An interesting article in Ad Age reveals that part of the deal between GE and Comcast that give Comcast a controlling interest in NBC Universal requires GE to keep advertising on NBCU properties for five years after the deal closes. GE will have to pony up a minimum commitment of $59 million dollars annually on gross advertising. It also requires GE purchase an additional $50 million worth of advertising in connection with the 2012 olympics.
At the minimum levels of $59 million/year, it would be much less than what GE is currently spending advertising on NBCU properties. According to TNS Media Intelligence, GE spent $145.9 million advertising on NBCU properties in just the first nine months of 2009. And that's down almost 17 percent versus the first nine months of 2008.
Hmmm… 145.9 millions pays for a few more seasons of chuck!
So GE (prior to Comcast deal) had no faith in its own properties by decreasing ad spending by 17 percent year-over-year? Guess that explains why NBC is still Zucked with Zucker in charge now.
Errol, it’s more likely a reflection of ad budget cuts across all of GE.
Julia,
I’m sure that was the reason, but it’s ironic since they cut ad spending at their own networks’ expense which should have been almost the reverse.
PBS NewsHour on the NBC Merger.
Errol,
You do realize that GE is bigger than NBC? Make that much bigger! GE does not make corporate budget decisions based on what will benefit NBC. Your suggestion that GE would even consider increasing costs across its entire organization just to help NBC’s financials is asinine.
Julia,
You are absolutely correct. It is astounding to me how some people make comments on this site about business decisions knowing they have zero business sense.
I didn’t imply, at least intentionally, that GE cut NBC’s budget. I’m saying that GE itself opted not to spend as much money advertising itself and its products (not television/studio productions) on its networks.