January 25, 2023
TV Nets Report Dip In Ad Rev, Fox Hit Hardest Among Broadcasters
- by Wayne Friedman , January 14, 2015
In the fourth quarter, TV networks continued to struggle in terms of U.S. domestic advertising revenue and viewership. Collectively, the four major TV networks witnessed a 1.5% drop in advertising
revenue to $4.68 billion — with Fox taking the biggest hit, according to MoffettNathanson Research.Fox was down 9% to $971 million, while ABC slipped 2% to $895 million. The best results came from NBC, up 2% to $1.64 billion (including NBC-owned stations). CBS inched up 0.5% to $1.2 billion.
Cable networks also took a hit, down 1.3% in total for the major network groups to $5.65 billion.
Viacom networks were down 6% to $1.05 billion; Discovery (sans BBC America) slipped 4% to $395 million; Disney was off 3% to $1.19 billion; and NBCU/Comcast networks dropped 25 to $889 million.
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Better performers included AMC Networks, up 15% to $236 million; 21st Century Fox, 5% to the good, totaling $470 million; and Scripps Networks, improving 3% to $452 million. Time Warner cable networks were flat at $971 million.
Overall ratings performance continued to hurt all TV networks with prime-time 18-49 viewership in C3 ratings — commercial ratings plus three days of time-shifting — down 7% each for cable and broadcast networks. This was the lowest level since the first quarter of 2013.
CBS had the best results during this period — up 2% to 2.58 million 18-49 viewers — while ABC was up 1% to 2.37 million. NBC was down 10% to 3.29 million, and Fox was off a steeper 21% to 2.09 million.
On the cable side, Fox networks grew 5% to 858,000, with virtually all other cable network groups sinking — the worst coming with A&E down 20% to 887,000. Also in double-digit declines were Viacom, off 18% to 2.18 million; NBCU, losing 15% to 1.3 million; and AMC Networks, down 11% to 438,000.
3 comments about "TV Nets Report Dip In Ad Rev, Fox Hit Hardest Among Broadcasters".
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Assuming that the ad revenue stats are accurate, a good deal of this stems from the changes in CPMs that took place in the 2014-15 upfront sale last spring. Whether "scatter" sales will offset the upfront CPM losses for the whole season remains to be seen. As for the rating declines, one has to examine the patterns for all channels, not just a selected few, to draw any conclusions. Is all viewing down? If so, that raises questions about Nielsen regarding panel turnover and other technical issues. The audience losses may reflect a small defection of viewer tonnage to other sources of content or it may just be a function of problems that certain channels are having in holding on to their viewers----or it may be something else. I don't think that the sky is falling, however.
Ed your analysis is a bit flawed. Audience shrinkage is definitely being recognized by the most astute and largest advertisers. Look deeper and you can get the touch points. The real question is it cyclical or secular? Starting with the younger audiences.....
Leonard, those larger, more sophisticated advertisers continue to pay higher and higher CPMs for smaller audiences for a variety of reasons, not just the "eyeballs" reached. First, and foremost, they believe that TV commercials in engaging program content environments are the most effective ways to communicate their branding messages. They also realize that by spreading out their buys on many TV channels, that they can attain reasonably high reach levels. Until that changes---and there is little sign that it will for many years to come----- they will pay more and more per viewer, assuming that the sellers have the sense not to suddenly escalate their CPMs to double or triple their current levels. Of course, within TV, the dollars are being slowly but steadily being diverted from broadcast to cable, due, mainly but not exclusively, to the latter's lower CPMs. But it's still TV----"linear TV" that they are relying on. I should add that many advertisers are expanding their digital video ad spending, however, until there is more suitable content to wrap around their ads and the viewability mess is cleared up, many will continue to dabble rather than go whole hog into video ads. So, its up to the digital medium to take responsibility and function an ad-friendly option, before any significant shift away from "linear" TV is even thinkable. I can't prove it but I believe that a good deal of the dollars now flowing into digital video ad buys are being siphoned off from promotional, plus print media, radio and spot TV budgets, not national TV.