The TV upfront season is when broadcast executives are on edge. The networks sell 70 percent or more of their ad time before summer ends.
And after some rough years recently, this one could be a good one for network execs.
Analysts at Nomura, observing a “surge in TV ad demand,” believe we’ll see a “return to year over year growth in upfront commitments.”
Behind that prediction Nomura points to a current “robust consumer economy.” Coupling that with low unemployment and strong auto sales increases (broadcast TV ad spend for the car category is up five percent year over year for January and February), Nomura estimates a 5.5 percent dollar growth in total broadcast commitments, reaching a total of $8.8 billion.
Last year, the post-upfront scatter market – where ads are sold on more of a last-minute, a la carte basis – proved quite expensive, so networks might be able to push media buyers to spend more than last year.
Here’s how the predicted growth breaks down, per network, on a percentage basis:
Fox: +11.8%
CBS: +5.9%
NBC: +3.2%
ABC: +2.8%
The Fox growth illustrates how poorly by comparison that network performed during the prior upfront period. It’s also perhaps reflective of Fox’s still-unimpressive TV ratings being relatively steadier than the competition’s — a low starting point and a low ending point means more stability.
The projected small gains for ABC underscore the low ratings it’s endured this season, and perhaps a pinch of concern over the broadcast channel’s changing of the guard. Next week’s upfront will mark Channing Dungey’s first turn as president; Paul Lee was ousted earlier in 2016.
On a dollar basis, Nomura expects CBS to be No. 1 yet-again, this time with $2.49 billion of that $8.8 billion. They see NBC coming in second at $2.39 billion, ABC finishing third with $1.85 billion, and Fox defaulting to fourth at $1.71 billion.
Here’s a handy grid from the analysis company SNL Kagan, showing growth estimates beneath historical comparisons:
That aforementioned 1-through-4 order happens to be the same way the Big 4 networks lined up this season in total viewers. In the key 18-49 demographic, however, Fox leap-frogged ABC, thanks to the NFL Playoffs.
In addition to an overall eyeball advantage, ABC should still beat the younger Fox this upfront season due to the stability of Dungey’s inherited lineup and her relative lack of unproven properties, Nomura suggests.
For NBC, the addition of some “Thursday Night Football” (“TNF”) will be quite enticing for advertisers. Despite being top dog these days, CBS procedurals should disproportionately benefit from the expanded definition of viewership — aside from the rest of “TNF,” there’s not much “must-see” live CBS programming.
Another way to look at movement is a network’s CPM pricing, or cost-per-thousand viewers. Nomura forecasts CBS will lead the pack there with 9 percent growth, ABC will fare 8 percent better this year than last year, and both Fox and NBC will rise 7 percent versus 2015.
Additionally this period, analysts see aggregate sell-through rates (number of units sold per month) growing by 260 basis points.
Plus, as C3 (average commercial minute, inclusive of three-days of delayed viewing) supply continues to shrink, inventory sold on a C7 basis should increase, and maybe even become the currency for 75 percent of transactions, Nomura said.
Finally, advertisers may be thought of as returning to TV after a flirtation with digital — a medium increasingly viewed as complementary to TV ad buys rather than a substitute.
“We believe several large brand advertisers have begun to question digital’s effectiveness after devoting significant ad dollars to experiment with different forms of digital mediums last year,” Nomura wrote in its study. “Specifically, issues around view-ability, targeting, and engagement remain gating factors to accelerated budget allocations towards digital.”
“These dynamics perhaps led marketers to believe that TV ad budgets shifted too quickly towards digital alternatives (particularly smaller digital players), and we believe the recent strength is, at least in part, a result of some of the ad-dollars returning to TV,” analysts concluded.
NBC and Fox will hold their upfront events on Monday, ABC is Tuesday, CBS will clean up on Thursday.
31 Shows at Risk of Cancellation - and Their Survival Chances (Photos)
Will your favorite show be canceled or renewed for next season? TheWrap looked at several factors to see if several low-rated shows -- from "American Crime" to "Sleepy Hollow" to "Criminal Minds" to "Undateable" to "Nashville" -- will be back this fall.
"American Crime" (ABC)
"American Crime" gets great reviews, and brings prestige to ABC's lineup. It looks likely to survive.
"Castle" (ABC)
"Castle" has had a long run, it's expensive to produce, and it's already syndicated, which means lots of money long-term. ABC has to calculate: What does it have to gain by keeping the show on the air? The news that Stana Katic is exiting the show could, counter-intuitively, be a good sign: It would be less expensive to produce, in theory.
"The Muppets" (ABC)
It's ratings won't blow anyone's mind, but coupled with delayed viewings, the show hits the "good enough" level for a sitcom. And ABC took a big swing with this "Muppets" update, and won't want to give up easily. So it will probably be back.
"The Catch" (ABC)
"The Catch" gets weak ratings, but it's good reviews were probably enough to buy it a little more time on ABC, the lowest-rated broadcast network. This one just recently started and doesn't have a place in the fall lineup, so the network has time to decide how badly it wants to keep executive producer Shonda Rhimes happy. She's done a lot for the network.
Nashville (ABC)
This is probably the end of the road for "Nashville," though people have thought that many times before. Hayden Panettiere just returned from some personal time off, but she may get more soon.
Dr. Ken (ABC)
Its ratings are probably just barely good enough to keep it alive. It's a Friday series, and nothing does very well on Friday.
