[opendtv] News: Online Commercial Slots

  • From: Craig Birkmaier <craig@xxxxxxxxx>
  • To: OpenDTV Mail List <opendtv@xxxxxxxxxxxxx>
  • Date: Fri, 3 Nov 2006 08:24:34 -0400

Via Ken Radio.com

Online Commercial Slots
By 2011, spending on digital outgrowths of TV will more than triple to $5 billion annually, Jupiter Research estimated in a report. That sum still would represent only 2% of spending by advertisers and consumers on filmed and television entertainment, so network executives must be careful to protect their mass audience on television while creating smaller groups of more engaged viewers on digital platforms. The demand for online advertising partly reflects some advertisers' fears that digital video recorders are eroding the effectiveness of TV advertising. In a worst-case scenario, DVRs could wipe out about 11% of commercial watching and a similar amount of TV advertising revenue by 2011.

Commercial slots in the online versions of network shows are a hot commodity, with ABC, CBS and NBC all reporting rapid sellouts of Internet advertising in this, the first season that television has plunged into the Web. Digital sales only represents a ripple in total spending on video entertainment, and it's likely to be a while before the traditional 30-second TV spot is supplanted. ABC collected $2.3 billion for prime-time advertising space at this year's upfront market. By comparison, the network has signed up 36 fourth-quarter advertisers for ABC.com at more than $100,000 a pop. The numbers illustrate advertisers' desire to explore the Web's potential without abandoning the format they know best. Expanding digital income is a corporate priority at Scripps Networks, which expects to generate about $50 million in online and interactive sales this season. That would represent between 5% and 10% of total advertising revenue at Scripps. While traditional ad sales at Scripps networks, including HGTV and Food Network, rose by double digits this year, advertisers doubled the amount of money they added to packages that incorporate online advertising.

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