Stocks plummeted and covid cases surged.
Who’s ready to buy some ads?
For the first time in three years, upfronts, the showcases the media industry offers advertisers to persuade them to pay for commercial time, were held in person in Manhattan. In recent days, thousands of ad buyers have packed venerable New York institutions like Madison Square Garden, Carnegie Hall and Radio City Music Hall. On the line? Tens of billions in ad revenue.
These were some of the key points of the week:
Broadcasting commercials takes center stage.
In 2019, advertisers spent as little as 10 percent of their budgets on streaming. This year, that budget is approaching 50 percent, several media buyers said in interviews.
Presentations reflected the change. With the exception of a brief two-minute video focused on CBS’s hour-by-hour fall schedule, media executives barely mentioned their network’s primetime lineups. At Disney’s upfront, the vast majority of trailers and teasers were devoted to movies and series for Hulu and Disney+, the flagship streaming service, which is set to feature ads later this year.
“This is my first trailer,” said Kevin Feige, president of Marvel Studios, from the stage at Disney before unveiling a trailer for “She-Hulk: Attorney at Law,” a new comedy set to premiere on Disney+ this summer.
This was a consistent theme throughout the week, with previews of upcoming shows and movies on Peacock, Paramount+, HBO Max, and Discovery+ all earning significant airtime. Free ad-supported streaming services Tubi (owned by Fox) and Pluto (owned by Paramount) were also prominently discussed.
“Traditionally, upfront payments go to TV networks,” said Allan Thygesen, who manages more than $100 billion for Google’s advertising business in North and South America. “But today, because of the incredible changes we’ve seen in the media industry, this is not the candor of your parents.”
An inside look at Fox News
The conservative cable news network is one of the most influential media outlets in the United States.
Netflix takes it on the chin.
Netflix aims to run commercials by the end of the year at a time of falling subscribers. Rival executives used that as an opportunity this week to say why their own business was the best destination for ads.
“We’ve been committed to the ad-supported video business from literally the earliest days of our company’s history,” said Jeff Shell, chief executive officer of NBCUniversal, of Radio City Music Hall. “This is not an extension of our core business, nor is it a pivot. It is our core business.”
Linda Yaccarino, president of global advertising for NBCUniversal, made a similar note, saying that to some of her rivals, “advertising might seem like an afterthought, or worse, a new idea for a revenue stream. But not here.”
At Fox Upfront, Eric Shanks, CEO of Fox Sports, appealed to ad buyers, saying, “We know that without you we would just be Netflix. We love to sell pizzas, trucks, phones and insurance.”
And Jimmy Kimmel, the king of the early roast, took repeated jabs at the struggling tech giant.
“Remember when Netflix openly encouraged us to share passwords, and we said, ‘How do these people make money?'” he told Disney in advance. “Turns out not.”
“Oh, everyone loves ‘Bridgerton?’” he continued. “How much do you think they’ll love it when it’s interrupted by your Zyrtec commercial every four minutes? We already have Netflix with commercials, it’s called Hulu.”
Fox News and CNN enter the picture.
One-view advertisers aren’t used to seeing during the opening week: Fox News.
For years, the Murdochs’ news channel did not appear on Fox’s initial presentation, a relief to the company’s entertainment executives, who were wary of alienating leftist talent from Hollywood. But three years after Rupert Murdoch sold his film and television studios to Disney, Fox News was featured as prominently as its sports division and its slimmed-down entertainment division for the first time at Fox’s presentation on Monday.
“We are all part of one Fox,” said Suzanne Scott, executive director of Fox News, underscoring the point in a pre-recorded video.
Although Ms. Scott never mentioned the network’s top-rated host, Tucker Carlson, who faced revolt from advertisers in the past for his monologues about race, he did appear in a promo reel.
Later in the week, CNN’s new front man Chris Licht took the main stage for the newly formed Warner Bros. Discovery. Mr. Licht emphasized that his cable news network would strengthen his commitment to information, suggesting that the network move away from mainstream opinion programming.
“At a time when extremes dominate cable news,” he told advertisers, “we will look to go a different way, reflecting the real lives of our viewers and elevating the way America and the world view this medium.” .
Back in person, as if nothing and everything had changed.
After two years of virtual showings streamed from ad buyers’ laptops, the networks were mostly focused on shock and awe, emphasis on shock.
Ad buyers were greeted with blinding lights, seat-moving sounds, and elaborate musical numbers. Movie stars like Sylvester Stallone and Dwayne Johnson, aka The Rock, made appearances, as did a couple of Kardashians and the Manning brothers. Singer Lizzo exhorted ad buyers at the opening of YouTube in advance to sing along to her lyrics “feel good as hell,” a demand she made again, the next day, at the Warner Bros. Discovery showcase.
On Monday, just as a few thousand maskless ad buyers filled Radio City Music Hall for the NBCUniversal event, an alert went off on attendees’ phones: Covid cases in New York were on the rise and it was recommended strongly recommend the use of masks indoors.
“It’s great to be in Radio City – what a historic room to be able to tell people you have Covid,” Seth Meyers said later during the presentation.
Covid concerns aside (Mr. Kimmel tested positive shortly before the Disney performance and had to perform via satellite), the show went on. Jennifer Hudson sang Aretha Franklin’s “Respect” on Warner Bros. Discovery. Even YouTube, which first debuted at Upfront week, came roaring, with pyrotechnics, sequins and jazz hands at a Broadway theater steps from Times Square.
But behind the dazzling glare there was a fundamental change. Viewing habits are changing, interest in the fall lineups has faded, and there was that ever-present existential concern: What have the upfronts become? Are they still worth it?
“We can’t get to the advances, shake some hands, make some phone calls and make our media investments for the year,” said Shenan Reed, L’Oreal’s head of media, while presenting on stage for Youtube. “The days of Mad Men’s three-martini lunches are finally, sadly, long behind us.”