Adage on Brisk Ad Sales for NFL Games
Rupert Murdoch has said that sports are the battering rams of pay television.
The expansion of distribution methods for television has placed scarcity in broadcasting away from distribution and onto content production. This gives copyright owners leverage because success as a broadcaster depends upon securing ongoing access to the the rights of distinctive and attractive programming. So, the bargaining power of television rights owners has increased. The growth in pay television has lead to bidding wars for attractive content from sustainable producers and inflated the cost of programming rights. Sports is the perfect example and trends show that sports franchises have moved from mainstream channels to pay channels over the last few years in increasing numbers. With direct payment, costs for outbidding terrestrial rivals are simply passed on to the viewer. Advertiser-supported broadcasters cannot do this. So the growth of subscription funding is inevitably shifting not only audiences but also economic power away from advertising-funded channels to pay-television operators.
Even costs for game production are projected to rise as demand for third party intellectual property from proven sports franchises becomes more desirable to game companies looking to mitigate escalating risks from fewer profitable titles.
AdAge reports on the brisk Ads sales of NFL games:
Advertising Age - MediaWorks - Broadcast, Cable Execs Applaud Brisk Ads Sales for NFL Games
Excerpts:
ESPN is virtually sold out of its "Monday Night Football" inventory, although it's worth pointing out that cable operators that carry the sports channel get about 30% of the total ad inventory available. Fox has sold between 85% and 90% of its Sunday football inventory. NBC, the new player in town, is 85% sold, and CBS is 80% to 85%. Overall, cost-per-thousand-viewer increases compared to last year outpaced this year's broadcast upfront pricing increases at around 5% to 8%.
Sales at the major networks have been strong this year, because sports is seen as a sure bet among clients and agencies who need to put money down in the fourth quarter. Football offers continuity in terms of steady ratings and its place on the network grid. Tony Taranto, senior VP-NFL sales, CBS, said: "If you consider the failure rate of TV shows on broadcast and cable overall, the NFL doesn't shift, isn't pre-empted or canceled."
"Sports is the HD game right now," he added, referring to high definition. With even more HD products to advertise, sports is still the arena for HD advertisers to play in.
And high definition is an investment that's paying off for networks, at least when it comes to sports. Buyers estimate that the amount of money HD advertising brings in offsets the cost of offering sports programming in HD.
ESPN is virtually sold out of its 'Monday Night Football' inventory. Sales at all the networks showing NFL games are pacing ahead of last year thanks to growth in categories such as quick-service restaurants and foreign auto marketers.
