Tuesday, May 18, 2021

ViacomCBS to Host Virtual Upfront Event on May 19, 2021

ViacomCBS and Disney have staked out familiar ground during mid-May for their upfront pitches to advertisers, but early signs indicate that 2021 will see continued rethinking of the annual ad-buying ritual, Deadline reports.

The ViacomCBS event will be held on Wednesday, May 19, 2021, in virtual form due to ongoing Covid-19 (coronavirus) restrictions on travel and public gatherings. The single-day event follows a two-day edition last year, which was held May 18 and 19. This year’s upfront will highlight the offerings of the full network portfolio, from CBS to cable networks like Nickelodeon and MTV as well as streaming platforms. CBS All Access will be rebranded next month to Paramount+.

Disney, meanwhile, is making some significant shifts even as it preserves its presence in the traditional broadcast upfront week, adding a tech showcase on February 23 and a “development event” on March 23. The company will host a virtual upfront on May 18, which has long been the date when an ABC-led event took place in New York’s Lincoln Center. But it has also added two lead-up events, creating three points of contact with advertisers and other partners, and also ending the involvement of Hulu in the NewFronts. Hulu, which was jointly run by Disney, Fox and NBCUniversal before Disney took full control of the streaming service, was among the early standard-bearers at the NewFronts since the showcase started in 2009.

The Hulu presentation will be folded into the May 18 event hosted by Disney Advertising Sales. In addition to Hulu, it will feature ABC, ABC News, Disney Channels Worldwide, Disney Digital, ESPN, ESPN+, Freeform, FX Networks and National Geographic.

The Disney Platform Technology Showcase on February 23 will aim to highlight Disney’s technology investments and approach to data, measurement, ad experiences and transactions with marketers. The March 23 event will focus purely on programming.

NBCUniversal has not identified a date as of yet for its conventional upfront. Its recently added what it plans to be an annual element in its approach, a tech-style event called “One21” that will showcase the full capabilities across Comcast, NBCU and Sky.

Fox and the CW, the other broadcast networks with a presence during the mid-May spate of presentations traditionally held in fabled New York, are still finalizing their plans. Especially coming off a turbulent 2020 and facing deep uncertainties about the  but they are increasingly looking to disrupt the traditional spring upfront timing and September-to-May programming emphasis. The pattern took shape decades ago in part due to automakers launching new car models each fall.

The TV ad business, which is collectively worth at least $60 billion a year, has been in flux due to rising streaming adoption, cord-cutting and declining ratings. Those trends have all accelerated during Covid-19, with ad dollars shifting to streaming. NBCU launched Peacock last year as an ad-focused entry into streaming, while Hulu’s ad business has added billions to the service’s subscription revenues. WarnerMedia plans to introduce an ad-supported tier of HBO Max this year.

Momentum has been building for the TV industry to formally adopt a calendar-year approach to upfront selling and TV ratings, which is a direction media sales teams have already been moving in recent years.

From WrapPro:

Upfront Week Lowdown: TV Networks Fight for Relevance as Streaming Dominance Grows

TV network chiefs prepare to sell themselves a year after streaming swallowed the bundle

For years during May’s Upfront Week, television network executives have trotted out stars to sell advertisers on why good old-fashioned linear TV is the best place to spend marketing dollars. That pitch has become harder to make as the number of linear viewers has dwindled and the companies that own those networks have reorganized to prioritize streaming.

But this year, they might not even try.          

What was once the enemy is now being welcomed as the roommate. Over the last year of pandemic-accelerated changes in the industry, there has been an explosion of streaming services, many owned by the same companies that run NBC, ABC, CBS and some of big cable networks that will take the virtual stage this week. Those companies (at least those with prized streaming services) are now the ones pushing the migration of ad dollars toward digital.

"What we're trying to do is persuade advertisers to bring more of their investments over to our streaming services," one network executive told TheWrap. "We feel like there is a lag in terms of the investment pattern."

Streaming is still dominated by the likes of Netflix and Amazon, along with the biggest newcomer in Disney+. All three of those services, plus Apple TV+ and HBO Max, do not feature advertising. But there has been a rise in ad-supported streaming, whether through free services like the Fox-owned Tubi or Pluto TV, which is owned by ViacomCBS. NBCUniversal launched Peacock, a streamer that has both free and paid ad-supported options, and ViacomCBS supersized CBS All Access into Paramount+. WarnerMedia is debuting an ad-supported version of HBO Max next month.

