In Fragmented Media Environment, Value of Broadcast Rising

by Paige Albiniak  |  05.15.2017

In a world of fragmented TV viewing, it’s counterintuitive that it’s actually a great time to be a broadcast network.

But as streaming services rise and cable networks decline at the hands of cord-cutters, broadcast networks remain the one place where advertisers can reach a nationwide audience.

As the New York Times writes: “Ratings aside, television still reaches more people and provides a reliable way for an ad to be seen on a full screen with sound. There is a limited amount of inventory, in contrast to the endless reach of the web, and marketers know rates will spike if they wait to buy airtime.”

Moreover, digital platforms have been plagued by advertisements showing up next to unregulated, objectionable content. That’s sent marketers running back to the relatively safe environments broadcast networks offer.

At this week’s upfront presentations in New York City, the broadcast networks and major cable networks are rolling out their 2017-18 fare to advertisers. The week kicked off Monday with NBC in the morning and Fox in the afternoon all the way through until The CW wraps up the week on Thursday. Advertisers are expected to once again spend more than $9 billion on upfront advertising commitments. 

The continued strength of the broadcast upfront market seems mysterious when networks’ ratings declines are considered. Every year, the aggregate ratings of the Big Five networks are down a bit more. But they are still the only places in the television market where advertisers can reach the entire country. And hugely watched, highly rated live events such as the Super Bowl or the Academy Awards are more valuable than ever because such events are relatively rare in the media spectrum.

Also rare are big hits like NBC’s This Is Us. Last year, This Is Us was the most-watched trailer out of the upfronts. The show opened big, and as the season went on, the ratings only grew. That gave NBC some options when it came time to selling the show, reported Broadcasting & Cable.

“We are going to look to sell things a little differently with This Is Us, to sell things on a more converged basis, which would be the first program we’re looking to do that with,” said Mark Marshall, executive VP, ad sales, NBCUniversal to B&C.  “[P]rimetime isn’t just 8 p.m.-11p.m., it’s whenever these people choose to seek out this programming and they’re doing that in record numbers, so we’re looking to continue to evolve how we sell things.”

Still, like many other industries, television is in a state of disruption. Younger viewers are increasingly moving to platforms such as YouTube, Twitch and Netflix, and growing accustomed to watching shows without any advertising at all. Advertisers also are seeking environments where they can precisely target the consumers they desire. TV typically hasn’t offered that sort of environment, but broadcast network ad sales teams are working hard to build those systems. 

READ MORE: The New York Times, Broadcasting & Cable

[Cube image of advertisers headed to Fox upfront courtesy of Marc Berman]

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