The national cable advertising market is in disarray, unsettled by the options presented by the Internet and video-on-demand (VOD), according to Kagan Research.
As a result, some cable networks have experienced flat revenue in the first half, while others reported strong double-digit gains.
Kagan reports that ad agencies are being pressured by clients to jump on the new media bandwagon, causing dollars to be siphoned from broadcast and cable campaigns into Internet advertising, VOD spots and sponsorships, and long-form ads delivered via VOD.
Some cable network industry icons, meanwhile, have fallen from grace, and ad buyers are no longer renewing expensive ad campaigns out of sheer inertia. This has resulted in a weaker than expected upfront market with some major buyers staying completely out of the upfront.
The rapid growth of digital video recorders (DVRs) is causing many buyers of broadcast and cable to apply an across-the-board discount to spots to account for viewers fast-forwarding through commercials.
All the while, the demographic data on viewership that advertisers are demanding is lacking, because issues involving reporting, standards, privacy issues, and other matters have yet to be resolved, and probably won’t be in the near future, Kagan said. Some advertisers are consequently shifting money to the Web where it’s easier to understand who is seeing ads and what the response rates are.
