• by John Gaffney , April 27, 2003

Two weeks ago it would have been hard to argue that there was anything but smooth sailing between the networks and a five to twenty percent CPM gain. After all, network executives were showing swagger and new programming announcements were being met with muted applause from buyers. But as time goes on, three things are becoming apparent that are slowing the network speed.

The first is reality TV. Recent shows that have underperformed are showing buyers that the reality is very far away from bulletproof. It was no accident that MindShare went public with its research on the genre last week, in which it predicted that reality TV could peak during the summer of this year before settling into a much less profitable and consistent method of programming. Networks are going to have to add to the production value of reality shows, and use new research methods to try and prove their consumer viability before buyers buy in as they did during the past year. It may be a bit late for that this year. Reality shows could actually drop in average CPM.

The second obstacle is sports. Football is the only blue chip left, and rates will rise for the NFL next year. The Super Bowl continues to hold value. The Summer Olympics, once again this year with NBC, continues to be an international hot ticket for global brands. NBC will need to make coverage and programming improvements to keep its price high, but it will get it. The problem is Major League Baseball, which is largely a Fox property on a national level. Check out a baseball game in most markets and you'll see unsold tickets. National inventory won't be quite so bad, but holding a rate increase will be tough.

The third obstacle, and one that hasn't been discussed much is network news. The Iraqi conflict proved to buyers that the mass market is no longer tied to the tried and true of ABC, NBC and CBS News. The TV viewer is spreading attention among cable news stations and the Internet and the 2003 upfront is bound to reflect that. The only issue really to see is whether this will affect networks news programs such as 60 Minutes, 48 Hours, Nightline or Primetime.

Buyers see the rest of the network TV schedule as solid. And the competition for space from the automotive, packaged goods and entertainment categories will carry a CPM increase. But these three aforementioned areas could lead the total take to even up with last year.