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ANA and AAAA Request Joint Task Force with Networks to Address Network Integration Fee

ANA and AAAA Request Joint Task Force with Networks to Address Network Integration Fees
For the first time, advertisers and agencies come together to re-evaluate practice


New York, NY – February 19, 2008 – The ANA (Association of National Advertisers) and AAAA (American Association of Advertising Agencies) today formally invited television networks to join them on a task force to be convened no later than May 1 to address the practice of charging network integration fees.  This initiative is a result of analysis conducted by the AAAA Media Policy Committee, AAAA National TV/Radio Committee and the ANA Television Advertising Committee.

Currently, only ABC, CBS and NBC charge network integration fees; no other broadcast network, cable network or channel, local station or syndication charges advertisers to physically place their schedules. The fees add up to an annual bill to advertisers that totaled $125 million in 2007 (as estimated by TargetCast tcm).  In addition to the $125 million, network integration fees have other hidden costs to both agencies and advertisers.  They are a burden for agencies to administer and the extra manpower required to do so invariably costs advertisers more in labor fees.

In studies of ANA members that were previously conducted, 87 percent of those surveyed answered “no” when asked, “Is it fair to be charged network integration fees by ABC, CBS and NBC?”    Verbatim comments included:
• “The notion of integration fees is antiquated … This is a throwback fee from the old days when commercials had to be physically integrated into programming.”
• “It's obsolete and doesn't recognize technology changes.”
• “The fees are a legacy charge and no longer have a justifiable purpose.”

“These fees place an unwarranted burden on marketers,” said Bob Liodice, President and CEO of the ANA.  “We strongly encourage ABC, CBS and NBC to reconsider this practice, as a measure of good faith towards marketers, whose sponsorship enables networks to keep their programming on air.”

“Our members are at the mercy of the networks here,” said Nancy Hill, President of the AAAA.  “The old processes of integrating commercials into media are no longer necessary in this digital era, but airing commercials on these major networks is.  We look forward to having the chance to discuss this matter with the networks in a fair and balanced way.”

This topic will be discussed at the ANA’s upcoming Television and Everything Video Forum, to be held on Thursday, February 28, at the Marriott Marquis in New York City’s Times Square.  The AAAA’s upcoming 2008 Media Conference will be held from March 5-7 2008 at the Rosen Shingle Creek in Orlando, Florida.  More details can be obtained by contacting Lesley Weiner of the ANA, at lweiner@cooperkatz.com, or Kipp Cheng of the AAAA, at kipp@aaaa.org.  

ABOUT THE ANA
The Association of National Advertisers leads the marketing community by providing its members insights, collaboration and advocacy.  ANA’s membership includes 360 companies with 9000 brands that collectively spend over $100 billion in marketing communications and advertising. The ANA strives to communicate marketing best practices, lead industry initiatives, influence industry practices, manage industry affairs and advance, promote and protect all advertisers and marketers.  For more information, visit www.ana.net

ABOUT THE AAAA
The American Association of Advertising Agencies is the national trade association of the advertising agency business. The 1,196 member agency offices it serves in the U.S. employ 65,000 people, offer a wide range of marketing communications services, and place 80 percent of all national advertising. The management-oriented association helps its members build their businesses, and acts as the industry’s spokesman with government, media, and the public sector. For more information visit our Web site at www.aaaa.org.

CONTACT
Lesley Weiner
CooperKatz & Company for the ANA
(212) 455-8079
lweiner@cooperkatz.com

Kipp Cheng
AAAA
(212) 850-0720
kipp@aaaa.org

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