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Cynopsis: Weekender 02/22/07 Good afternoon. It's Thursday, February 22, 2007, and this is your Cynopsis: Weekender edition. Below are a handful of industry stories - with which you may agree or disagree. If you'd like to be heard - put together your own 350 word submission! Details below. The Media Scorekeepers By Louis Chunovic Are the media worthy? The bottom-line, company-by-company answer is in the hands of Standard & Poor's senior media credit analysts, who came out from behind their e-ledgers and algorithms for a rare trends-and-challenges panel at the McGraw-Hill Media Summit, held recently in Manhattan. The media’s AAA-rated players, according to S&P, include Disney, Scripps, Omnicom, the Washington Post Co. and Gannett. Media BBBs [see below] include Hearst-Argyle, Time Warner, News Corp, CBS, Viacom, IAC/Interactive, Belo and the New York Times Co. But the trend is not good, according to Heather Goodchild, Managing Director/Leisure & Media, S&P. Across "pure media only," S&P in 2006 had "only three upgrades out of 42 ratings actions. That’s a worsening of the trend from 2005, which had 13 upgrades out of a total of 38 rating actions." One of the big reasons for that is the impact of the Internet on advertising streams, she said. Media, entertainment and telecommunications companies continue to face a "fast-moving landscape," with factors like audience fragmentation, channel substitution and pressures from equity investors all potentially affecting credit ratings, according to Craig Parmelee, also a managing director. As the newly consolidated phone behemoths ramp up to deliver broadband and video, S&P's credit assessments will consider "how many homes are addressable," said Richard Siderman, managing director, Telecom & Cable, S&P. In the epic telco-cable battle just now beginning, picking winners is still two or three years away, and although cable companies have "first mover advantage," cable has "dropped the ball" before, most notably in its earlier war with satellite providers, he added. The basic issues that will be decisive are technology, availability, customer service and marketing, according to Siderman. Knowing whether "old-fashioned" DVDs will be "cannibalized" by video-downloading is still five years away, said Goodchild. Off-network dramas that also are being sold by iTunes "aren't going so well in cable syndication," she added, which "should give us pause." And when it comes to broadcast television station groups whose stations tout "hyper-local" content and advertising, that's still a "work in progress." One bright spot is that stations have finally "broken the log jam on cash payments for retransmission"; another promising development is broadcasting to mobile devices, she added. Bountiful presidential election year advertising spending, on which the TV industry is counting, remains a "wild card," according to Goodchild, because of the possibility that the presidential primary process could "flame out early," resulting in a narrow primary field followed by a general-election landslide. And that would mean the expected torrent of political advertising dollars could slow to a relative trickle. S&P's influential credit ratings, which are frequently adjusted to reflect changing circumstances, range from AAA ("obligor's capacity to meet its financial commitment on the obligation is extremely strong") through BBB ("adequate protection parameters") to BB, B, CCC, CC, and C (all "regarded as having significant speculative characteristics") and on to the dread D ("in payment default"). S&P is owned by McGraw-Hill. Advertisers Cozy up to NASCAR, Despite Cheating Scandal By Daisy Whitney With a dark cloud hanging over NASCAR, the season kicked off earlier this week when Kevin Harvick won the Daytona 500, the SuperBowl of racing that starts the season. Yet, all is not well at the race track. The sport is dealing with a cheating scandal. NASCAR has been cracking down on cheating and punishing teams for doctoring cars. The microscope NASCAR is under comes after TV ratings dropped last year for the first time in 15 years. But none of that seems to be impacting ad revenue. Nielsen Monitor Plus recently reported that the Daytona 500 has generated a five-year rise in total ad revenue. In the past five years, TV ad revenue has grown 17 percent on average for the Daytona 500, said Nielsen Monitor-Plus, a tracking arm for Nielsen. Also, the cost of a 30-second spot in the Daytona 500 has increased 11 percent each year on average. Finally, at least 10 new advertisers were slated to introduce new campaigns during the race, including technology companies, movie studios and financial services firms. "The rising interest in the Daytona 500 and NASCAR events among the general public has led to a growing demand among advertisers to buy spots for these broadcast events, and hence the increase in the cost of the average 30-second spot over the past five years," said Brian