ABC Abandons CPM, Charges Flat Rates For Broadband Spots

THE SHIFT FROM BROADCAST TO broadband is having broad implication in the way TV networks sell ad time to advertisers. A top TV executive at Walt Disney Co. disclosed that the company is charging advertisers a flat rate--rather than using the TV industry's standard of CPMs--as the basis of ad deals for the spots running in the seven shows it will stream this fall on ABC.com. Speaking at an investors' conference, Anne Sweeney, president of the Disney-ABC Television Group, added that advertisers had the option of just buying into the online streams. Going forward, however, ABC will look to package those opportunities with spots on the network and other properties.

The ABC.com streams were not sold in the upfront, a deliberate move to try and extract premium pricing, Sweeney said.    

She also confirmed reports about ABC's performance in the upfront: CPM jumps of 3 percent to 4 percent and a total prime-time take of $2.3 billion.

In a sign of just how crucial prime time is to a network's success, she said ABC pulled in $3 billion for all dayparts in the upfront--meaning prime time accounted for 77 percent.

Still, Sweeney said the upfront was the tip of the iceberg. The network is "focused on a 52-week selling cycle" and encouraged by scatter pricing for the fall. Last season, scatter pricing showed double-digit increases over upfront pricing.