The news: The TV upfronts kicked off with NBCUniversal’s presentation at Radio City Music Hall on Monday, with advertisers making their way past barricades as Writers Guild of America (WGA) members loudly protested in front of the venue.
Why it matters: Billions are expected to go toward TV ads during this year's "upfront" season, when ads are sold in advance for the upcoming year. There's a shared view this year that the ad industry is coming to the annual ad sales event with a tighter budget, rather than a willingness to spend freely.
The strike: Picketers expressed their displeasure with slogans like "NBC has a heart that's cold."
The presentation: In an unexpected turn of events last week, Linda Yaccarino, previously the global ad chief of NBCUniversal and now the successor to Elon Musk at Twitter, announced her resignation. This led to last-minute alterations to NBCUniversal's upfront presentation.
The streaming shift: Throughout their presentation, NBCU consistently highlighted Peacock, acknowledging the ongoing trend of the advertising industry moving more toward digital platforms. Traditional (nondigital) US TV ad spending is expected to be $61.31 billion this year, per our forecast, and should drop to $58.83 billion by 2027. By contrast, US connected TV ad spending will grow from $25.09 billion to $40.90 billion during that '23-'27 forecast period.
Our take: It’s impossible to know how long the WGA strike will last. Some indicators are that it could go longer than the 2007–08 strike, which lasted 100 days. This was going to be a difficult year to secure upfront commitments, and it becomes even more difficult when advertisers don’t know when the new TV season will begin. Advertisers like certainty; that’s why they commit money upfront to secure better ad placement.