Ad sales president Mark Marshall (pictured) touts scale and precision.
AT&T’s HBO Max says it already has $80 million in upfront advertising commitments for a planned launch of its advertising option in June. Speaking at its AT&T investor day on Friday, Jason Kilar, CEO of WarnerMedia, added that HBO Max profit margins and revenue continue to climb. “We believe we are already the No. 1 revenue-generating stand-alone subscription video-on-demand service in the U.S.” he says. “We earn 90% in margin from each retail subscriber that we add.”
Walt Disney finished upfront advertising for all its TV and digital advertising brands — ABC, Disney Channels Worldwide, ESPN, Freeform, FX Networks and National Geographic Networks — with a 5% gain in dollar volume, according to executives.
While TV networks continue to negotiate upfront deals — looking for mid-double-digit percentage price increases — TV ad revenues show a flat and/or downward trend over the last two years. Standard Media Index says upfront-placed advertising revenue for the better part of last TV season — October 2018 through April 2019 — came in at $19.3 billion, down 3% on a two-year compound annual growth-rate basis.
Strong Scatter A Good Omen For Local TV
As the TV networks report their 4Q and full-year results, their execs are saying TV advertising is holding up well under the onslaught from digital media. In fact, they add, first-quarter scatter spending continues strong and they are looking forward to a robust upfront market. So while waiting for the pure-plays to report their numbers, let’s remember that strong network sales bodes well for local sales, not to mention the national economy.
A weak TV upfront ad market is not worrying TV network executives. Speaking at the Nomura Digital Media Conference in New York, media selling executives said a weak-performing upfront TV ad market — where broadcast networks witnessed nearly an 8% reduction in advertising dollars to $8.45 billion, and where cable networks dipped almost 5% to $9.68 billion — is not a concern.
Exclusives
Even Dave Thinks Les (Moonves) Is More
Of the Big Four network honchos, CBS CEO Leslie Moonves is the only one who still seems to know how to program to mass audiences, even if it is a dwindling mass, and believes in what he is doing. Broadcasting has no greater or more ardent champion. This TV season, Moonves and CBS were finally rewarded for their single-minded commitment to broadcasting by capturing the 18-49 demo crown.
