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Economic reality opening new opportunities.

Cash is king in Europe, while TV barter is rarely mentioned Several attempts were made in the past to provide free international programs in exchange for commercial spots in the same programs, but rarely succeeded in Europe or elsewhere for that matter. For years TV barter seemed to have been a phenomenon strictly within the U.S., where it was first developed and is still flourishing

Now, however, a new try is being made at international TV barter and it is succeeding in Eastern Europe, China and even in Western Europe. Explained a European satellite broadcaster, "If the buyer doesn't want a barter deal, he often agrees to pay cash and let the seller put spots into the program at the lowest rate."

Nevertheless, international barter still generates negative feelings. "The highly-developed networks in Europe feel about barter pretty much the way the U.S. networks look at it generally they just don't want it" said Rainer Siek, CBS International sr. v.p. sales. Yet Jim Warner, the president of CBS International, has just hired Jeff Normorofsky as director of sales development, precisely given the job of exploring the barter situation internationally.

"He'll do it for a couple of months and we'll see how it goes," said Siek. "The judgment is still out." At the same time, he recalled CBS' successful week on Russian TV last December; "One has to keep in mind that virtually all the broadcasters in the developing world are cash-strapped. Usually you do barter deals when you can't get cash, but even that can be difficult because eventually you still have to exchange it all into cash. We are working on that."

At Hearst Entertainment, Terry Botwick, the president of distribution and national programming, strikes more optimistic note The company distributes internationally on a barter-basis Amazing Love Stories, produced by Bristol Myers. According to Botwick "This deal encourages us to try and make barter arrangements, We are not penalized by them. Economic pressures on everyone create a greater openness to barter. The key with us is that we are going in with an advertiser. To make a barter deal with a station and then go look for an advertiser isn't easy. But to go in with a strategic partner makes a lot of sense."

In Botwick's view, the larger territories are gradually opening up to the barter notion, and he points to the U.K. as a prime example. "The trick is to balance what the advertiser's needs are, with getting The right network," said Botwick, a former cable TV network programmer

Botwick points to Bristol Myers as the ideal company to go into barter deals with "They have the brands and they spend money," he noted.

Indeed, it is expected that, in the future, manufacturers will increasingly finance production of TV programs that are considered good vehicles" to promote their products. Similarly, it is expected that these manufacturers will want to control the TV "environment" to assure that no other spots are sold to competitors

Gary Montanus, the Worldvision marketing v.p. and U.S. barter specialist, said that international barter will come, "but it just hasn't matured yet," One of the problems, said Montanus, is that international "broadcasters want to control their own inventory."

But, concluded CBS' Jim Warner, "we are committed to building this part of our business because we feel the world is changing and this is yet another way of marketing our programs. We aren't sure at this point whether it will be a big, a middling or a small business, but we intend to find out."
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Title Annotation:TV barter
Publication:Video Age International
Date:Apr 1, 1993
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