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NBC refunds advertisers as
ratings plunge
Media
Week
Wednesday December 12, 2007
Fourth-ranked broadcaster NBC has quietly begun
reimbursing advertisers an average of $500,000 each for failing
to reach guaranteed ratings levels, the first time a network has
taken such a step in years, media buyers said.
Networks usually offer make-goods -- free advertising
slots -- in the event of such shortfalls. But NBC has none to
give. In fact, no broadcast network has much ad inventory left
between now and year's end -- except for, perhaps, a handful of
units the week between Christmas and New Year's, and that doesn't
do much for advertisers chasing holiday shoppers.
CBS, ABC and Fox also are doling out make-goods, primarily for
the first quarter. They have blamed softness on a new ratings
formula, but media agencies disagree. None of the networks would
comment.
The networks' problems emerged even before the Writers Guild
of America went on strike November 5. The networks had enough
first-run shows to get them through November, and repeats and
replacement programming will not begin in earnest until January
-- when their problems will likely start to worsen.
(Article continues below)
Among the Big Four networks, NBC has the most serious ad shortfall,
as its primetime ratings are down most dramatically. Meanwhile,
none of its new series this season have caught on with viewers.
Compounding buyers' angst about NBC is the network's plan to schedule
more reality shows, including "Celebrity Apprentice"
and "American Gladiators."
"We're trying to understand NBC's recent moves," Starcom
Entertainment exec vp Laura Caraccioli-Davis said. "We are
concerned that it might be thinking about adopting a programming
strategy like some of its sister cable networks. 'American Gladiators'
and even some of the shows they have in development, like 'Knight
Rider,' are remakes being dusted off rather than coming up with
new creations.
"NBC used to be the upscale, quality network," she
added. "We have come to expect quality, iconic programming.
Maybe they are searching for the reality hit they don't have,
their own 'American Idol.' But too much reality just doesn't play
well with advertisers."
Full
article here.
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