Continuing their strong sales pace through the first quarter, cable operators' local revenues should gather additional momentum in the coming months, due in part to Animal Planet becoming the latest network to increase local inventory for affiliates.
Discovery Networks U.S. will add one 30-second unit per hour, to three and one-half minutes, as of today (April 24), "in response to affiliate requests," a network spokesman confirmed last Thursday.
That unexpected local-inventory uptick should bolster operators' sales results, Cox Communications Inc. vice president of ad sales Billy Farina said.
Last year, Bravo, The Film and Arts Network began offering upscale-skewed local avails, and this spring, ESPN made good on its promise to substantially increase the number of local spots on its popular SportsCenter show. Sister The Walt Disney Co. network Toon Disney announced plans to go ad-supported this fall. Toon Disney has told affiliates it will offer three local minutes per hour at that time.
Of those networks, only ESPN-already by far the leading network in generating local-ad revenues-has projected ad-dollar increases that could come affiliates' way. Its executives estimated in March that the hefty uptick in local avails could mean $100 million per year in additional local dollars for operators.
All of those new local units should offset the uncertainty surrounding political advertising and cable's first Summer Olympic Games (due to begin in mid-September).
Farina described Cox's first-quarter sales performance as "tremendous," but declined to go into specifics.
Similarly, AT & T Broadband officials said they couldn't discuss the opening quarter's results. Other MSO executives were on the road, in meetings or unwilling to discuss first-quarter results last week.
Cox-which is among the MSOs that have committed to the Sydney, Australia, Summer Olympics coverage on CNBC and MSNBC-has already found considerable interest among local clients, Farina said. That interest is not limited to sports accounts, but rather, it "runs the gamut," he added.
On the other hand, Cable One Inc. is among those MSOs that haven't signed. "We're still negotiating.so I can't count on Olympic dollars [yet]," vice president of ad sales Ron Pancratz said.
Pancratz called Cable One's initial quarter "pretty good, slightly over budget in revenues and a little further over in cash flow."
Cable One-which came off "a huge fourth quarter"-is optimistic about the year ahead since "the economy is pretty strong and ad spending is pretty strong," and the MSO continues to grow share in ad sales, Pancratz said.
Political-ad sales have been disappointing thus far, so, Pancratz conceded, "We can't anticipate huge political dollars" in the months ahead.
National Cable Communications vice president of affiliate relations Steve Houck said spot sales jumped by more than 40 percent in the opening quarter.
Local spot cable will climb $400 million, or 14 percent, to $2.9 billion this year (out of cable's total of $13 billion, a 16 percent gain), according to Cabletelevision Advertising Bureau projections.