Last summer was a just a little sleepier than usual at the broadcast TV networks, as prime- time unit costs dipped 2 percent versus the year-ago period.
According to analysis by the independent media agency TargetCast tcm, the average prime- time :30 on the Big Four broadcast nets cost $80,495 in the third quarter, down slightly from Q3 2009. As has been the case since the year began, Fox beat all comers with an average spot rate of $104,842, while prices at ABC, CBS and NBC fell within a narrow range (from $70,000 to $79,000).
Looking back to the more lucrative spring season, TargetCast reported that rates in the second quarter grew 1 percent versus the prior-year period. Fox commanded the highest unit cost ($211,732 per spot), followed by ABC ($125,940), CBS ($110,794) and NBC ($81,784). All told, prime time broadcast spots averaged out to $123,881 a pop in Q2 2010.
To some extent, rates were stabilized by advantageous comparisons to a much softer 2009 ad sales market. But scatter pricing at premiums as high as 30 percent above upfront rates certainly had an impact as well.
“The robust demand for television combined with limited available inventory, stable ratings and a very soft market a year earlier drove unit prices and CPMs higher in the second quarter,” said Gary Carr, senior vp, executive director of national broadcast, TargetCast. That said, Carr warned that as viewers continue to find engaging programming options elsewhere on the dial, broadcasters should get used to the reality of a shrinking ad market.
“Network unit costs overall have been experiencing significant declines in recent years, due to declining ratings and the growth of cable,” Carr said.
Speaking of cable, the top ad-supported networks continue to steam along. TargetCast estimates that the average cost of a 30-second spot on the 15 most-watched cable nets was up nearly 10 percent in the second quarter and 7 percent in Q3.
Leading the pack was ESPN, which commanded $27,000 per spot in Q2 and $30,000 in the third quarter. TNT, which blends original scripted programming and live NBA coverage, came in a close second in Q2, taking in $23,000 per prime time :30. Per TargetCast, TNT’s average spot cost dropped to $18,000 in the third quarter of this year, a period in which the Turner net beat ESPN in the adults 25-54 demo (1.1 million to 1.07 million, per Nielsen).
It should be noted that the efficiencies offered by most cable nets don’t always apply to ESPN and TNT, as the both nets enjoy the trappings of relatively high CPMs.
While the TargetCast numbers don’t demonstrate a profound swing in either direction, ad sales chiefs can take some measure of satisfaction in that the Q2 and Q3 figures reflect a vast improvement from the first three months of the year. Utilizing data from NetCosts, TargetCast found that the average cost per unit for a prime time :30 on ABC, CBS, Fox and NBC declined 10 percent.