Harbert's Upfront Screed Resonates, Ergen Avoids One



NBC’s Ted Harbert offered one of the more memorable performances at an upfront presentation a year ago. No, he didn’t sing or dance to get attendees excited about a new show. He postured.

If upfront events are about luring advertisers, Harbert surely turned a lot of them off from the start. The NBC broadcasting chief said at Radio City that the industry needed to shift to a C7 currency, a favorable move for programmers.

Less controversial with those who spend big money was Harbert’s condemnation of Dish Network’s AutoHop, the DVR functionality that automatically removes commercials. “This is an insult to our joint investment in programming and I’m against it,” he said.

He did conclude by poking some fun at himself by suggesting he was a pretty bad opening act. So, what does he have in store for Monday morning when NBC introduces its new fall schedule?

Will it be another screed? Certainly, Aereo is out there to blast.

The bet is that won’t happen. The more Big Media executives rip the Barry Diller-backed service, the more potential customers take an interest. Aereo’s free publicity is remarkable.

Another bet is if Harbert speaks, he’ll come in peace. Perhaps, he’ll offer a joke about being much calmer this year. Or, one about being more focused on improving NBC’s ratings -- so viewership will be impressive whether the currency is C1 or C100.

It’s likely that a hullabaloo over a C7 switch would have emerged whether Harbert had given it such high-profile attention or not last May 14. The same dynamic holds with the AutoHop, considering it's given rise to extensive litigation where NBC and brethren are looking to shut it down.

But Harbert’s public positioning has to be considered a seminal moment in the interest level the media and industry have continued to have in both matters. Without his rhetoric, does WPP CEO Martin Sorrell address the C7 matter on Friday in a New York appearance?

Sorrell said the networks have a “strong argument” for it -- score one for Harbert? -- but that's his personal view, not necessarily one held by GroupM, which will have a lot to say in what eventually happens.

The AutoHop continues to get considerable attention in the appearances the hard-to-read Dish Chairman Charlie Ergen makes. Reporters and analysts -- some spurred by Harbert's diatribe -- are eager to know whether the Hopper DVR (which offers the AutoHop functionality) is simply a ploy to get networks to charge Dish less in carriage fees?

Nowadays, the media at-large may be more interested in Ergen because of Dish Network’s attempt to buy Sprint and enter the wireless business. But the Hopper could have them buzzing come September. Its long-term impact may very well be decided as ESPN and Dish look to renegotiate a carriage deal by then. ESPN sister network ABC is one of the entities suing Dish, charging the AutoHop is illegal.

Equally as unpredictable as Harbert’s upfront appearance last year are Ergen’s comments, which came at a rapid clip this week on a Dish earnings call. A quick Hopper update: Dish is moving full-steam ahead with the product, launching capabilities to watch live TV on the go and download content to a mobile device that’s viewable even without an Internet connection. Networks might have less objection to these functions as opposed to the ad-zapping and ability to automatically record shows, but still want to get paid for Dish to offer them.

As for Hopper consumer uptake, Dish executives didn’t offer specifics, but said both surveys and purchases offer positive trends, though it will take time to determine the ultimate revenue and subscriber impact. At one point, CEO Joe Clayton said: “We’re selling Hoppers probably at a faster take rate than we might have thought originally.”

Ergen said he thinks DirecTV has been more effective in marketing its Genie DVR than Dish with the Hopper. Of course, he said part of that comes as the Big Four broadcasters won’t sell it airtime. Instead, Dish appears to be investing heavily on cable networks such as AMC (where it’s been airing spots during “Mad Men”) and TNT, where it’s sponsoring the NBA playoffs.

It’s not clear whether any broadcasters would believe him, but Ergen spent a chunk of the call with a sort of “let’s-work-together” approach towards his broadcaster combatants in the courts.

He acknowledged Dish may have bungled its announcement about the Hopper, which came right before the broadcast upfront week last year and prompted Harbert’s condemnation not long after.

“I don't think they're happy with us for bringing (changes in TV advertising) to everyone's attention the way we did it, maybe," he said. "And our timing really maybe wasn't as good as it could have been. But I think they recognize that, in fact, the model is changing and I think that they recognize that we agree with them on the two-income stream model.”

Ergen more than once suggested Dish has no intention to fight to abolish retransmission consent payments. In fact, he didn’t refer to Aereo – which broadcasters also are suing – as anything close to a friend.

Yes, it’s ability to stream live TV online is “super innovative,” but “all things being equal, we'd prefer to work with the broadcasters.”

Ergen did reiterate support for a la carte channel offerings, which Big Media companies with broadcast and cable channels oppose. But, he suggested all sides lose if bundles lead to higher prices that push customers to over-the-top and other less-expensive option or even to “steal programming.”

“So ultimately, there's got to be creative ways to make sure you satisfy the customer needs,” he said.

For some people, 200 channels is the most efficient option because a la carte may be more expensive for them, "but there's an awful lot of people that just don't watch -- don't consume anywhere close to that number of channels and in this economy, they're looking to save money everywhere they can.

“And as an industry, we have to be able to accommodate them … Ultimately I think the programmers themselves will figure that out as well.”

"Ultimately," though, could be a very long time.

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