Behind the glitzy launches of US television's autumn schedules this week, a nervous question is being asked: how much longer will this annual beauty pageant matter to the advertising executives in the audience?
This is traditionally the week when some $9bn (£5bn) of ad spending is carved out among the television networks, but two of the country's biggest advertisers, Coca-Cola and Johnson & Johnson, have indicated they will sit it out for now.
Whereas in previous years about 80 per cent of prime-time advertising slots would be filled in the frenetic days after these presentations, few pundits think that figure will be reached this time. The consensus view is that the total ad revenues from this week of "upfronts" will fall below last year's $9.1bn.
The reason: as the internet increases in importance as an alternative entertainment source to television, so it is increasing as an alternative place to advertise, too.
On the surface, the task for the networks is the same as ever. Pile on the razzamatazz and give an equally hard sell to new shows and old favourites. NBC has been trying to create a buzz over Studio 60 on the Sunset Strip, a new vehicle for the ex-Friends star Matthew Perry. ABC insists Grey's Anatomy can wrest viewers from CBS's CSI: Crime Scene Investigation in a bold head-to-head battle. Tomorrow Fox will trumpet its continued domination of the key 18- to 45-year-old demographic with shows such as American Idol.
But the upfronts are different this year, and the networks can feel their clout with advertisers declining. Johnson & Johnson, whose consumer brands include Johnson's baby powder and Neutrogena shampoo, would not previously have risked waiting to buy its television ads in the last-minute market. But prices in this so-called scatter market have weakened. This is in part because one in eight households in the US now has a digital video recorder, such as a TiVo machine, and can skip the commercials. And partly it is because of all the opportunities for switching advertising dollars to the internet. J&J insiders say the company could allocate up to 20 per cent of its advertising budget to non-traditional media.
The networks are no longer talking up the scarcity of commercial breaks in an effort to inflate advertising rates. Instead, they are talking up a proliferation of new opportunities to advertise alongside hit shows. They are groping for an internet strategy, trying to hold on to as much share of the ad cake as possible.
NBC - the least watched of the four main networks - has gone furthest so far this week, promising to launch two new "channels" on the internet, including one where shows such as ER and the US version of The Office might be premiered before they are shown on television. There will also be specially created mini-episodes of some shows. With 70 per cent of US homes predicted to have broadband by the end of this year, NBC is increasingly putting video ads on its sites as well as traditional, but less lucrative, pop-ups and banner ads.
Randy Falco, chief operating officer of NBC Universal TV, said the company was responding to predictions that upfront sales of autumn television ads would be slightly down this year. "Everybody is holding back just a little bit of money," he said. "When good digital ideas come in, they want to be able to participate."
The Disney-owned ABC, which has the highly bankable shows Desperate Housewives, Lost and Grey's Anatomy, is already selling episodes direct to viewers over iTunes, to try to reduce its need for advertising at all. But it is also experimenting by making the shows available online, with technology that prevents viewers skipping adverts.
All eyes now are on the multi-media plans that might be discussed by Fox, the network owned by Rupert Murdoch's News Corp, which presents its schedule today. Its parent company has launched a sister network, called MyNetworkTV, which borrows branding from the MySpace community website that News Corp bought last year. Mr Murdoch is searching for ways to attract advertising and other revenues to a site used by 75 million mainly young people. So far, he has unveiled plans to sell episodes of Fox shows such as 24 on MySpace, and stars from MyNetworkTV shows will be given their own MySpace pages.