Pan Am, with Christina Ricci, Kelli Garner, Karine Vanasse and Margot Robbie,… (Patrick Harbron, ABC )
Just when the ABC television network was feeling desperate, Kirstie Alley and the juggernaut hit "Dancing With the Stars" stepped in with some fancy footwork.
Now it's up to Paul Lee, the network's new entertainment president, to demonstrate his moves.
Lee is to unveil his first prime-time schedule before hundreds of advertisers in New York on Tuesday to kick off the TV industry's annual springtime sales bazaar. This is an important week for ABC and competitors CBS, NBC and Fox. The networks take turns presenting their upcoming fall lineups with the hopes of grabbing a bigger slice of the $9-billion-plus prime-time "upfront" advertising pie.
A former BBC and ABC Family cable executive, Lee was unexpectedly thrust into the top programming job at Walt Disney Co.'s broadcast network in late July after the abrupt departure of his mercurial predecessor Stephen McPherson. The management shuffle at ABC came as Disney executives were grousing about the network's performance, and rumors percolated that Disney was considering selling its broadcast network or television stations.
For Lee, the stakes are high.
During the last five years, ABC has lost more than 1.5 million prime-time viewers, including a flight of younger viewers prized by advertisers. This year the network slipped into fourth place in the ratings as its aging prime-time dramas, including "Desperate Housewives," "Grey's Anatomy" and "Brothers and Sisters," faced dwindling audiences.
But the mood in Burbank has brightened as ABC staged a dramatic comeback with the return of "Dancing With the Stars" in late March. The dancing competition is delivering its most-watched season, lifted in part by the performance of Alley, the 60-year-old former "Cheers" star.
Network executives also have been heartened by signals that advertisers are prepared to shell out big bucks for network time.
Strong demand in recent months for network spots has prompted analysts to predict double-digit ad rate increases for the TV season that begins in late September. After this week's presentations in New York, network sales executives will begin negotiating ad prices and packages with buyers. Those sales form the "upfront" market — the period in late May and June when the networks unload the bulk of their commercial inventory for the upcoming season.
"Three years ago, during the recession, advertising spending took a precipitous drop," said Kris Magel, director of national broadcast for the ad-buying firm Initiative. "Since then, ad rates have been climbing 2% to 3%. And for national TV and digital ads, the rate increase has been much higher — 6% to 7%. National television has emerged as a leading advertising sector." Digital ads include those on the Internet and mobile devices.
TV advertising represented more than half of the $131 billion spent in the U.S. on overall advertising last year, a 6.5% increase from 2009, according to Kantar Media, which monitors ad spending.
The turbocharged ad market has improved ABC's outlook on the broadcast business.
"All signs are that [the] upfront will be a strong one," Disney Chief Executive Robert Iger told analysts last week during a conference call to discuss the company's earnings. Disney's broadcast revenue in its second quarter (which ended April 2) was up 4% to $1.5 billion — despite generally lower ratings at ABC.
Five years ago, ABC averaged nearly 10 million viewers in prime time. This season, an average of 8.4 million people have tuned in each night. The network's audience is down 2% compared with last season. More alarming, ABC is off 11% among viewers ages 18 to 49. The median age of ABC's audience now tops 51 years, the second-oldest in broadcast TV (behind CBS', at 55).
"A lot of their dramas are suffering double-digit audience declines," said Jason Maltby, a top buyer with the Mindshare ad agency. Citing such examples as "Grey's Anatomy," "Private Practice" and "Brothers and Sisters," he added, "These shows have been the stalwarts of the ABC schedule for many years, shows they have built their brand on. But they are getting a little long in the tooth."
Former ABC programming chief McPherson — who left under a cloud last summer after a scandal involving emails that were deemed inappropriate — struggled for years to find a break-out hit on the magnitude of "Lost." He scored with "Modern Family," whose audience continues to grow. But that comedy is produced by 20th Century Fox Television, which means Fox — not ABC — reaps the profits when the series' reruns play in syndication.
It is a priority, Iger said, for in-house ABC Studios to come up with shows that stick.
"Clearly our successes in these last few years were not as great as the successes that we saw some five, six years ago," Iger said. "This crop of pilots represents the work of a new management team, and we're hopeful these new shows will firmly anchor our prime-time schedule in the years ahead."