High-Def TV Advertising Up 150% Since 2010

But only 25% of TV ads are delivered in HD and only 53% of local stations can accept HD spots, according to a new report from Extreme Reach

By George Winslow -- Broadcasting & Cable, 8/9/2012 2:43:53 PM

Much progress has been made in the area of HD advertising, with the proportion of HD ads being delivered to TV outlets increasing by 150% between the second quarter of 2010 and the second quarter of 2012, according to a new report from video ad distribution and services provider Extreme Reach Inc. The research also found that 69% of all TV outlets are now capable of receiving and airing HD ads.

But the "Q2 2012 HD Advertising Trends Report" also highlights that HD advertisements continue to lag far behind consumer usage, accounting for only 25% of all ads, even though over 70% of all American homes now have an HD set. The report also noted that the proportion of ads being delivered in HD has increased relatively slowly from the end of the fourth quarter of 2011, when 23% were HD.

Local broadcasters also continued lag in both viewer adoption and the rest of the U.S. industry, with only 53% of local stations being able to accept and air HD ads, much lower than local cable (74%), network broadcast (73%) and national cable (76%).

Still the poor record of broadcast station in HD advertising represents a significant improvement over the second quarter of 2010, when only 10% of stations could air high def ads.

Among advertisers, the report found that political advertisers are leading the push to HD adoption, with 51% of political commercials being delivered in HD in the second quarter of 2012, up from 8% in second quarter of 2010. Over the same period, entertainment spots delivered in HD increased from 17% to 50%, financial services grew from 29% to 44, retail increased from 13% to 26% and automotive grew from 16% to 26%.

An additional trend outlined in the report is the movement of TV advertisers to advanced cloud-based solutions for ad distribution. This shift has enabled TV advertisers who use the cloud for ad distribution to deliver an average of 98.5 percent of their SD and HD ads digitally.

"HD TV advertising has seen tremendous growth since 2010, and I think the rise of cloud computing has really helped move the industry forward into high definition" said Dan Brackett, chief technology officer of Extreme Reach in a statement. "By taking advantage of advanced Cloud-based solutions, advertisers have been able to leverage higher performance/lower cost workflows, and those efficiencies have helped fuel the rapid growth in HD advertising."

For this study, the Extreme Reach Research Group analyzed and referenced data from a sample of 1,900 active television advertisers across 28 verticals and 615 active video production studios and content providers. The study includes nearly every commercial television and cable broadcast outlet in the United States and Canada, including all major broadcast networks, and draws from a sample of 270,000 SD and HD commercial deliveries completed over the three-month period between April 1 and June 30, 2012.