Cable upfront solid despite ratings challenges


According to a recent Thomas Weisel & Partners report, the cable upfront is looking to be a strong one this year, as strong scatter market and upfront CPM increases should offset ratings weakness: "While Viacom is still in the midst of its upfront, with only a few deals reported in the press, we believe the company's networks are likely to perform in line with our estimates despite disappointing ratings. We believe the kid's TV upfront is solid as well.

We estimate MTV Networks could see double-digit CPM gains which should offset ratings declines and a move to commercial ratings, where retention levels are lower than average at MTV Networks. We remain comfortable that Viacom's cable networks can post 5-6% advertising sales growth (including international and digital sales) in 2H07 and 2008 despite recent ratings challenges. We note that if ratings were to improve in response to new and planned programming initiatives our estimates could prove conservative."