Despite the fact that the network scatter advertising market has been on fire for the second half of the year, with word of 30%-plus price hikes over the strong upfront pricing, revenues for the Big Three are up just 1.6% for the first nine months of the year.
And that's with a $700 million-plus infusion from the Salt Lake City Olympics earlier this year as well as the benefit of easy comparison's to the post-9/11 TV ad drought.
According to figures compiled by Ernst & Young and released by the Broadcast Cable Financial Management Association, net revenues for the Big Three networks (ABC, NBC, CBS) totaled $7.7 billion year-to-date through Sept. 30.
For the third quarter, revenues are up 7.6% to just over $2 billion. But analysts say that's not terribly impressive, given the estimated $600 million shortfall that followed last year's 9/11 disaster.
But the nine-month totals don't come as a surprise to media consultant and ad forecaster Jack Myers. Indeed, it's generally in line with his full-year 2002 broadcast-network forecast. While pricing has firmed up over the last two quarters, Myers says ratings erosion across the Big Three networks continues. So even though pricing is up, the total revenues are flat or even down, he says.
The good news is the fourth quarter, Myers says. It will see a strong uptick because that's where the first money from the strong '02 upfront market will show up. "They will show better growth in the fourth quarter than in the first three quarters," Myers says of the broadcast nets.
With that fourth-quarter bump, the networks should be up between 2% and 3% for the full year, he says. The Merrill Lynch estimate for '02 is just a little higher—between 3% and 4%.
Year to date, news, kids and daytime advertising are all down double digits, according to the Ernst & Young figures. Prime time is down 7% (to $3.8 billion) and late night is down 5%. Early morning (Today
and its competitors) is flat at $453 million, while sports advertising is up 40% due to the Olympics in February.
"Despite a healthy third-quarter performance and an influx of new advertisers, there is every reason to be cautious regarding the fourth quarter with the economy still wavering and auto makers seeing slowing sales," says W. Charles Warner, managing director, BCFM.
But Myers is relatively optimistic about the network-TV picture from now through at least the first three quarters of 2003. "I'm foreseeing a fairly positive year," he says. His early line on next year: up 3%.