deals have gone to "order," many major media agency executives believe their worst fears have not been realized.

"Normal adjustments, no carnage," said Rino Scanzoni, chief investment officer of Group M.

"Little to no money has been cut," says one veteran network advertising sales executive. "As a matter of fact, we are adding money from the likes of retail, pharmaceutical, and technology. The additions far outweigh any cuts."

Another media agency executive who runs TV buying operations said: "We've had a minor amount [of cuts], but overall, any cuts have been made up by others who've added to their "holds." Flat overall, I would say."

Another senior network TV advertising sales executive echoed other media executives, saying there is no cause for alarm--there was a normal amount of pullback from TV upfront advertisers.

Some media executives say the cuts are far less this year than usually occur. Typically, broadcast networks expect anywhere from 2% spillage.

In regard to the reported TV market upfront figure of around $9 billion, that would equate to networks losing a collective $150 million to $180 million. So far, around 50% to 60% of network upfront holds have gone to order.

While much has been made of General Motors' problems--especially as it looks to trim back its media costs in general--the big automaker has, so far, honored its commitments.

Regarding General Motors' decision to opt out of ABC's Emmy Awards TV show this month and ABC's Oscars Awards next year, executives say those decisions were made well before the upfront market commenced--some time back in March. Little of the automaker's media plans have been affected since the upfront market.

Still, media agency executives said the groundwork was laid for a higher level of TV advertising cuts to occur.

One media executive noted that given the current rocky economy, the expectation would be for higher-than-normal pullbacks on upfront commitments made by marketers.

But the executive notes that media agencies also expected this to happen with the upfront market back in June. Instead, the reverse occurred--as the upfront yielded a strong marketplace, with program price increases in the 7% to 9% range for many networks and a slight gain in overall upfront dollars.