• by Wayne Friedman , Staff Writer, June 3, 2011

Taking a break from the upfront talks this week, one media agency executive mused about how far the business has come in 20 years -- since 1991.

The key question, he says, is "What has changed in regard to upfront TV negotiations since then?" "Absolutely nothing," he answers. Mind you, I don't think this media agency executive has an alternative.

TV networks always ask for high initial price hikes knowing they'll get less. Fox started asking for 14% hikes this year and got around 11%. CBS is asking for 18% gains -- but in reality, does it really expect to get that?

Nothing is wrong here. Modern business dealings are the same everywhere: Ask for more than you really think you can get,and hope to settle for a bit more that your real bottom line.

Last year's upfront yielded a modestly strong 7% to 8% cost per thousand price increase, and subsequent 30% gains in scatter. That sounds like a decent marketplace. Many might say everyone left some money on the table. But did they really? If you believe money was lost, where did that money go? Turner, USA Network, Google, digital billboards, Hulu?

For years, new digital platforms have positioned themselves to grab "TV upfront dollars." Many digital advertising conferences focus a lot of attention on where digital advertising money is coming from, usually asking, "Was it from TV budgets?" We are all still waiting for those answers.

The reality is that alternative TV-video-other digital media has been growing -- and just not in the usual big ad-selling time periods, like the upfront. Les Moonves, president and chief executive officer of CBS Corp., kidded -- during a media conference on Thursday -- that he might only sell 20% of CBS' inventory in the upfront, all to get what he believes is a fair price.

Sure, negotiation hasn't changed in two decades. But selling just one-fifth of a traditional network's inventory in the upfront? Yes that would dramatically change the way TV negotiates with advertisers.