SMI: New Season TV Revenue Hit With Rocky Trends

TV network observers are wondering if NFL telecasts will reverse their downward ratings spiral which some believe has been impacted by viewers39 interest in the oftengripping political news coverage As I detail further down in this story SMI39s latest ad spend data for September shows mixed results for NFL telecasts and there39s the danger that those numbers will weaken as advertisers react to the ratings dropoffsWhat39s more ratings for nonsports programming in primetime haveamp160been soft on average amp160although there have been some breakout new series led by This Is Us on NBCThe soft ratings are expected to lead to an increase in makegoods That will influence midseason revenue and average unit costs for the networks And we will start to see these numbers during the coming weeksThere are at least three other trends that are adding to the scenario for network TVFirst is recent word from auto sales forecasters that newvehicle sales are likely to be off in October for the third consecutive monthSecond two fantasy football league advertisers FanDuel and DraftKings have pulled way back on network advertising due to a number of lawsuits In fact they settled a legal dispute last week with the New York state attorney general to the tune of 6 million each amp160In September DraftKings and FanDuel bought 100 million less on broadcast and cable advertising than they did in September 2015 The extraordinary amounts they spent last year on advertising areamp160unlikely ever to be repeated due to the restrictions that lawmakers will impose on themThird the big uptick in Upfront commitments for the current broadcast year has yet to materialize As a result of the large Olympic ad spend in August some clients are taking a breather and most of their upfront dollars won39t kick in until 2017Ad revenue figures for September reflected many of these trends amp160SMI39s data shows that spending at the top four broadcast networks ABC CBS NBC and Fox was off significantly down 132 year over year Cable networks certainly did better but their averaged results weren39t anything to write home about up 07 versus same month last yearPrimetime advertising revenue at the top four broadcasters was down even more than the total day off 16 in Septemberamp160 Their average primetime unit cost for nonsports programming was down 76 to 86000On the sports programming front the average cost of a 30second spot during NFL games rose in September up 8 to 509193 on average versus same time last year But the unitrate results for individual networks carrying the games has been mixedESPN39s Monday telecasts experienced a 4 decline on averageCBS39s games on Thursday night were flatOn Sundays Fox and CBS garnered an 11 increase and NBC rates were up 9A deeper understanding is garnered when one examines individual advertising categories Looking specifically at primetime nonsports program advertising 19 out of the top 20 categories registered declines in September in yearoveryear comparisons ranked by total revenueHere39s a look at the top fiveAutomotive vehicles and dealerships were down 317Prescription pharmaceutical was off 275Telecommunications dove 269Entertainment sank 348Food produce and dairy declined 243The same ad sectors look better when primetime sports program ads are included in the mix but they all still registered declinesAutomotive vehicles and dealerships were off 182Prescription pharmaceutical was down 262Telecommunications dipped 220Entertainment dropped 246Food produce and dairy sank 114The ad spend results are dramatically better when viewed on a quarterly basisamp160 Revenue from the Olympics had a huge impact When cable and broadcast are combined ad spend was up 93 Broadcast alone saw an increase of 181amp160and cable bumped up 37 all in comparison with the same quarter last yearTo be sure not all of the trends spell doom and gloom moving forward There39s the hope that the networks will garner better ratings moving forward It could be that auto advertisers decide to spend more money on television ads not less as competition tightens for consumer dollarsAnd perhaps the NFL39s downward trend will reverse course once viewers39 attention is less distracted by the Hillary and Donald saga Stay tuned for my analysis of October data in just a few weeksClick the social buttons above or below to share this content with your friends and colleaguesThe opinions and points of view expressed in this article are exclusively the views of the author andor subjects and do not necessarily represent the views of MediaVillagecomMyersBizNet Inc management or associated bloggers

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SMI: New Season TV Revenue Hit With Rocky Trends

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James Fennessy

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