Surprise! NBC says local advertising is down

Posted September 28th, 2008 by Michael

Jeff Zucker, CEO of NBC Universal told Reuters that his networks are loosing local advertising due to the economy.  He says it is not on a national level yet.  This is a good thing, but it may only be the beginning.

NBCU, this past year made some moves to protect its interests and start investing for the future.  They launched Gemini Division an online program a little while back.  It seems more like an experiment than an actual plan of action.   The episodes are short, about 5 minutes, but then four of them are stitched together that makes it seem like a weekly TV episode, except for the production credits at the end of each short.   There is a lot of product placement, which is present throughout the story.  I think it is a fairly clever and successful way to make up the production budget, but there is a problem with this strategy.

The issue comes back to the advertising dollars.   As those monies dry up, NBCU will need some system to appease the affiliate stations around the country.   The internet only investments will be for nothing if NBCU plans many more internet only programs to hedge the economy downturn.   As the affiliates tire from their arrangement with the parent company, what will be their course of action?  WIll they have any at all?

Tags: Affiliate, Gemini Division, NBC