WB Predicts Profitable Season, Even Without ‘Buffy’

AOL Time Warner Inc.’s WB television network expects to have its first profitable season, assuming audience ratings remain strong and the U.S. TV advertising market as a whole improves, a company executive said.

“I think we will be profitable this year, but the challenges are greater because the market isn’t as strong as we had envisioned,” said Jamie Kellner, the former WB head who was named chief of Turner Broadcasting System Inc. in March. The unit includes the WB, CNN, TNT and TBS networks.

WB’s profit goal will be harder to meet because the network drew fewer advance advertising dollars this year than expected. WB is betting that ad sales will pick up once the new TV season starts in September, even though the broadcaster has lost one of its signature shows, “Buffy the Vampire Slayer,” to rival UPN.

The shortfall in ad-sales growth stems from the smaller “upfront” market for the six largest TV networks. Upfront, which was mostly completed last month, is when networks sell the bulk of their available ad time for the new TV season.

Ad rates for WB, which is tied with Viacom Inc.’s UPN for the position of the fifth-rated U.S. TV network, rose 3% to 5%, less than the 8% expected, Kellner said.

Upfront sales were depressed in part by NBC’s decision to cut ad rates to grab a bigger share of advertising money, Kellner said.

“At the end of the day they drove the whole marketplace down,” Kellner said.

WB said that even with the weak ad market, it was the only broadcast TV network whose upfront ad rates increased. The rise is a reflection in part of a 19% rise in WB’s ratings last season among adults younger than 50, a group highly valued by most advertisers.

WB took in $475 million, up from $425 million last year. The network, which targets teens and 18-to-34-year-old viewers, is 25%-owned by Chicago-based Tribune Co. AOL Time Warner owns the rest.