MSOs: Double-Digit Ad Growth in '02

2/23/2003 7:00 PM Eastern

Double-digit advertising sales gains seemed to be the norm for MSOs during 2002.

According to executives from four operators, ad sales rose anywhere from 10 percent to 15 percent. Most attributed the improved sales to the automotive, retail and media sectors.

Comcast Advertising Sales senior vice president and managing director of sales Hank Oster said the Philadelphia-based MSO's total ad sales rose 15 percent in 2002, bolstered by a 21 percent fourth-quarter upsurge. As for the recently acquired AT&T Broadband systems, they posted a 10 percent uptick last year, bolstered by a 13 percent gain in the final period, Oster said.

Automotive remained Comcast's No. 1 category last year, trailed by media, retail and fast foods, said Oster. Political advertising was "a fairly decent, fairly strong category," he added.

At Cablevision Systems Corp.'s operations in the New York DMA, ad sales rose "in the low double digits" last year, said Rainbow Advertising Sales Corp. president David Kline — a good performance in such a mature market, he said.

Insight Communications Co. registered final-quarter and full-year sales growth "in the mid-teens" said Insight Media Advertising vice president Kevin Dowell, who declined to offer more specifics until the MSO reports its 2002 financial results.

"Political and automotive were our big drivers," said Dowell, who added that furniture and department store retailers were also strong. Down sectors included travel, the auto aftermarket, real estate and financial companies, he added.

Fourth-quarter sales at OnMedia — the ad-sales unit of Mediacom Communications Corp. — rose 13.6 percent, said vice president of sales development Steve Litwer. That led to a full-year growth rate of 10.6 percent, well above budget.

Those results were "normalized for the months that Mediacom did not own and operate the systems taken over from AT&T Broadband, January through June 2001," he said.

Top sectors in 2002 were automotive, accounting for 19 percent of total ad-sales revenue; financial services, 7 percent; and retail and department stores, also 7 percent, said Litwer.

Automotive "is looking very strong for the first quarter," Comcast's Oster added.

This year, the freshly merged Comcast is targeting telcos — including wireless providers — and theatrical films as sectors showing promise in their cable ad-spending outlook.

Insight started the year strong, said Dowell.

"January exceeded our annual and fourth-quarter performance for '02," he said. While March is also strong, he noted, "February appears to have softened a little bit."

A big reason: comparisons to strong Winter Olympics ad sales a year ago.

In 2003, Dowell said, Insight intends to become "very aggressive on network and
company/system promotion initiatives" as the best way to tally incremental revenues in a tough climate.

On the Mediacom front, through the first week of February "OnMedia [was] pacing at 9.7 percent ahead for first-quarter 2003," said Litwer.

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