How the coronavirus could disrupt TV upfronts

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TV Upfronts Volume

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The TV upfronts, when networks commit billions of dollars in TV ad spending, could be delayed until sometime later this year due to the coronavirus pandemic’s impact on network programming, per network and agency sources to Ad Age.

TV networks initially opted to make the 2020 upfronts virtual, but now the pandemic has disrupted programming to an extent that could threaten the effectiveness of network pitches:

TV production slowdown. TV production has slowed or even stopped in recent weeks, as some production aspects can’t be done remotely, and that slowdown is expected to continue to hurt the flow of new projects. That could include pilots for new shows that make up a key part of network programming pitches.
Loss of sports programming. Networks may struggle to pitch games to advertisers who have seen the vast majority of live sports programming evaporate in a matter of weeks. Over the past few weeks, nearly every major sports league — with the exception of the NFL — has put its season on hold, and the Tokyo Summer Olympics were moved to 2021. Further, there’s no clear indication of when these sports will resume, creating more uncertainty around what inventory will be available and when.

These programming disruptions — coupled with broad economic uncertainty — could also dampen the willingness of ad buyers to make advance decisions on TV ad spend. Given the uncertainty brought on by the pandemic, advertisers may not feel like they have enough information about how the broader economy will shake out to make smart commitments through the first half of 2021, as the upfronts require.

Broadly, advertisers and brands are already taking supply chain impacts into account when deciding how to reallocate dollars in 2020. But uncertainty about the medium- to long-term economic impact of coronavirus could mean that some advertisers choose to pause, withhold, or reallocate TV spending in the near term. In fact, near-term TV advertising demand for some TV network inventory is reportedly dropping in March and April as media buyers suspend buying due to coronavirus-related uncertainty, per media execs to MediaPost.

And questions about live linear programming could also encourage TV ad buyers to shift some dollars over to ad-supported streaming during this time: Increased OTT viewing has resulted in a 16% increase in OTT video ad inventory, per SpotX.

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Source:: Business Insider

      

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