A spot check of various MSOs indicated that their ad-sales
percentage gains for full-year 1998 ranged anywhere from the upper teens to 30 percent.
They're also optimistic about this year's
outlook, despite uncertainty surrounding General Motors Corp.'s takeover of $500
million in dealers' ad funds.
Pat Esser, vice president of ad sales for Cox
Communications Inc., said his MSO's ad sales rose by an "outstanding" 30
percent for the year on a same-store basis with 1997. That finish was bolstered by a
strong 27 percent upsurge in the final quarter, largely due to the fact that
"political came in huge." Those results were "a bit over plan," he
Similarly, Ron Pancratz, Cable One's vice president of
ad sales, said that MSO, strengthened by "a fine [fourth] quarter," finished
1998 with an "excellent," above-plan 30 percent increase in a same-store
comparison with 1997.
The final quarter was "close to that" growth
level, lifted by a "fantastic November," he said, although he couldn't
single out any categories as outstanding.
The lack of the National Basketball Association in the
fourth quarter "was pretty much a nonissue," Pancratz said, since Cable One
isn't in any NBA franchise cities, and most of its sports accounts shifted into
ESPN's and ESPN2's college-basketball coverage.
Larry Zipin, Time Warner Cable's vice president of ad
sales, said that MSO finished 1998 28 percent ahead of 1997 -- with "political
[providing] the real windfall last year," lifting it several points ahead of budget.
In Time Warner's biggest DMA, Larry Fischer, president
of Time Warner CityCable, New York, said his operation's sales rose 29 percent in
1998. (That figure includes New York 1 News, but not the New York Interconnect, which Time
Warner quit after the first quarter of 1998.)
MediaOne Group Inc.'s Ed Dunbar, vice president of ad
sales, said only that MediaOne's sales grew by 22 percent in 1998, and that he's
hoping to match that this year.
Kevin Dowell, group ad director for Jones Intercable
Inc.'s Chicago region, said his systems finished 1998 with a 16 percent increase in
local ad sales, or 5 percent above budget.
Pointing out that the operator's Chicago-area national
and regional business goes through the Chicago Cable Interconnect, Dowell said Jones'
national sales growth outperformed regional; Dowell also serves as the interconnect's
Dowell said the standout categories for both Jones and the
Chicago interconnect included political, public utilities, automotive (chiefly domestic),
travel, financial and home furnishings. Media was another hot category for the
interconnect, he added, while small retailers and restaurants were strong for Jones in the
Esser, noting that Cox enjoyed strength "across the
board" in ad categories, singled out media as a particularly healthy one last year.
Fischer cited Internet-related companies, movie and
Broadway theaters, hospitals/health care, financial, music retailers and retailers in
general as fueling TWCC's 1998 growth.
For 1999, most MSOs are confident that ad sales will match
last year's. The only potential dark cloud on the sales horizon is GM's takeoverof its dealerships' ad funds -- a move that could detour dollars from some
markets to bolster the No. 1 automaker's market share elsewhere.
"I'm worried about the GM situation,"
Pancratz observed, "but then I remember last year, being worried about the GM
strike," which, he added, didn't turn out badly after all.
The fact that GM now will oversee an estimated $500 million
in dealers' ad dollars is "a cause for concern," Esser agreed,
"although we haven't seen any financial falloff" thus far.
Fischer also felt that GM "could have an impact,"
but he added that it's too soon to tell.
"It's a potential problem," Zipin said,
"but where we're clustered on a regional basis, we certainly have a strong story
Time Warner intends to adopt "a proactive
strategy," both on its own sales calls on GM and on those with spot rep firm National
Cable Communications, Zipin added.
For the current quarter, sales are "pretty much on
plan," Esser said, although he was reluctant to venture any projections for 1999 this
early in the year.
Pancratz, likewise bullish about the year ahead, said he
expects to make his first-quarter budget, buoyed by "a January that was excellent for
us. February was off a little, but March is coming back."
Time Warner is running 25 percent ahead for January through
February, Zipin said, adding that March is looking the same. That's ahead of budget
for a quarter that's usually soft, he observed.
Despite rumblings that ESPN may fork over more local
National Football League avails in the coming season, Zipin said he's not banking on
that. "We're budgeting on the status quo," he said.
Time Warner CityCable is "pacing up 33 percent"
for the initial quarter, Fischer said. "We're off to a huge start," with
hefty NBA ratings likely to contribute to the lift, he added.