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NETWORK NEWS: BROADCAST AD MARKET ALL TAPPED OUT?
Published May 16, 1995
"For the first time ever in an adult TV marketplace, broadcast network sales managers are talking about rationing, or 'capping,' the amount of time any given advertiser can purchase," according to the latest AD AGE. The practice, seen only before in the kids TV market, would set a "predetermined level" for '95- 96 -- "probably no more than an advertiser's previous year's budget." When the market closes (possibly as early as June 4), a "record" of more than $10B in upfront ad deals for national broadcast and cable TV will have been committed with price increases reaching as high as 20% over '94-95. The Olympics and '96 elections will only increase competition. The expected $1B in sports upfront sales "got going last week, as major incumbent NFL advertisers began negotiations for next season (Joe Mandese, ADVERTISING AGE, 5/15 issue). REVENUES OFF: Network revenues for NBC, ABC and CBS fell 7.8% in the 1st quarter to $2.04B from $2.21B in the same period in '94. A decline in sports revenue was one reason cited. Net revenues for sports fell 44% to $444.4M for the quarter, due to the absence of the Olympics which boosted the same period in '94 (WALL STREET JOURNAL, 5/15). OTHER EARNINGS REPORTS: TCI reported a $53M before-tax loss for the quarter ended March 31 vs. earnings of $32M in the year- earlier period. The company noted that its 1st quarter results do not reflect its August merger with Liberty Media (TCI)....Turner Broadcasting said that its lack of sports rights fees helped boost its operating profits this past quarter. Turner bore rights fees for the Winter Olympics in '94 (BROADCASTING & CABLE, 5/15).