"Last Man Standing" (ABC)
It does a little better than "Dr. Ken," so we like its odds. Tim Allen may keep his ABC time slot.
"The Real O'Neals" (ABC)
Its ratings are just good enough. And it likely benefits from the same question as other ABC sitcoms: Does the network have anything better with which to replace them?
ABC has probably already milked this "Captain America" spinoff for all it's worth. The Hayley Atwell vehicle hasn't made enough of a mark.
"Galavant" (ABC)
This was a favorite of former ABC entertainment chief Paul Lee, who is no longer around to revive it yet again. It's gone.
"The Family" (ABC)
This look at a child's apparent return from the dead probably hasn't made enough of an impact to save it from its own death. While the ratings aren't impressive, the slow-burner has gained some momentum lately.
"Criminal Minds" (CBS)
It easily has strong enough ratings to come back. CBS knows procedurals, and it knows this one works.
"Criminal Minds: Beyond Borders" (CBS)
The "Criminal Minds" spinoff "Beyond Borders" doesn't do nearly the same numbers "Criminal Minds" does, but it recently hit its best post-debut numbers. That will help its renewal chances -- plus, crossovers!
"The Odd Couple" (CBS)
Its ratings are definitely unimpressive for a CBS comedy, but the spring series doesn't really need a decision right this minute. For now, we'll err on the side of the show slowly dropping until cancellation eventually becomes a mercy killing. Or maybe we'll let Matthew Perry and Thomas Lennon throw egg on our face next year.
"Life in Pieces" (CBS)
It's ratings are strong enough to make it likely to return. CBS seems to like the Colin Hanks-starrer paired with big hit "The Big Bang Theory."
"Limitless" (CBS)
The ratings are decent, and would CBS really cut off its Bradley Cooper connection? We think this one is safe. See the next slide for some more evidence.
"Supergirl" (CBS)
"Supergirl" isn't a sure thing. But many critics support it, and its overall ratings would be solid by most networks' standards. (CBS likes hits, and isn't shy about it.) Super synergy should help. "Supergirl" has already crossed over with CW's "The Flash." And though it exists in a separate universe from the films, it could get a bump from DC movie releases including "Batman v Superman" and "Suicide Squad." We're guessing CBS gives it another shot, and network President Les Moonves already suggested it will be among freshman series renewals.
"CSI: Cyber" (CBS)
Neither ratings nor reviews are very good for the latest "CSI" spinoff. Unplug.
"Rush Hour" (CBS)
"Rush Hour" should have stayed on the big screen. This adaptation gets terrible ratings, so we don't even expect it'll finish its initial run.
"The Grinder" (Fox)
The ratings are not good. But Fox's top executives seem to like the Rob Lowe/Fred Savage sitcom, so that's something. A coin flip, probably.
"Sleepy Hollow" (Fox)
There was a lot of hate for the Season 3 finale, in which someone we liked apparently died. The show will likely die with this character. (We're avoiding gender pronouns in case you haven't seen it.)
"Grandfathered" (Fox)
You can blame corporate America if the show doesn't return. ABC Studios owns the show, not 20th Century Fox, and Fox likes to keep things in the (corporate) family these days. Speaking of family, John Stamos might be willing to go quietly back to his -- or at least the one he has on Netflix. More "Fuller House" is coming.
"Bordertown" (Fox)
The ratings are nowhere near where they need to be. And let's be honest, do you know any adult who's seen this show? Courting the teens is great, but they don't have the money that advertisers want to see.
"Second Chance" (Fox)
The ratings aren't good enough for "Second Chance" to get one. (Sorry, that was hacky and we apologize.) It also doesn't help awareness with the number of name changes this flop has gone through.
"The Carmichael Show" (NBC)
Jerrod Carmichael's show gets passable ratings, and, more importantly, gets people talking -- like it did with its exploration of the Bill Cosby allegations earlier this year. This one's coming back.
"Undateable" (NBC)
Live or pre-taped, the Chris D'Elia comedy just isn't working out, ratings-wise. Since NBC seems to have little interest in comedy lately, this looks like a break-up.
"Crowded" (NBC)
Carrie Preston will always have a place in our hearts for her wonderful work on "The Good Wife," but "Crowded" just isn't pulling ratings -- even behind "Little Big Shots" on Sundays. Too early to say for sure, but it doesn't feel like it needs to -- or will -- come back in 2017.
"Mysteries of Laura" (NBC)
The Debra Messing series will probably be saved based on its overall viewership. Those who age out of the 18-49 demographic may not be an advertiser's first choice, but they have money -- just ask CBS.
"Heartbeat" (NBC)
The show underwent a name change and seasonal change before it even premiered, and has had little pulse, ratings-wise. We're calling it.
"Telenovela" (NBC)
Eva Longoria's "Telenovela" has a chance to come back, but not a great one. Its lead-in, "Superstore," was rewarded with a second season a while back, but there's a big ratings gap between the two.
"You, Me and the Apocalypse" (NBC)
Great cast, terrible ratings, the end is nigh.
Wow, you're a diehard for cancellations news to have made it this far! Thank you. For a deeper dive into the fate of broadcast's bubble shows, click here.
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Will your favorite show survive to next season? We’ll give it to you straight
Will your favorite show be canceled or renewed for next season? TheWrap looked at several factors to see if several low-rated shows -- from "American Crime" to "Sleepy Hollow" to "Criminal Minds" to "Undateable" to "Nashville" -- will be back this fall.
