Upfronts 2014: LaTorre Sees ‘Very Healthy’ Growth
Fox Cable Networks ad-sales president Lou LaTorre issued a rosy forecast for cable network ad sales in the coming broadcast year, with billings increasing about 5% in the upfront auctions and 5%-6% overall when scatter market sales are added in after the upfronts.
“Cable will be very healthy in this coming year,” LaTorre told reporters at an upfront briefing today at 21st Century Fox’s offices in New York City.
He projected the 5% gain in upfront ad-sales commitments as worth about $500 million to cable networks. Over the full year, he said, the gains should be about $1 billion.
He also said he did not think broadcasting and syndicated programming ad sales would see any increases, because of their “continued loss of audience.”
Those revenue forecasts are in line with projections this week from RBC Capital Markets analyst David Bank, who predicted no gain for broadcasters in terms of ad sales for the 2014-15 broadcast year compared with a 2013-14 total of about $13 billion.
Bank forecasts a 4% overall gain for cable network ad sales in 2014-15, rising to about $26.9 billion from about $25.9 billion.
As for ad pricing, LaTorre said he thought top cable networks (including FX) would see full-year of 7%-8% on a cost per thousand (CPM) impression basis. Smaller cable networks should see gains in the 3%-5% range, he said.
Bank’s upfront pricing prediction was a 7.1% gain for cable networks. He predicted 55.6% of all ad sales revenue would be booked in the upfront in the 2014-15 year for cable networks.
LaTorre also predicted more cable programmer deals -- especially for original shows that are heavily DVRed -- using C7, or viewership over seven days, instead of the C3 standard that measures commercial ratings over three days after a show's premiere. Cable originals gain about 6-8% in viewership over the extra time span, LaTorre said, and agencies can tell their clients they are adding great content at perhaps a "slight rollback" on a CPM basis for the later views. He said some broadcast-network deals were done last year using C7 and he thinks "several" cable networks will cut C7 deals this year.
Also at the upfront briefings, John Landgraf, CEO of both FX Networks and FX Productions, talked about the plan to pack FX and FXX with original programs while holding off adding originals to movie service FXM; the variables involved in doing subscription VOD deals with the likes of Amazon, Hulu and Netflix and the reasoning behind building a stockpile of comedies using so-called 10/90 orders.
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Kent has been a journalist, writer and editor at Multichannel News since 1994 and with Broadcasting+Cable since 2010. He is a good point of contact for anything editorial at the publications and for Nexttv.com. Before joining Multichannel News he had been a newspaper reporter with publications including The Washington Times, The Poughkeepsie (N.Y.) Journal and North County News.