Cable Networks’ Ad Sales Lead TV Pack This Year
by Linda Haugsted -- Multichannel News, 12/16/2007 7:00:00 PM
Cable networks had a strong summer, leading television media with a 4.7% growth rate for the first nine months of the year compared to 2006, according to TNS Media Intelligence.
Overall, the U.S. advertising market grew just 0.2% for the year to date. Ad sales are at $108.2 billion for the year, with third-quarter growth offsetting losses posted in the first quarter. In the TV sector, cable was the sole gainer. Network TV advertising is at $47.2 billion, but that’s a 3% loss from the same period last year.
Spot TV is down 6.8%; Spanish-language TV is down 0.2%; and syndicated TV is down 4.6%
Cable’s growth can be attributed to seasonal factors, said Jon Swallen, senior vice president of the strategic advertising and marketing information firm. As broadcasters go into repeats for the summer, viewers check out cable fare. Higher ratings translates to higher ad rates in July and August, he said.
The leaders of the cable-advertising pack are the ESPN networks. Those sports services are up “very sharply” on revenue, attributable to increased carriage of NASCAR stock-car races, Swallen said. Among all cable networks, the performance of ESPN “stands out,” he said.
But there remains a dark cloud over cable’s growth. Part of its sales is to direct-response advertisers, meaning the inventory was probably sold at discounted prices. That industry is a large consumer of inventory during time periods that would otherwise remain unsold, like overnights.
Insurance companies have been strong advertisers for cable, he said, as has the financial-services sector, in spite of the subprime mortgage crisis.
But the TV sector is likely to take a hit in advertising revenues beginning in the first quarter of 2008, as the ongoing Writers Guild of America strike leads to more reruns on the schedule. In broadcast, upfront advertisers will have to decide in January whether to cancel the second half of their advertising contracts.
That could return a significant volume of inventory that networks would have to try and sell to other advertisers at a time of significant ratings erosion, he noted.
| Where Ad Dollars Flow | |||
|---|---|---|---|
| Advertising spending, by media: | |||
| Jan.-Sept. 2007 (Millions) | Jan.-Sept. 2006 (Millions) | Percent Change | |
| *Network TV figures include MyTV and The CW, which launched 9/06 SOURCE: TNS Media Intelligence |
|||
| Network TV* | 16,163.9 | 16,658.9 | -3.0 |
| Cable TV | 12,730.5 | 12,155.0 | 4.7 |
| Spot TV | 11,224.2 | 12,038.1 | -6.8 |
| Spanish-language TV | 3,251.9 | 3,257.7 | -0.2 |
| National syndication | 3,030.3 | 3,176.6 | -4.6 |
| Internet | 8,380.0 | 7,149.3 | 17.2 |
No related content found.
Featured Company
-
Telestream
Telestream products are used by the world's leading media and entertainment companies and corporations for transcoding and workflow automation. Telestream helps customers transform their media for multiplatform distribution to web, mobile, DVD, cable VOD, podcast and broadcast pl..more
VIEW ALL GALLERIES
