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State of the Screens

TV Networks Stuff in More Commercials Despite Vows to Cut Back

By August 29, 2019No Comments

Shocking!  Many TV networks continue to increase ad loads despite public promises to do otherwise.

Why this is happening: In order, to maintain/grow revenue while ratings are down you can either increase the cost of advertising (CPMs) and/or you can increase the number of ads that run during a program.  Many networks are finding it easier to increase ad loads than ad rates.

Quote from Michael Nathanson – Analyst @ MoffettNathanson:
“Look at the decline in ratings…Everyone’s got pressure to make their quarterly numbers. Long-term, it’s a very bad decision, but you don’t want to miss your numbers and have your stock go down.”

Ad minutes per hour by network according to MoffettNathanson:
Viacom – 14.3
A+E – 14.0
AMC Networks – 13.0
Turner – 12.5
NBCUniversal – 12.0
Discovery – 11.6
Disney – 10.5
Fox – 10.4

Flashback #1: Hulu cuts ad breaks by more than half

Hulu commercial break lengths (% change):
Old – 180 – 240s
New – 90s (↓ 50-63%)

Flashback #2: YouTube begins showing twice as many ‘pre-roll’ ads

Key findings from NBCUniversal on the impact of reduced ad load:
1) Ad Likability — ↑ 38%
2) Likelihood to search for a brand — ↑ 39%

Michael Beach

Michael Beach is the Chief Executive Officer of Cross Screen Media, a media analytics and software company that enables marketers to plan, activate, and measure CTV and linear TV at the local level. Michael is also the founder and editor of State of the Screens, a weekly newsletter focused on video advertising that is a must-read for thought leaders in the advertising industry. He has appeared in such publications as PBS Frontline, The Wall Street Journal, The New York Times, Axios, CNBC and Bloomberg, and on NPR’s Planet Money podcast.