NBC Keeps Its Perch

The more things change, the more they stay the same. Despite losing its cash cow show Friends this spring, General Electric's (NYSE:GE) NBC television network reportedly has again won the most advertising money for its prime-time shows this coming fall season.

As Rick Aristotle Munarriz wrote late last month, May is a do-or-die month for television networks. For a few weeks, TV executives have to put their best foot forward in order to get advertisers to pony up top dollar, up front, for most of the commercial space for prime-time programming. NBC has had an easy time of this for several years, owing to its powerhouse lineup.

This time around, NBC's ability to pull in the most cash, despite broad changes in its portfolio, may be a testament to its salesmanship rather than its top-notch entertainment offerings. No one doubted that Friends and Frasier would be hard to replace. But Friends' replacement, Joey, is still in flux, as NBC recently confirmed that the series' producers made a major casting change. Another show, Father of the Pride, reportedly flopped in advanced screenings. It seems NBC's track record of delivering sit-com smashes may have been the factor that won over advertisers, rather than optimism about the new fall lineup.

This track record could come to an end this year. According to the Washington Post,Viacom's (NYSE:VIA) CBS is nipping at NBC's heels. While NBC was top dog in terms of overall dollars, CBS was able to hike its rates 9% to 10%, the highest increase among the networks. News Corp.'s (NYSE:NWS) FOX, meanwhile, maintained its sales level from last year, bringing in $1.6 billion, while Disney's (NYSE:DIS) struggling ABC saw its take slip from $1.7 billion to $1.5 billion.

The ending for the ad story has yet to be written, however. Networks typically hold back 15% to 25% of their commercial airtime for later sale, and they have reportedly held back more of their inventory this year than last. If NBC's new lineup stumbles, other players still have a chance to steal the show.

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Fool contributor Brian Gorman is a freelance writer living in Chicago, Ill. He does not own shares of any companies mentioned here.