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NBCU’s Shell: Upfront ‘Much Better than Expected’

NBCU
NBCU CEO Jeff Shell (Image credit: NBCU)

This year’s unusual upfront market was stronger than expected, according to NBCUniversal CEO Jeff Shell.

Speaking on parent company Comcast’s third-quarter earnings call Thurday, Shell said things didn’t look good for the ad market in the middle of the pandemic.

“We didn’t think a couple of months ago there was even going to be an upfront this year,” he said. “And the fact that there was one and it ended up being relatively normal and much stronger than we expected was really good news for the whole business.”

Related: Networks Declare Victory in Unusual Upfront Market

Shell said that at NBCU expected that upfront pricing would be “way down,” but when negotiations finished, pricing ended up slightly on a cost-per-thousand (CPM) viewers basis. Volume--or total commitments to buy advertising--was down slightly from last year.

During the third quarter, ad revenue was down 11.5% at NBCU’s broadcast business and down 2.1% at its cable networks.

Lower ratings were having the biggest impact on sales and Shell said that the industry-wide shutdown of production because of COVID-19 was a factor in having fewer viewers. 

“We would normally have our fall schedule in high gear right now, and we’re just starting those shows and we don’t have a lot of new content,” he said.

Shell noted that the lower ratings translated into scarcity and that with its broad portfolio NBCU could take advantage of the demand in the marketplace.

The timing of the launch of NBCU’s Peacock streaming service was “kind of perfect” at a time when other new over-the-top platforms are not ad supported.

NBCU’s decision to consolidate all of its sales under advertising chairman Linda Yaccarino was also fortuitous “because it gives us the opportunity to sell and address that scarcity across multiple platforms.”