How do you get to Carnegie Hall? Practice, practice, practice.
Times have certainly changed but for years CBS, now part of Paramount Global, took to the grand stage at Carnegie Hall each May to show media buyers and advertisers what millions of viewers would be watching during the television season.
With practice, the network got good at it. Buyers dutifully showed up for the star-studded presentations. Bands like The Who would play. Clients enjoyed hors d'oeuvre and alcohol afterward. And, most years, the upfront market system resulted in higher and higher prices paid for commercials on broadcast television, the most powerful mass medium for selling goods and services.
For at least 20 years, agency executives like David Verklin of Carat would predict the excesses of the upfront presentation — and the late-night, cold-pizza fueled negotiations that followed — were no longer necessary and would vanish. The upfronts hung on. Sellers had leverage and sold most of TV's $70 billion worth advertising between Memorial Day and the start of the new season in the Fall.
Now, Paramount’s decision to abandon its Carnegie Hall presentation is the latest sign that broadcast is losing primacy in the television world. Like other media companies, Paramount is focusing on its streaming services — Paramount Plus and Pluto TV — both of which are at least partly ad-supported.
Paramount will be holding smaller, more intimate get-togethers for media buyers and clients leading up to the upfront market. The powers-that-be have finally decided that that million-dollar upfront extravaganzas have become costly dinosaurs in a new digital age of streaming. Linear ad sales are expected to decline, Carnegie Hall or no Carnegie Hall. CBS may generate less ad revenue this way but, in the grand scheme of things, broadcast matters less than it used to, so the party’s over.
Back in the Beginning
ABC was first to hold an upfront in 1962, with the timing of the new season tied to the release of new model-year automobiles. Up until the pandemic, it had presentations at Lincoln Center. NBC’s venue of choice has been Radio City Music Hall. NBCU has announced it will be back at the famous theatre in May 2023. Recent upfront presentations have pitched whole portfolios — including streaming and cable services, as well as broadcast.
The impressive venues rented for broadcast’s upfront week were designed to underscore the Hollywood magic only the major broadcasters could reliably bring to the small screen.
But broadcast’s hold on audiences wasn't permanent, nor was its place as the home of the best programming. As audiences were drawn to the choice offered by cable, cable ad reps urged advertisers to put a fraction of their clients’ budgets into cable — the 10% solution. Then cable networks like USA, TNT, FX and AMC began to assault the networks with Monk, The Closer, The Shield and Mad Men, premium shows worthy of premium ad prices.
Eventually, ESPN, Turner and Discovery elbowed their way into upfront week. But, much to the chagrin of cable execs like David Zaslav, who is now CEO of Warner Bros. Discovery, cable ad prices (with some exceptions) never quite reached parity with broadcast network commercials on a cost-per-thousand CPM basis.
Then came the NewFronts for digital content, and Hulu and YouTube were in the mix. As more and more viewers turned to streaming and more streaming services sold advertising, the market shifted further from the broadcasters.
In a peculiar brand of economic jujitsu, the broadcast networks have been able to raise prices based on the scarcity of ratings points they managed to generate. Supply and demand, as they say.
At this point, Paramount Global — owner of CBS, the most traditional of the broadcast networks — is saying it’s time to do something new, or at least different. Something maybe less expensive. Will the other big media companies, all cash-strapped as their streaming businesses burn money, follow?
Back in the day, extravagant parties were important because they attracted the legendary cadre of 25-year-old media planners, who some believed really made the decisions about which shows and networks would get bought by big agencies before more senior executives started negotiating. (Some senior agency execs preferred spending upfront week in Park City, Utah.)
Now, more and more decisions are being made based on data, predictive algorithms and programmatic technology. It’s hard to buy one of those programs a drink, let alone impress them by letting them take pictures with the cast of a sitcom few will watch.
Maybe it’s nostalgia talking, but TV used to work. There were shows everyone watched. They were easy to find. They were free. You just had to sit through a few commercials — and some of those you could sing along to.
TV worked for advertisers too, until those digital charlatans started pointing to data, dubious though it was, that clicks, site visits and other nonsense translated to sales and bean counters started moving ad dollars online. Hard evidence that TV commercials work, and are worth even more advertisers than have been paying for them, seems to have come too late.
Perhaps Paramount is wrong and, like NBC decades ago, will stop trying to reinvent the wheel and come crawling back in the future.
Until then, goodbye Carnegie Hall. Farewell Ben Benson’s. Fox’s legendary Jon Nesvig was no Willy Loman. Selling TV seemed to be the best, easiest job in the world, leaving plenty of time for golf. As you get into the ad business, Netflix, you don’t know what you’re missing. ■
