Iger: Lack of Blockbusters Is Putting the Hurt on TV Ratings

Disney exec also cites time-shifting, Olympics disruption for ad market woes

Yesterday, CBS posted its earnings for the third quarter, announcing that ad sales at its broadcast division had fallen 5 percent to $895 million. As was the case across the TV dial, the Olympics played some part in CBS’ year-over-year decline.

Also not helping matters—a fall ratings slump. Through Week 6 of the 2012-13 broadcast season, CBS is averaging a 2.8 rating among adults 18-49, a decline of 18 percent versus the year-ago period. Deliveries of adults 25-54 have been impacted similarly.

“This clearly was an unusual start to the season, with most networks’ ratings all over the place,” said CBS president and CEO Les Moonves, who added that a number of factors were shaking up the Nielsen ratings. “People are watching more programming than ever, but they are increasingly time-shifting that content through the DVR, streaming and video-on-demand. Nielsen is doing a good job of finding ways to measure this viewing, but not all of it is captured yet.”

Moonves added that year-to-year comps present a challenge, as four nights of programming were preempted by the presidential and vp debates, while Thursday nights have been shaken up by NFL Network’s enhanced football package.

“These early numbers you’re seeing are atypical,” Moonves said. “We fully expect … that when the season ends, we will once again win in viewers in 25-54 and be right there in 18-49 as well.”

Along with softer ratings for its Monday night comedy lineup, CBS has seen spotty results with its new programming efforts. The network canceled the Friday night legal drama Made in Jersey after just two episodes—a pair of previously unaired installments will be burned off on consecutive Saturday nights—and the new comedy Partners is averaging just 5.96 million viewers and a 2.1 in the demo on Monday nights.

That said, CBS has given full-season orders to its remaining set of freshman dramas. Elementary is the net’s top new performer, averaging 11.2 million total viewers and a 3.4 in CBS’ target demo (25-54), while the older-skewing Vegas is drawing 12.1 million viewers and a 2.8 in the demo.

Elementary happens to be one of the more valuable new dramas on broadcast, as clients who invested in the show during the upfront are paying around $145,000 per 30-second spot, per SQAD NetCost data. By comparison, NBC’s hit drama Revolution fetched a unit cost of just $95,000.

CBS’ priciest offerings are found within its weekly NFL packages. Per SQAD, the early Sunday game fetches some $316,200 per spot, while the 4 p.m./4:30 p.m. EST broadcast commands $385,000 a pop.

Naturally, the Super Bowl is CBS’ most desirable showcase; Moonves reiterated that the net has just a few spots left and has moved inventory at rates as high as $4 million per :30. (In New York City alone, the sales team has sold a local spot on WCBS-2 for a towering $1 million.)

Moonves said that despite the ratings shortfall, CBS is not facing “any make-good issues whatsoever.” He added that Q4 scatter is “very strong and is, in fact, now building.”

Looking ahead, CBS expects a major push from the AFC Championship Game, Super Bowl and Grammy Awards. “These broadcasts will give us a huge boost in advertising, and thanks to the promotional platform they will provide, our ratings in the quarter after that will benefit as well,” Moonves said. “We are very confident that our prime-time ratings will continue to improve.”

All told, revenue at the entertainment segment was up 3 percent in the July 1-Sept. 30 period, adding up to $1.68 billion.

Lastly, the cable network segment grew 4 percent to $436 million, driven by continued steady growth in rates and subscribers at Showtime. The premium net is now in more than 22 million households.