Ad-free SVOD set to accelerate TV ad revenue declinenScreenMedia - 0 views
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SVOD providers are particularly problematic for broadcasters and their advertising partners, because they hurt ad supported television in a number of ways: Consumers with SVOD subscriptions replace time spent watching ad supported television with ad free SVOD watching With so much of online video viewing time spent watching ad free, those quality ad opportunities that are available are more expensive to buy Consumers get a decreased tolerance for advertising as they grow used to seeing content uninterrupted.
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U.S. ad agencies spent 2% less on broadcast TV networks in the 4th quarter of 2014 and 16% less on national cable TV. The company also found that, if you exclude the Olympics, broadcast ad revenue would have declined 2% for the full year (it increased 4.1% when the Olympics are included.)
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online originals are growing prodigiously and a good proportion of that inventory will provide advertising opportunities. For example, Alex Carloss, YouTube’s head of original programming, announced the site would be funding more original programming in the same way it did in 2012.