MediaWeek: The Networks' Rome is Burning

Picketing is long and tedious work. It's not something that any of us want to be doing, and after a few weeks of it, it's natural to ask, "Is this doing any good?"

Yes, it is.

Everyone's already heard that the AMPTP is returning to the table to negotiate with us, and a big part of the reason for that is the labor stoppage. Today, MediaWeek is telling a new side of the story. The strike is about to hit the TV networks in the wallet:

Media buyers, in light of the Writers Guild of America strike, say they might be a month away from asking the broadcast networks to renegotiate their upfront packages or give them cash back.

The networks have a clock on them, and the experts don't think reality programs will be able to bail out their schedules:

Sternberg projects that if the strike continues through the end February, the broadcast networks will lose an additional 5 percent of its prime-time ratings, on top of the minus 12 percent it is currently averaging. That number will grow to 8 percent in March (down 20 percent compared to last season), by 12 percent in April (-24 percent) and by 13 percent in May (-25 percent).

That level of audience defection from broadcast prime time will surely leave the networks with virtually no way to meet their promised upfront guarantees and would likely prompt a large number of advertisers to ask for cash back. It would also create chaos for the 2008-09 upfront in May.

In a separate article, media buyers and experts speculate that even those reality shows that manage to do huge numbers during the strike (like Fox's much-touted American Idol) won't be able to keep advertisers entirely happy, especially those looking to court the upscale demographics:

�Obviously, this is not what we thought we bought,� she said, referring to the current marketplace, versus broadcasters� assurances during last spring�s upfronts. �All our investments are mindful of the clients we buy for in terms of what�s the best strategic fit for that client, and any disruption to that strategy is just not a good thing.�

This is good news for our negotiating position. On the eve of tomorrow's rally, everyone should feel confident that our contributions are having a measurable impact, and that a fair deal is within reach.