Despite Gloom, Linear TV Ad Revenue Down 1%, Says SMI

Entertainment struggles while sports and news thrive
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Despite the shift of viewing to on-demand streaming services, advertising revenue for linear television was down only 1% to $44.1 billion, according to a new report from Standard Media Index.

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SMI said its figures exclude the Olympics and World Cup in order to present an apples-to-apples comparison. The results were better if revenue from digital revenue at the big network groups were to be added in, the research company added.

For the fourth quarter, national linear TV advertising was down 0.9%, with the biggest falloff coming in prime time entertainment. Prime time entertainment ad revenue dropped 14.5%, compared to a plunge in ratings of more than 20%.

Linear TV was helped because advertisers see value in the reach and safety of network advertising and were willing to pay higher prices on a cost-per-thousand (CPM) basis as viewership levels erode.

NFL quarterback Tom Brady with the New England Patriots

Ad revenue from NFL games rose 10%.

“This is a very solid result given audience fragmentation. If you add in Digital Video for the network groups, the National TV market was up more than 2% in 2019.” said SMI CEO James Fennessy.

NBCU had the largest share of linear TV revenue with 18.7% of the market. Newly merged ViacomCBS had a 17.8% share and the Walt Disney Co. had 16.9%. They were followed by Fox at 14%, Discovery, 9.3%; WarnerMedia, 7.5%; and A+E Networks, 3.3%.

Discovery was up 8.4% in the quarter and Fox grew 6.8%, largely because of NFL football.

Sports and news performed well in the fourth quarter.

Demand for advertising during National Football League games helped hike revenue for sports by 6.6% in the fourth quarter. The network that aired NFL football increased their revenues by 10% in the quarter to $2.1 billion. The price for in-game commercials rose 7% and there were 3% more spots.

News revenue was up 4%. Broadcast news revenue was up 10.7% in the quarter, while cable news slipped 3.1%. Fox News has the most revenue, but was off 2.1% from a year ago. MSNBC was No. 3 in revenue but posted a 6% gain. CNN was down 7.3%.

SMI gets its data from invoices in the computer systems of media agencies representing about 70% of the national TV market, including five of the seven major holding companies. It measures 130 national TV networks and gets viewership information from Nielsen.

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