Disney CEO Bob Iger sees advertising in the scatter market this quarter is “running in the mid-20’s above” where it was last spring, but advertisers are still hedging due to the economy. “The money is being written for the near term not the long term.” He also expects retrans revenue to rise next year.
While the Walt Disney Co. may be seeing improvements in advertising on its ABC stations “that are certainly encouraging,” there has yet to be dramatic changes, Disney CEO Bob Iger said this morning.
“The visibility isn’t all that great,” Iger said at the UBS Investment Bank Global Media and Communications Conference being held this week in New York.
Advertising in the scatter market this quarter is “running in the mid-20’s above” where it was last spring, Iger said.
Advertisers, however, are still hedging due to the economy, Iger added. “The buying is still late. The money is being written for the near term not the long term.”
That cautious approach by both advertisers and consumers also is being felt elsewhere at Disney, including its travel and tourism divisions.
“I would say it’s premature for us to say we’re experiencing a strong rebound,” he said.
Nonetheless, Disney is moving forward with plans Iger said he believes will flourish when the economy does turn around — launching a new cruise ship, opening a new theme park in China and creating new content and properties from its purchase earlier this year of Marvel, the comics company.
While Iger said the company is wading through a myriad of change while monitoring consumer habits — gaming, audience viewing and cable trends among them — Iger said Disney is hardly resigned to seeing its broadcast audiences drop.
The key to get viewers to tune into TV stations has more to do with the programming than the platform, Iger said.
“It’s not that you can’t get great traction, it’s just that you need to put on something good,” Iger said, citing ABC’s Modern Family as an example of a TV show that can garner an audience.
“When you put on great programming, they will come,” he said.
Though ratings for the most recent Dancing With the Stars season “were off more than we would have liked,” Iger said ABC’s overall lead in ratings in key categories shows that interesting content pays off.
He also said that content is a boon for the company, both through overseas sales and retransmission fees, as a number of networks have more aggressive in their demands of multi-channel providers.
With negotiations with cable and satellite providers coming up in 2010, Iger said he “is sure that retransmission fees will be on the table.”
“We believe we should ultimately get paid for the value of what we deliver,” Iger said. “We have always looked at that value as part of the overall equation of what we sell or provide to multi-channel providers.”
At the same time, Disney is expanding its reach via some of its cable channels, including ESPN, the sports channel that now airs in the United Kingdom.
Having secured the rights to noteworthy sporting events, Disney saw the launch of a U.K.-based ESPN as timely, Iger said, adding, though, that breaking into the paid TV market in Western Europe “is not easily achievable.”
He also said Disney will use its cable assets — like the recently rebranded channel Disney XD, which is tweaked toward boys — as platforms to test the appeal of properties, such as the company’s new cache of Marvel characters.