All told, there were 6 million fewer households subscribed to some sort of cable or satellite package by the end of 2020, representing a 7.3% loss. The percentage of U.S. homes subscribed to a cable package fell to around 60%, a level not seen since the early 1990s.

That shift from linear to streaming is happening quicker than many imagined. Disney now gets nearly as much ad revenue from Hulu as it does it from its broadcast and cable networks. In its most recent quarter, the company's direct-to-consumer business brought in $717 million in ad revenue, while its broadcasting segment (ABC plus its owned and operated local TV stations) drove $722 million and cable networks like ESPN and Freeform garnered $711 million.

"I would say the vast majority of marketers, either presently or will in the future, get to a place where they're making no meaningful distinction" between linear and digital TV content, said Brian Wieser, global president of business intelligence for GroupM, one of the biggest media buying firms. "At the end of the day, if it's premium professionally produced content, it's not any different whether it's delivered through a connected TV, or if it's delivered through a traditional linear environment."

However, Wieser noted that despite the decline of the bundle roughly 80 million homes still subscribe to cable or satellite. But the writing is definitely on the wall. "There's a consumer migration going on; viewing patterns are changing. And, yes, they have grown and that has very much accelerated," the executive said. "But the reality is that it's not yet at parity with broadcast television."

Wieser argues that parity will probably never come, in the sense that broadcast distribution will always have the widest reach. "To view content that's delivered through an internet-connected device will always require a subscription to some service, unless you're imagining a world of municipal Wi-Fi, where cities just give it away.”

A+E Networks is one of the larger media companies that isn't tied to some kind of streaming service, but Peter Olsen, the company's executive vice president of ad sales, argues that's not necessarily a bad thing. For one, it makes A+E a content arms dealer — ask Sony how profitable that business can be — with its shows carried on multiple platforms. "We have content on Peacock; we have content on Discovery+; we have content on Hulu," Olsen said. "We think, in the long term, we can win. Because we're not placing all of our bets on one platform or on one thing."

Few network executives are better primed to straddle the line between the old and new model than Nickelodeon president Brian Robbins, who founded AwesomenessTV, one of the first successful YouTube channels. Especially with Paramount+ and Pluto TV in house, he said it's more important for Nickelodeon to become a brand rather than a singular network.

"Linear cable television is still our biggest reach vehicle today - we reach more kids through linear than anyplace else. But the truth is, we also know that kids are consuming content in many different ways on many different platforms," Robbins told TheWrap. "The brand was bigger than just linear television.

Despite the subscription losses, Olsen said the pace of decline is starting to slow, giving hopes that some sort of equilibrium will soon be reached. “We actually are seeing, year-to-date, a slowing of the subscription decline," he said. "There’s been kind of a market slowing versus the last two years. So, yes, continued migration, continued disruption, but at a slower pace."

Last year's upfront season was hammered by the pandemic, which erased ad budgets and rendered sectors like movies and travel virtually nonexistent. Typically, around $8 billion to $10 billion in ad spending is committed for the five main broadcast networks during each upfront period. That final number can be lower, however, since the figure represents commitments and not spending, which can be deflated if ratings guarantees are not met.

At the same time, Nielsen is reeling from the disclosure that it may have been undercounting viewers during the COVID era, which has enraged the TV networks who have complained for years that their viewers were already being undercounted.

Discovery CEO David Zaslav blasted Nielsen earlier this week during the MoffettNathanson Media & Communications Summit. "We’re dealing with this antiquated system of measurement that advertisers love because they can rely on something that fundamentally undercounts all of us. As great as our industry is, we haven’t been able to get Nielsen to get their act together.”

The good news for 2021 is that, overall, ad revenue is going to bounce back, one top media buyer believes.

Magna Global predicts that overall ad revenue for media companies will rise 6.4% to $240 billion this year, an increase from projections at the end of 2020. Digital ad formats will take two-thirds of total advertising sales for the first time, though national TV advertising is set to increase 3.4%. Some of that will no doubt rely on NBCUniversal's broadcast of the Tokyo Olympics & assuming that they are still held.


Originally published: Thursday, February 11, 2021.

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