Lane's, SVP/Client Strategy and Product Development Management for Nielsen Monitor-Plus. And more types of advertisers are coming on board. Retail and telecom are relatively new sectors for the Daytona 500. But a rising tide doesn't lift all boats. The rapid increase in advertising prices and the growth in advertisers is particular to NASCAR. It is not emblematic of a trend across other sports, Lane said. "Mature sports like football, basketball and baseball have an established and diverse roster of advertisers. NASCAR is still growing and developing its fan base so it's natural to see these transitions in advertisers," he said. So cheating or not, advertisers are signing up. As the saying goes, there's no such thing as bad publicity. New Issues, New Boss at NBC Universal By E. Maya On Tuesday, February 6th, GE Chairman and CEO, Jeffrey Immelt, announced that Jeff Zucker would succeed Bob Wright as President and CEO of NBC Universal. The move comes as Immelt looks to shake up its entertainment division and deal with the emerging new digital media age. Since taking on his new role, Zucker has met with News Corp's Peter Chernin and Viacom's Phillipe Dauman to discuss starting a user video site to compete with YouTube. He has also taken an aggressive stance on filtering copyrighted audio and video clips against the powerhouse internet video site. "YouTube needs to prove that it will implement its filtering technology across its online platform. It has proven it can do it when it wants to," said Zucker. These warnings have sent over a dozen tech companies into a flurry to create filtering tools. While Zucker may not be able to stop piracy, he can urge YouTube to create a legitimate business model. If Zucker can find a way to monetize new media, then it could be his biggest legacy as President and CEO of NBC Universal. In fact, Zucker can look at his predecessor's success in dealing with the booming cable business in the late '80s and '90s as an example. Bob Wright recognized early on the value of cable channels when most broadcasters wrote them off. Today, among NBC Universal's most profitable assets are cable outlets USA Network and Bravo. Just as Wright steered NBC into the cable frontier at age 42, Immelt hopes that a younger executive will take charge of the emerging digital world. "In the past few years, Jeff has shown that he is an energetic, focused leader who can rise to a challenge," Immelt said. "His creative experience, expertise in news and broadcasting and intense passion for the business were immensely appealing to the Board and to me during this succession process." Although dealing with the new media age is crucial, it is hardly Zucker's only task. As the new President and CEO, he must ensure momentum among all of its television entities, including cable and news, and learn the theme-park and film businesses. He must do all of the above while continuing with a cost-cutting plan already under way. Indeed a high learning curve, but Zucker, a 21-year veteran of NBC Universal, seems up to the challenge. * WEEK'S RECAP *
SUBMISSIONS / AD SALES/ SUBSCRIBE & UNSUBSCRIBE Cynopsis Ad Sales - Mark Bohn - 203-583-1224 / Article submissions for Cynopsis: Weekender are welcome, provided they are no longer than a maximum of 350 words. News articles used are paid at the rate of $1/word. Not all submissions are used. Editorials (also 350 word max) may be submitted but are not paid, and not all are used. Send submissions to Cynopsis at . The Weekender edition is published every Thursday and includes a few items to ponder over the weekend, as well as the highlights from the week. It is delivered to the entire Cynopsis subscriber list, unless you specifically request to be unsubscribed. To subscribe, unsubscribe or change your email subscription, go to the Cynopsis website, www.cynopsis.com and click on the subscribe tab. Emails to the Editor: subject E-Mails to the Editor Copyright Cynthia Turner 2006 Later -- Cyn 02/22/07 What's On This Weekend: Saturday: 8-11p, February 24, 2007 ABC: Movie: Forrest Gump CBS: Jericho, CSI [r], 48 Hours Mystery FOX: Cops, Cops [r], America's Most Wanted ION: Movie: Chisum [7], Movie: After Hours MNT: Movie: Diary of a Hitman NBC: Dateline, Law & Order: SVU [r], Law & Order: CI [r] PBS: Local Programming, Austin City Limits, Local Programming TELE: Vas o No Vas [7], Seguro Y Urgente, Cinemundo del Sabado UNIV: Sabado Gigante Sunday: 7-11p, February 25, 2007 ABC: Barbara Walter's Oscar Special, The 79th Annual Academy Awards CBS: 60 Minutes, Amazing Race 11, Cold Case, Without a Trace [r] CW: Reba, Reba, 7th Heaven, Beauty and the Geek [r] FOX: King of the Hill, King of the Hill, The Simpsons, The Simpsons, Family Guy, Family Guy ION: Kung Fu, Movie: Thief, LAPD: Life on the Beat NBC: Dateline, Grease: You're the One That I Want, Crossing Jordan [r], Crossing Jordan PBS: Nature, Masterpiece Theatre TELE: Cine En Familia, Cine Millonario/Estreno UNIV: La Hora Pico , Bailando por la Boda de mis Sueos |
