That light you see at the end of the tunnel may just be an oncoming advertiser. In a sign that the media economy, and by extension the overall economy, may finally be pulling out of a two-year funk, the marketplace for advertising time on cable networks during the fourth quarter is heating up considerably. Ad buyers say prices for spots are rising as companies in the packaged goods, soft drink, alcoholic beverage, wireless communications, movie studio, retail and automotive categories have touched off a second wave of spending in the fourth-quarter scatter market.

Market participants said Johnson & Johnson made a significant buy on TV Land, paying 40% above rates the network was charging during June's upfront, when advertisers buy TV time in advance for the four quarters starting with the new TV season. Also paying a hefty premium was JC Penney, market sources said. Other buyers included General Motors, Mercedes-Benz, the broadcast networks, MCI (which is in bankruptcy, so it's making its purchases with cash) and T-Mobile, the new phone service.

Advertisers made heavy commitments to all the broadcast networks and to several cable nets that sold volume at lower prices during the upfront. With so much time sold during the upfront by the broadcasters and by price-cutting cable networks including USA Network and Lifetime, the supply of spots in the scatter market is limited, putting upward pressure on prices.

?When you get 80% to 85% sellout in the upfront and a good scatter market in broadcast, cable should do very well,? said Harry Keeshan, EVP, director of national broadcast, for media buying agency PHD.

?There are a few [cable networks] that are certainly in some sellout situations or close to it,? said Chris Geraci, director of national broadcast at OMD. ?You can tell in terms of the pricing they come back to you when you submit a budget.?

?They're all pretty bullish on pricing,? said Peter Spengler, EVP, director of national broadcast, at Initiative Media, who said cable networks are getting prices in the ?high single digit or over and above the upfront.?

That means that ?anyone who participated in the upfront is very thankful they did at this point because, at least so far this broadcast year, there's some significant scatter inflation,? Geraci said.

The fourth-quarter scatter market started early, just before Labor Day. ?There appears to be a second wave of budgets,? said Spengler. ?It was quiet for three or four weeks. And now I'm getting the sense there's another wave. The networks are very happy.?

While cable network sales executives speculated that some of the money they're seeing must be coming from advertisers who were either too late to get time on the broadcast networks or couldn't afford the higher prices, ad buyers disagreed. ?It's the same media plan, it isn't money that we couldn't place on broadcast moving into cable,? said Keeshan. ?The money that was earmarked for broadcast we were able to place.?

But some broadcast money might yet come cable's way. ?Daytime is getting real tight. I wouldn't be surprised if even from an inventory standpoint you've got to find another alternative,? Spengler said.

The activity is allaying worries that fears about the economy and corporate profits would put a drag on ad sales. ?Maybe toward the end of the year there's going to be a need to put some more dollars toward the bottom line, but it certainly hasn't happened yet,? Geraci said.

Mark Lazarus, president of Turner Network sales, said TBS's comedy block is sold out, but that he's still got some inventory on TNT's premium programming. Prices, he said, are up 20% from the upfront. Lazarus said that with the prices so high for the fourth quarter, he's already made some deals to sell commercials in the first and second quarter in packages with fourth-quarter spots.

?The market is really robust,? said Bill Abbott, VP of ad sales at Hallmark Channel. ?[Broadcast] prices continue to be high and inventory is low, so money is filtering to cable and other dayparts. We still have inventory, but we anticipate that within the next four weeks we'll be sold out certainly for the remainder of the quarter.?

?It's an unusual market. Usually if there's a strong upfront, there's a weak scatter. This defies what usually happens,? said David Cassaro, senior EVP of sales and distribution for E! Networks. ?The smart money is getting down now because the prices are only going up,? Cassaro said.

?The market is very fast and very strong,? said Charlie Collier, EVP of ad sales at Court TV. ?So far, we're writing business every week, and we're pleased with the pace.?

Local cable is also benefiting from the spending burst by national advertisers. ?The market is tightening up on the spot market as broadcast sells out,? said Andrew Ward, EVP, director of sales, at National Cable Communications. NCC is forecasting that fourth-quarter ad revenue will be up 28%, and that revenue will be up 19% for the year. ?We're seeing a very healthy year,? he said.

THE NEXT QUESTION:

• Will the burst in ad spending propel the national economy into significant growth?
• Will an ad boom benefit languishing MSO stocks?

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