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Early Upfront Prices At Double-Digit Levels

In a relatively slow moving upfront market, buyers say they’re hearing from the networks that some business is being written at prices favorable to the sellers.

CBS has done some early deals, with prices in the low-double digit range, a market source said. It was not clear if CBS has completed a significant portion of its upfront sales or just a handful.

Prior to the upfront, CBS CEO Les Moonves signaled that he expected the price increase to be in double-digit territory.

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CBS had no comment.

On Tuesday, NBCU CEO Steve Burke told an investor conference that NBCU had already quietly completed a majority of its business.

"We are having a very strong upfront. And because if you combine broadcast with all our cable channels, we're the biggest provider of television advertising in the country, so we went first in the upfront last year. We're going first again this year. We're a little over halfway done."

Market sources said NBCU's deals were being done with price increases in the low-teens. An NBC spokesperson had no comment.

This upfront market is expected to be significantly stronger than last year, but buyers were trying to resist paying more than double-digit price increases.

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“The math says one thing, but buyer sentiment is quite different,” said one buyer, who thinks the networks are talking about deals done to try to rattle and stampede buyers.

The upfront market’s strength is the result of a hot scatter market that pushed up prices 20% to 30% above what clients would have paid had they bought in last year’s upfront.

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There is also a sentiment that some ad dollars that have been poured into online advertising might be coming back to TV, whose effectiveness as a sales tool is more tried and true.

Last week Viacom CBS Philippe Dauman said his company was more than half way done with its upfront deals.

He said the company’s cable networks including MTV, Comedy Central and Nickelodeon, were getting price increase in the high single digit range and seeing volume up in the mid- to high-single digit range.

Jon has been business editor of Broadcasting+Cable since 2010. He focuses on revenue-generating activities, including advertising and distribution, as well as executive intrigue and merger and acquisition activity. Just about any story is fair game, if a dollar sign can make its way into the article. Before B+C, Jon covered the industry for TVWeek, Cable World, Electronic Media, Advertising Age and The New York Post. A native New Yorker, Jon is hiding in plain sight in the suburbs of Chicago.